Originally shared on Linkedin by Sandy Rodger

On the eve of World Water Week in Stockholm, Toilet Board Coalition COO Sandy Rodger reflects on the need for new thinking about scale, if sanitation is to reach everyone, while fulfilling its huge potential as a solution provider for business and society.

Traditional infrastructure is BIG. Whether dating from the industrial revolution, or even from Roman times, engineers have built huge structures, magnificent grids providing energy, water, sanitation, and communications. The designers understood that the laws of thermodynamics favour big units – generally more efficient in energy, labour and materials – the classic definition of “economies of scale.”

Supplying a commodity service, built in relatively rich cities with good planning, and working within the linear economy where resource re-use is not considered, these big systems have been largely successful, and represent the model followed worldwide. Except that times have changed – citizens want new choices, new technologies are emerging, and environmental expectations are rising, with the Circular Economy having growing support. Plus, developing countries – where half the world’s population still lack safe sanitation – present a very different opportunity, less able to muster the required funds and long-term planning to build and sustain big civil engineering projects. Across many sectors there has been a trend towards decentralisation – in Schumacher’s words “small is beautiful.” Big has become almost a loaded term, referring to dinosaur industries – off-grid is suddenly cool.

But then what happens to the economies of scale – just when the costs need to be really affordable for those least able to pay for expensive services?

If you’re looking to navigate this puzzle, a good reference is the excellent little book Infrastructures of Consumption*. Here’s an edited extract:

“The call for decentralised technologies is nothing new. The debate on the provision of infrastructure services, such as water and energy, has long been dominated by the controversy between advocates of small-scale decentralised technology, and defenders of large-scale networks. The debate over large and small provision works with rather limited definitions of “scale” focused around extreme possibilities of network configuration. The claims are also highly normative about the relative benefits of alternative options.”

This describes a battle between two extreme and polarised views. To mediate this, it’s worth continuing with Infrastructures of Consumption to uncover a new, much broader understanding of economies of scale – in four forms:

• Large engineered units – The laws of thermodynamics haven’t changed, so in some cases big units still are efficient.
• Scale of Management – What if many units can act as one, leveraging knowledge or buying power – within a company or a wider alliance?
• Reach of Technology – What if many small units are standardised, so that there are economies of scale in their production and maintenance?
• Interconnection – What if digital capabilities allow direct communication and optimisation, of operations, maintenance, communication with users, and enabling a range of new services never imagined in previous centuries?

So in a networked world, small units linked in multiple ways can achieve their own attractive economics. That’s about small units, but not off-grid, as it’s all about interconnection. It’s a hybrid, using elements of large and small where appropriate, and optimising the system as a whole, not the individual components.

In sanitation the Toilet Board Coalition’s (TBC) approach – the Sanitation Economy – fits this pattern: The Sanitation Economy focuses neither on a traditional sewer grid, nor on off-grid toilets. Instead it favours a hybrid – a “New Grid” – large and small units connected by flows of nutrients, energy, water, data, and finance, creating sustainable high-quality sanitation operations.

The evidence emerging from the TBC’s network of entrepreneurs, operating decentralised systems across Asia and Africa, and increasingly targeting routes to scale, is that this hybrid approach has two key advantages:

1. The economics are far better than traditional sanitation systems. That’s partly because capital costs are lower than for big sewer systems. But it’s also because the new grid is an eco-system of businesses, each with products and services to sell – from additional toilet services, to re-use products like compost and renewable energy, and perhaps one day to valorising data informing rapid efficient preventative health interventions. These revenues offset the costs, and may eventually make sanitation self-funding, whereas traditional systems are only a cost, in many places unaffordable.
2. This model reframes sanitation as a solution provider. By making a systems-level change rather than just building toilets or sewers, you get sanitation, of course, but additionally you get…

• Multiple contributions to climate change, both mitigation and adaptation, by producing renewable energy and reducing CO2 and methane emissions
• Improved water security, by recovering more, using and contaminating less.
• Better food security by improving soil health, agricultural productivity, climate change resilience, and reducing plantation operating costs.
• Preventative health, not only sanitation’s traditional (and still important) role in preventing initial disease transmission, but additionally sanitation as a real-time data source for the health of a population.
• Help with wider initiatives enabling women’s health and empowerment.
• A new dimension of smart city infrastructure, where data from sanitation can be integrated with other city systems, such as transport and pollution control, to enhance lives and livelihoods.
• An unexpected opportunity for food, consumer goods, and waste sectors, with sanitation being implemented within a holistic biological waste system which can process all forms of biological waste, enabling substitution of many plastic items with compostable alternatives. At last, a waste pathway for nappies, wipes, sanitary products, food packaging and much else, which, made of plastic, create difficult waste issues today.

This creates a much stronger business case for sanitation, with economic, social and environmental benefits. Sanitation was always important, if you were directly involved or happened to be concerned about it, but now it is attractive on a much broader basis, which can bring more resources, and investment, to the work required.

But remember this is new. This is the system the west never built, because we did our big engineering long ago and were satisfied with that, even if we now face crumbling sewer networks with huge costs of replacement. It’s also the system that a purely humanitarian approach to sanitation, considering it as philanthropy or aid, may never achieve, because of the diverse skill set required. So for all concerned, it’s unfamiliar and challenging:

• Large and small businesses, across many sectors not directly in sanitation, can get involved, finding real business opportunities, far beyond CSR.
• Governments may need to pay much less for these systems, but that creates new challenges of governance, contracting, and regulation.
• Engineers need to relearn how to design new grids – less civil engineering, more systems engineering. New standards are needed, and new education.
• Investors will find commercial returns in sanitation, but will need to build an understanding of risk and return in this unfamiliar new industry.

The TBC, with its growing network of large and small businesses and other stakeholders, is building the evidence base for the Sanitation Economy, and addressing these enabling challenges. Come and join us at World Water Week in Stockholm(session details below), or come to the Sanitation Economy Summit in India 18-21 November (click here to request an invitation).

* Reference: Infrastructures of Consumption, Environmental Innovation in the Utilities Industries, (2005) B van Vliet, H Chappells, E Shove, Earthscan.

TBC Sessions at World Water Week:

• Sunday 25th August – 0900 – Polycentric Approach to WASH Access for All
• Sunday 25th August – 1600 – Entrepreneurship Driving Water Impact For All
• Monday 26th August – 1300 – New Financing Approach to Catalyse the Circular Economy