Building on the experience gained from Dreampipe I (formerly known as Dreampipe Stage 1), a second Dreampipe prize competition will now take place: Dreampipe II. This prize competition will consist of three distinct phases. Prizes will be awarded to the winners of each phase.
The objective of Dreampipe II is to encourage the development of workable and replicable ideas for how to expand the financing available for non-revenue-water (NRW) reduction activities in developing countries – beyond the conventional sources (mainly the development banks and agencies and governments). The key will be to find ways to reduce perceived risk for the new sources, especially (but not only) for commercial lenders. One way to help convince financiers of the viability of larger efforts is by first carrying out successful smaller demonstration projects. Another way is to put together deal structures that make the best use of concessional financing to mobilise additional financing from more commercially oriented sources.
The focus of Dreampipe II is on NRW-reduction activities and investments with high benefit-cost ratios and rapid payback periods – rather than on massive programmes of mains replacement that may be justified only over the longer term. In many utilities, the financial gains generated from the top-priority set of NRW reduction activities (in decreased costs and increased revenue – while holding user tariffs constant in real terms) should be able to pay back the up-front investments and financing costs in 5–10 years. This aspect is what drives the requirement that contestants plan an expansion project that will be financed to a substantial extent by non-traditional sources of funding and finance, many of whom may require market interest rates.
For more on the context and objectives of Dreampipe II, please see the Dreampipe II Overview document.