The professor of the Graduate Program in Environmental Science at the Institute of Energy and Environment of the University of São Paulo (IEE-USP), Pedro Luiz Côrtes, questioned the intention of the government of the state of São Paulo to privatize the Companhia de Saneamento Basico do State of São Paulo (Sabesp). According to the researcher, the state administration did not present reasons that would justify a possible decision to privatize the company. The government of São Paulo holds 50.3% of Sabesp’s control – which is managed as a publicly traded corporation. The rest of the shares are traded on the B3 in São Paulo and on the New York Stock Exchange. The company obtained, in 2022, a profit of BRL 3.12 billion, a result 35.4% higher than the BRL 2.3 million recorded in the previous year. The specialist pointed out that Sabesp is a well-managed company, with great technical capacity, not dependent on state government resources, and capable of financing its works with its own resources or raising funds from financial institutions. “It is up to the state government to explain the reasons that lead it to think about privatization”, said Cortês, who is also a professor at the Graduate Program in Environmental Sciences and Technology at the Faculty of Sciences of the University of Porto, in Portugal. He pointed out that the state administration defends that Sabesp’s privatization will improve the company’s efficiency, but points out that the government did not present which indices would serve to measure the improvement in Sabesp’s efficiency. “At no time was it explained what the real benefits that an eventual privatization could generate for the population, either in relation to tariff practices, or in relation to the improvement of the quality of sanitation for the populations that live on the outskirts of large cities, or in the increase in of the sewage treatment fee”, he said. Last week, the government of São Paulo informed that it plans to start, in 2024, public hearings and consultations for the privatization of Sabesp. The state administration has not confirmed, however, whether the privatization auction, or the company’s share offering, will take place next year. “What is expected to happen in 2024, after the conclusion of the studies, is the holding of hearings and public consultations, as well as meetings with investors. Only after this phase can a date for the auction be discussed”, said, in a note, the Secretariat for the Environment, Infrastructure and Logistics (Semil), last week. The studies referred to by the secretariat are the technical feasibility analyzes for the privatization of the company that have already begun to be carried out by the International Finance Corporation (IFC) – an institution linked to the World Bank – and which should last 14 months. “Privatization is taken as if it were a dogma to be followed and, therefore, privatization is always good, it is always beneficial, but, in fact, it does not explain what benefit this could generate for the population. So, I don’t see any justification for supporting, or subsidizing, a decision of this type, or the tendency for a decision of this type to be taken”, reiterates the USP professor. Climate change According to the professor, the current model of water supply in the metropolitan region of São Paulo (RMSP) foresees the capture of rainwater, the maintenance of water in large reservoirs or dams and, later, the treatment and distribution . Côrtes points out, however, that since the end of the last century, the rainfall pattern in the region has changed. The dry and rainy periods became more severe and lasting. “These oscillations are not good for a system of this type because we have not been able to significantly expand the reserve capacity of this rainwater, because that would imply either the development of new reservoirs or the expansion of existing reservoirs”. Cortês says that, in the face of climate change, a discussion on the water distribution model to be used in the coming years is much more urgent than on the privatization of Sabesp, the company that operates the Cantareira System, the largest water producer in the RMSP and which supplies approximately 46% of the area’s population. “We need to think about a distribution system that is more resilient to climate change. The current system, no matter how good Sabesp’s administration is, the efforts it has been making, have not been enough to improve water security in the metropolitan region of São Paulo. This would be much more urgent than considering eventual privatization,” he highlighted. With the privatization of Sabesp, the researcher states that the current model, of capture, treatment and distribution, runs the risk of becoming stagnant. “Once privatized, the system will be what it is. And I question: who will be in charge of assessing, in 10 years from now, for example, whether this system is adequate or not? What investments would be needed to improve water security?” he asked. “Discussing the model does not mean abandoning the existing model; but, in fact, looking for alternatives to reduce our dependence on the rain cycle, because the rain cycle no longer behaves the way it did in the last century.” State government At the beginning of the month, when the state government announced the start of studies for the privatization of Sabesp, the state governor, Tarcísio de Freitas, said that the privatization would improve the company’s efficiency. “Our government’s proposal for Sabesp is to create a model that combines an improvement in the quality of service and a drop in tariffs. That’s perfectly possible. The privatization will improve Sabesp’s investment capacity, which increases efficiency, reduces the loss of water in the network and gives a lot of impetus for the full universalization of supply and sanitation in São Paulo.” The governor noted, however, that the privatization process depends on the results of the studies. “If the studies prove that the proposal will bring significant benefits, such as an increase in the company’s operational efficiency and improvement in the quality of services, including expansion and anticipation of goals.
Agência Brasil
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