Business Overview 2009 (pdf - 6.8MB) - Veolia Water

Business Overview 2009

Contents
8
Interview with Jean-Michel Herrewyn
12
14
16
18
20
22
24
Our fundamentals
Locations worldwide
Main subsidiaries
Business activities
Human resources
Research & Development
2009 highlights
28
30
36
42
Our achievements in 2009
Water resource management and protection
Sustainable commitment to clients
and society
Pushing back the boundaries of our business

Challenges /
Nearly a billion people worldwide do not have access to
Water resources are unevenly distributed: 15 countries consume
Seven percent of the world’s energy is used to produce
The number of wastewater recycling units will
Around the Mediterranean Sea, two-thirds of wastewater
2 Veolia Water 2009

safe drinking water.
more than their available reserves.
drinking water.
more than double by 2016.
is still not being treated.
3

Solutions /
Worldwide, Veolia Water maintains and monitors 349,096 km of water
Since 2002, Veolia Water has reduced water system losses in Morocco that
In Central Europe, 14 plants managed by Veolia Water obtain
Renewable energy represents 12% of Veolia Water’s total
Veolia Water has built 15% of world desalination capacity,
4 Veolia Water 2009

distribution networks and 141,756 km of wastewater collection lines per day.
represent the equivalent of the water usage of 800,000 people.
60% of their energy requirements from cogeneration.
energy consumption.
a figure expected to double within 10 years.
5

The world’s leading operator of water services, Veolia Water operates water and wastewater services on
behalf of public authorities and companies. It also designs the technical solutions and builds the facilities
needed to provide those services. Veolia Water covers the entire water cycle with a constant focus on
protecting resources and saving water. Veolia Water’s activities range from raw water withdrawal from
the environment to production and distribution of drinking water and industrial process water, and
from the collection and transportation of wastewater to treatment for subsequent recycling or discharge
back into the environment. Veolia Water is a division of Veolia Environnement, which also provides services
in waste management, energy and transportation.

The global
benchmark in
water services
95,789
employees worldwide
€12.56 billion
in revenue
4,500 contracts
managed around the world
Nearly 95 million people
provided with water service
More than 68 million people
provided with wastewater service
66 countries
where Veolia Water operates
7

Entretien /
Interview with
Jean-Michel Herrewyn,
Chief Executive Officer
of Veolia Water
8 Veolia Water 2009

How would you sum up 2009?
I would say that 2009 was a satisfactory year, even though
the recession obviously impacted our business.
Financially, the economic climate interrupted the strong
growth we had seen over the previous years because clients
were forced to postpone projects. Our industrial clients were
directly affected by declining production, while our public
authority clients had financing problems. But for a company
like ours, difficulties always mean opportunities. In keeping
with Veolia Environnement’s strategy, we thoroughly
reviewed our activities and made numerous improvements:
we exceeded our targets in cost reduction and proved that
we could achieve positive cash flow from our activities to
finance our growth.
Commercially, despite strong competition, we fared well
because our clients were even more demanding; that’s
because the recession and increasingly complex regulations
made our expertise all the more necessary to them. Many
public authorities therefore chose to renew our contracts.
One example is Mafra, Portugal. Another is Bucharest,
Romania, where a trusting relationship between our people
and the municipality resulted in the signing of an
important amendment to the 25-year contract between us,
which began in 2000. These successes have bolstered Veolia
Water’s position as the leader in European wastewater
service. The vast majority of our contracts in France were
renewed. Better yet, we won new contracts there, both in
water and wastewater services, including Mulhouse,
Chaumont and Royan (see page 31). Several of these
contracts were awarded by municipal authorities that chose
to return to private-sector management, offering further
proof of our model’s validity.
In terms of labor relations, 2009 saw a continuation of our
work on cohesion, training and safety. In France,
implementation of our inter-company agreement—a
complex operation to ensure that 15,000 employees in
France enjoy a common framework of harmonized
conditions—was finalized. This underlines the quality of our
labor relations. In this favorable climate, we continued
rolling out our policy on skills management and training,
both of which ensure the professionalism of our teams
everywhere in the world and equip us to face the challenges
in our markets. Our employees also deserve the best when it
comes to occupational health and safety. Nothing will
deflect us from this commitment, and although the law of
diminishing returns applies as we reach our targets,
our performance was good in 2009. In the United States,
our subsidiary set a new record in safety for the third
consecutive year. It rated far above the other private
companies in the water sector, according to the US Bureau
of Labor Statistics. No matter what the future brings, skills
management, training, and occupational health and safety
will remain a priority for us.
More generally, what are the big challenges
associated with water today?
Access to drinking water and sanitation, and the pressure
on water resources are definitely the two major challenges
of the day. And they are even greater in the current context,
with the recession and climate change heightening
disparities. As the gap between the needs and the resources
available widens, the public is becoming more and more
aware of the urgency of the situation and the need for
more-sustainable development. In 2009, the World Water
Forum in Istanbul and, to a lesser extent, the UN Climate
Summit in Copenhagen, revealed the international
community’s concern about these issues. It is increasingly
accepted that, in the face of such complex problems,
responses can only be pragmatic and local. It is also
recognized that there is a cost associated with water
services, that this cost must be recovered if the services
are to endure, and that the sector’s private professionals
definitely have a role to play in water management,
alongside the public and non-governmental players.
9

Interview /
Veolia Water is thoroughly
equipped to help its clients reduce
their carbon footprint.
Against this backdrop, how did Veolia Water
fulfill its role in managing water issues in 2009?
We remained focused on the question of access to basic
services for all. It was, and, as I see it, still is a priority. Veolia
Water is committed to doing its share toward achieving the
Millennium Development Goal of halving the number of
people without access to safe drinking water and basic
sanitation by 2015, and we continued to support authorities
in achieving ambitious service or connection targets.
Where local government makes water a priority, Veolia Water
has the resources and expertise to meet expectations. That is
the case in Morocco, where, for the past seven years, our work
in building equitable and efficient water service has also saved
the equivalent of the water consumption of a city with a
population of 800,000. Our work in that country continues,
and we have asked MIT (the Massachusetts Institute of
Technology) to evaluate the impact of the system of subsidized
connections we introduced there.
Besides fulfilling our obligations under our public service
management contracts, we continued our actions to ensure
access to water in poor rural areas. In Bangladesh, our first
drinking water production plant was inaugurated in Goalmari
by Antoine Frérot and Professor Muhammad Yunus, the
co-founders of the Grameen Veolia Water joint venture.
To identify the areas for improvement and be able to replicate
the experience elsewhere, Veolia Water signed an agreement
on a research partnership with the ESSEC business school’s
Institute for Innovation and Social Entrepreneurship at the
start of 2010.
How is Veolia Water’s work progressing on
reducing pressure on water resources?
Making water sustainable, in other words, satisfying
increasing needs while sustainably preserving water, is our
other major priority.
For the increasing number of clients that are interested in the
notion of saving water, we have stepped up our efforts in
combating wastage. Our expertise in network efficiency,
management and leakage reduction has led to significant
improvements around the world. It has also enabled us to
embark on new avenues, such as tracking drinking water
quality. This involves analyzing flows at different points with
sensors installed in the networks, so that clients can be
informed of risks and corrective action taken quickly.
In all our contracts, demand management is also a way of
saving water and in 2009, Veolia Water made a point to
advise its clients on managing demand. Over the past
20 years, we have built up solid expertise in individual
metering and have been recognized for this expertise in
France, with official accreditation for Sade’s metering
department to manage meters for public authorities.
Based on this know-how, Veolia Water does its utmost to offer
its clients more-efficient services and innovative information
management tools that enable them to control their
consumption. That is how remote meter-reading, a newgeneration
service that continuously and from a distance
collects and transmits information from a water meter,
has become a reality in Metz, Deauville and Beaune.
In some cases, as in Paris, the fact that we had an excellent trackrecord
did not prevent the authorities from reverting to
municipal management of the water system. That’s just how
competition works, and, while some people are quick to forget
it, the same rules apply to competition between contracting to
private companies and management by the public sector. Be that
as it may, our teams did fantastic work there for 25 years, and
I wanted to call attention to that fact and thank them publicly.
10 Veolia Water 2009

Breakdown
of revenue
44.3%
55.7%
Another aspect of our mission is resource preservation. Veolia
Water has been innovative in monitoring and preserving
aquatic environments. We offer a complete range of services,
and that has won us many contracts, for example, the Gold
Coast project in Australia. Veolia Water began operating this
major desalination plant, built by Veolia Water Solutions &
Technologies (VWS), in 2009. The project includes a program
to protect the surrounding marine life. In the United States,
our commitment to helping public authorities deal with their
environmental problems has been singled out by the
National Council for Public-Private Partnerships, with an
award for our work—and research program—in connection
with our wastewater service contract in Milwaukee.
When it comes to coastal protection, the year of the Grenelle
Environment Forum on the Sea in France saw Veolia Water
continuing its work on ensuring bathing-water quality. Our
service, which informs our public-authority clients on
possible pollutants in real time, was enhanced. The city of
Pornic and the Dieppe-Maritime Metropolitan Area, with
which we partner, tested the service and were the first
municipalities in France to obtain bathing water certification.
This capacity for innovation is continuously tapped by Veolia
Water and its subsidiaries to satisfy their clients’ new needs
at all stages of all water cycles. That is our strength.
What do you think 2010 will bring?
The economic climate will probably remain difficult, but we
have what it takes to both improve the return on our industrial
clients’ investments and optimize the management of our
public-authority clients’ assets. With the pressure on water
resources, to make a difference, a company must be capable of
offering services that minimize consumption of basic
resources—water and energy—and be able to contribute to
sustainable development. We have that capacity, and we will
prove it when we present our expertise at Expo 2010 Shanghai.
Veolia Water is thoroughly equipped to help its clients do their
share in combating climate change and reduce their carbon
footprint. Sade, for example, has come up with new solutions
for reducing environmental impacts and also conducts carbon
assessments of its projects. For its part, Veolia Water Solutions
& Technologies has embarked on a major project to optimize
the total cost of all greenhouse gas emissions for any particular
client. The project will be extended to cover all of Veolia Water.
As in previous years, our growth will continue to be based on
new and improved technologies and services, and flexible
contracts. 2010 will therefore offer us fine opportunities to
demonstrate the effectiveness of our innovative, responsible
and supportive model.
France
International
Growth
in workforce
82,867
93,433
95,789
2007 2008 2009
11

12 Veolia Water 2009

Our
fundamentals
14 / Locations worldwide
16 / Main subsidiaries
18 / Business activities
20 / Human resources
22 / Research & Development
24 / 2009 highlights
13

Our fundamentals /
Locations
in 66 countries
Breakdown of revenue
by geographic area
11.2%
7.4%
19,164
8,675
8.5%
8,412
44.3 %
Breakdown of workforce
by geographic area
28.6%
29,055
30,483
Europe (excluding France)
France
Americas (including Proactiva)
Asia-Pacific
Africa – Middle East – India
Europe (excluding France)
France
Americas (including Proactiva)
Asia-Pacific
Africa – Middle East – India
Americas
1 Argentina
2 Brazil
3 Canada
4 Chile
5 Colombia
6 Ecuador
7 Mexico
8 United States
9 Venezuela
Africa,
Middle East,
India
10 Algeria
11 Benin
12 Burkina Faso
13 Côte d’Ivoire
14 Egypt
15 Gabon
16 India
17 Israel
18 Lebanon
19 Libya
20 Morocco
21 Namibia
22 Niger
23 Oman
24 Qatar
25 Senegal
26 Saudi Arabia
27 South Africa
28 Tunisia
29 United Arab Emirates
87
78
3
6
5
4
9
1
2
14 Veolia Water 2009

28 25
48 35
54 42
64 51
46 34
51 39 60 54 55 43
56 44
45 32 42 37 58 33
63 49
49 36 65 52 44 31 50 38
59 46
53 41 52 40
62 48
57 45 47 50
29 28
23 20
11 10
22 19
25 22
14 12
13 11
15 13
18 15
24 21
10 27
66 53
21 18
20 17
16 14
43 30
12 26
27 24
17 29
26 23
61 47
19 16
31 56
40 65
38 62
33 57
41 66
35 59
32 63 34 58
39 64
37 61
30 55
Europe
30 Armenia
31 Austria
32 Belgium
33 Czech Republic
34 Denmark
35 Finland
36 France
37 Germany
38 Hungary
39 Ireland
40 Italy
41 Monaco
42 Norway
43 Netherlands
44 Poland
45 Portugal
46 Romania
47 Russia
48 Serbia
49 Slovakia
50 Spain
51 Sweden
52 Switzerland
53 Turkey
54 United Kingdom
Asia, Pacific
55 Australia
56 China
57 Hong Kong
58 Japan
59 Malaysia
60 New Zealand
61 Philippines
62 Singapore
63 South Korea
64 Taiwan
65 Thailand
66 Vietnam
36 60
15

Our fundamentals /
Main subsidiaries
VEOLIA WATER SOLUTIONS & TECHNOLOGIES (VWS)
€2.5 billion
in revenue
9,557 employees
130 business units in 57 countries
250 proprietary technologies
The world leader in water treatment, VWS is at the forefront of innovation. It specializes in engineering, turnkey design-build projects, and technological
solutions for public authorities and industrial companies.
VWS is the technical subsidiary of the water division of Veolia Environnement. VWS has built a unique portfolio of over 250 technologies combining
physico-chemical processes (Actiflo® Turbo, CEDI), biological processes (Biostyr, AnoxKaldnes, MBBR) and thermal processes (MED desalination, SOLIA).
Backed by its 9557 employees and a decentralized organization with 130 business units worldwide, ensuring its flexibility and responsiveness, VWS focuses
its resources on technological innovation and the development of new solutions thanks to its multidisciplinary expertise.
A partner of public authorities, VWS offers them its expertise in the design and construction of wastewater treatment plants, sludge treatment facilities and
drinking water production plants, with a wide range of technological solutions and related services.
A partner of industrial companies, VWS offers them its technological expertise in process water production and effluent treatment and recycling, from standard
equipment to design and build of turnkey facilities. With the growing complexity of treatment processes, VWS’s solutions create value in such diverse industries as
food and beverages, petroleum products (upstream and downstream), mining, chemicals, pharmaceuticals, solar power, microelectronics, power generation,
steel and metallurgy, pulp and paper, and more. With the challenges posed by sustainable development, VWS innovates to help its clients limit their impacts
on the environment. In this perspective, the Veolia Water subsidiary has launched a major carbon initiative (see page 43) that will enable clients wanting to reduce
their greenhouse gas emissions to benefit from its expertise.
16 Veolia Water 2009

SADE SEURECA
€1.33 billion
in revenue
9,000 employees
7,200 new projects started
in 2009
24,000 metric tons of CO 2
equivalent avoided
3,000 km of pipes
installed
Sade, Europe’s leading installer of water and wastewater networks, is consolidating its position as a leader in the design,
construction, rehabilitation and maintenance of networks and their associated facilities. With approximately 100 business
units in France and a presence in 20 countries, the subsidiary has an in-house design and engineering department
that enables it to respond reliably and creatively to the expectations of all its clients—public authorities, industrial
companies, individuals and parapublic organizations—regardless of the size of their project or their economic
and environmental requirements.
In 2009, Sade continued to expand in its traditional activities. Fully embracing the principles of sustainable development,
it conducts carbon assessments of its work sites and develops innovative techniques to minimize their effects on the
environment (ecological network connections, on-site recycling of excavated and surfacing materials, etc.) (see page 43).
Seeking new growth drivers, the subsidiary has also positioned itself in key sectors. For example, Sade Telecom has become
one of the major players in telecommunications networks and is basing its current growth on rolling out very-high-speed
networks and CCTV systems. Sade is also building a reputation in the renewable energy market, particularly
in infrastructure construction for wind farms, with over 50 wind turbine pads installed so far. It is already positioned
in the very specialized segments of waterproof membranes for landfills, wastewater treatment plants with reed-planted
beds, and stormwater and highway runoff storage tanks. It is among the standard-setters for installing well drilling
and is demonstrating its receptiveness to new markets with an unusual specialization—authorized caravan sites
for traveling people—and the deployment of original techniques, such as rope access work.
Veolia Water’s engineering and consultancy subsidiary
for international projects celebrated 50 years of worldwide
expertise in water and wastewater and environmental
management in 2009. It was a busy year: a hydraulic
model in Gabon, supervision of a wastewater project in Kenya,
feasibility studies on water and wastewater projects
in Tanzania, a water supply project in Ethiopia, improvement
of water network efficiency in Morocco, creation of its fourth
subsidiary in Saudi Arabia, technical support in Bulgaria,
evaluation of water and wastewater infrastructure in Serbia,
a sea outfall in Azerbaijan, a study on drinking water supply
in Vietnam, and more. Seureca also developed its synergies
with Veolia Environnement’s other divisions, with a study
on district heating in Ukraine with Veolia Energy-Dalkia
and the preliminary design of a landfill in Morocco with
Veolia Environmental Services. In 2009, Seureca took up new
challenges and developed local partnerships, while ensuring
the safety of its employees in the four corners of the world.
SETUDE
Veolia Water’s engineering and consultancy subsidiary
for projects in France offers public authorities and industrial
companies comprehensive services in consultancy and
assistance in decision-making in the fields of water,
wastewater and the environment. Its services cover technical
and economic studies; master plans; environmental impact
studies; preparation of administrative files required by
regulations; and assistance in implementing environmental
management and sustainable development programs.
In 2009, for example, Setude modeled the Garonne, Lot and
Ariège rivers, along with the Garonne canal, and then went
on to develop a tool for real-time prediction of pollution and
a system for odor prediction, for the SIAAP water authority.
Setude will celebrate 60 years of consulting in 2010.
17

Our fundamentals / Business activities
Veolia Water manages the
water cycles with a focus on
saving water and protecting
resources
Produce and
distribute
drinking water
Manage raw
water withdrawals
Discharge treated wastewater
into the environment
Recharge
aquifers
18 Veolia Water 2009

Provide
desalinated water
to cities
and industry
Build and
maintain networks
Desalinate
seawater
Recycle wastewater for
industrial applications
Treat all types
of wastewater
Design and build
state-of-the-art technology
Treat wastewater sludge
Treat sludge for use
in agriculture
19

Our fundamentals / Human resources
Our people’s expertise:
our core asset
To provide solutions that
match the specific local
situation of each of its
clients, Veolia Water counts
on the ever-growing
professionalism of its
personnel. Our emphasis
is always on improving
the quality of local services,
developing the highest
skills worldwide, and
continuously prioritizing
training, safety and
diversity.
Rely on training
To be capable of delivering the performance levels expected
by clients and keep pace with the changing demands of
its businesses, Veolia Water relies on training, for which
it invested 2.38% of the payroll in 2009. Dispensed primarily
through the Campus Veolia Environnement network,
with the curricula of the individual sites adapted to local
needs, our training guarantees the same level of technical
expertise in all countries where we operate. In 2009, a new
training center dedicated to drinking water was opened
in Changzhou, China, to serve our employees in the
Asia-Pacific region. Veolia Water has also opted for work-study
programs as a way of preparing for the future.
In 2009, 605 young people were hired under these programs.
Skills to serve performance
Assessing training needs starts with human resources
planning, which is also geared to equipping employees
for career advancement and job mobility—both geographic
relocation and transfers between businesses—and to
becoming a lever for career management. Launched
in 2008, the human resources predictive management
plan is based on common standards developed in close
consultation with the business units.
The program provides a genuine skills map that enables
our operation managers to optimize their organization
and identify talented employees. Deployment of the
program at Veolia Water and its subsidiaries continued
in 2009.
Promote a culture of occupational health and
safety
In 2009, workplace safety was again a priority for us and
an integral part of our continuous improvement process.
A workplace accident management tool was introduced,
a variety of training actions in promoting safety took place,
and safety audits were systematically conducted.
For several years, we have been taking a participatory
management approach to occupational health and safety
in close contact with trade unions and personnel
representatives. Once again, our safety record improved
in 2009. With the frequency of workplace accidents falling
50% in five years, Veolia Water has become a benchmark
for safety in its fields of activity.
Labor relations
At Veolia Water, we are convinced that progress for the
entire company depends on good labor relations.
20 Veolia Water 2009

We therefore attach a great deal of importance to
constructive dialogue with trade unions and employee
representatives. In 2009, that approach resulted in the final
deployment in France of the 2008 inter-subsidiary
agreement, whereby the approximately 15,000 employees
belonging to the Veolia Water-Générale des Eaux Economic
and Social Union benefit from a common, harmonized set
of working conditions.
Diversity and the sharing of experiences
Veolia Water’s long history of operating in many countries
has fostered a culture of diversity within the company.
At the beginning of 2010, we took more-concrete action
against discrimination of any sort by signing a Diversity
Charter in France and launching an action plan on hiring,
training and career advancement. Talks began in 2009 on
renewing the Handicap et vie professionnelle (disabilities
and work) agreement, while the agreement on hiring people
55 years old and over was signed at the end of the year.
Convinced that diversity drives performance, Veolia Water
also encourages synergies and the sharing of experiences,
with, for example, a twinning program for its businesses
around the world.
Welcome to the Changzhou drinking water training center
The doors of the Changzhou drinking water technical training center officially opened in 2009.
The new Campus Veolia center will enhance the skills of our employees in China and the Asia-
Pacific region in all areas relating to drinking water. The approach is to replicate the real-life
work environment, so that employees can practice what they learn. Methods include plant
operation simulators, a treatment pilot unit and customer service training.
The center also serves two other functions as it is equipped with a test bench for water meters
and a materials-testing laboratory.
21

Our fundamentals / Research & Development
Innovation is central to the
major challenges in water
Veolia Water’s R&D is the
mainstay of its business,
anticipating clients’ future
problems and innovating
daily to find solutions.
The water experts within
Veolia Environnement’s
network of 900 researchers
and developers work
on every stage of the water
cycle and every type
of process.
Progress in the management and treatment
of water resources
In 2009, the Ripost® simulation tool was used for the first
time in an industrial application to help with a case of
accidental river pollution. This tool helps forecast the extent
and duration of river pollution so that water intakes can
be protected and appropriate measures implemented.
The Regal project is designed to fight seawater intrusions
in coastal aquifers used for drinking water supplies.
The aim is to prove that recharging aquifers with treated
municipal wastewater is both technically and economically
advantageous.
Our high-performance treatment process, nanofiltration
with a very high conversion rate, is now operational.
Our R&D teams are also making progress on the Opaline®
range. These processes combine ultrafiltration membranes
with an adsorbent (activated carbon) to remove
microorganisms and micropolluants like pesticides.
A new membrane is currently being developed for the
Opaline® C process.
Veolia Water is also working with the universities of Poitiers
in France and Brisbane in Australia on the production of
recycled water by membrane treatment of wastewater.
The objective is to develop processes that will minimize
both operating and investment costs.
Water quality traceability in the supply network is another
new service we are currently rolling out after completion
of work on the Smart Meter sensors. These low-cost sensors
provide real-time chlorine, pressure, temperature and
conductivity measurements and can be installed for dense
geographic network coverage. Thanks to this service clients
can be informed of accidental pollution and water quality
can be optimized at the distribution point.
Progress in wastewater treatment technologies
In municipal wastewater treatment, the Amonit® process
management tool enables energy savings of up to 50%
in the simultaneous nitrification-denitrification phases.
Industrial effluents, which can be extremely variable
in terms of their type, load and composition, must be
characterized and assessed in real time in order to prevent
toxicity problems resulting from biological treatment.
This is now possible, thanks to the completion of the first
industrial on-line alert prototype, on which work started
in 2008. This device can also be used for municipal effluents.
Work on saline industrial effluents (such as leachates
22 Veolia Water 2009

at landfills), which are widespread and difficult to treat, has
culminated in a technological manual created in
conjunction with Veolia Environmental Services. This
manual lists all the operational and dimensional issues of
the various processes, thus enabling operators to optimize
treatments and VWS to devise the best-suited processes.
Limiting impacts and anticipating
the technologies of the future
Where health risks are concerned, accounting for
parameters like the compounds that affect thyroid
functions is now possible at a low cost thanks to Watchfrog,
which is enjoying its first commercial successes.
Veolia Water also continues to take part in the Valoria
program for the treatment and recovery of organic
byproducts generated by wastewater treatment as part
of its work on the treatment plant of the future.
In 2009, we decided to build a test platform to try out new
municipal wastewater treatment processes with a view
to the next “major technological leaps.” This test platform
will be unique worldwide and will be operational in 2011.
Global R&D water projects budget for 2009
€55.1 million
including €12.8 million for drinking water
and €13.8 million for wastewater,
of which €5 million is for industrial effluents.
110
projects in progress
25
patents registered
125
conference presentations
23

Our fundamentals /
2009 highlights
MOROCCO
ONEP, Morocco’s national water agency, awarded
Sade the contract to supply water to the cities of
Benguerir and Skhour Rhamna from the Al Massira
reservoir. This entails 201,247 cubic meters of
earthworks, the installation of 23,170 meters of cast
iron mains and the construction of 129 manholes.
Sade has been active in Morocco since 2002 and
already has a good track record there following
several water and wastewater projects in Khemisset,
and the water supply network between Rabat and
Casablanca in 2008 and in Agadir in 2009.
FRANCE
The city of La Roche-sur-Yon
has renewed its public service management
contract with Veolia Water, signing a 12-year
contract for its water and wastewater services.
The city asked us to support its sustainable
development drive by finding optimized
eco-friendly solutions that would enable it to
reduce the environmental footprint of its public
services. Veolia Water will use its expertise to focus
on major environmental issues like combating
climate change by reducing greenhouse gas
emissions, preserving water resources, developing
responsible water production and consumption
methods, and sustainably managing the city’s
technical assets.
AUSTRALIA
The first advanced water
recycling plant in the Western
Corridor project,
one of the world’s largest recycling
infrastructure projects, was completed
and its operation entrusted to Veolia Water.
In 2009, over 18,000 megaliters of recycled
water were supplied to the region’s two
largest electrical power plants, which
are now no longer dependent on local
reservoirs for their water supply.
24 Veolia Water 2009

UNITED STATES
The City of Gloucester, Massachusetts,
and Veolia Water entered into
a partnership to handle operations
and maintenance of the city’s water
and wastewater treatment facilities.
Under the terms of this five-year
contract, Veolia Water will work with
the city to improve drinking water
quality and the infrastructure of the
city’s water and wastewater treatment
systems. The wastewater facilities
will be upgraded in two phases with
the replacement of the wastewater
odor control system and improvements
to heating and ventilation in the
dewatering area. Veolia Water will
also operate and maintain the city’s five
surface water reservoirs, including
two plants dating back to the late 1960s.
GABON
SEEG, the Gabon Water and Electricity Company,
which is 51% owned by Veolia Water, has set up
two neighborhood services for customers with
subscriptions to the Edan prepaid electricity
meters. First, it established an extended network
of approved partner traders in Libreville to
complement the network of agencies. Second,
customers can now recharge their electricity
meters in any agency or sales outlet in the country.
GERMANY
In 2009, Veolia Water
celebrated
the anniversaries of several contracts: 15 years
of services to the public authorities of Ostritz/
Reichenbach, 15 years of partnership in
Döbeln-Oschatz (Saxony), 10 years in
Grimma-Geithain and 10 years of public-private
partnership with Berliner Wasserbetriebe.
25

Our fundamentals / 2009 highlights
INDIA
The city of Nagpur awarded Veolia Water
its fourth contract in two years.
This rapidly expanding Indian city wants
to increase its water supply facilities.
After the Pench 1 and Kanhan plants,
it asked Veolia Water to design, construct
and operate for 10 years a new plant
with a daily capacity of 115,000 cubic
meters. The fourth and current project,
which entails continuous water supply
to 160,000 people in a pilot area, recently
won the National Urban Water Award
presented by the President of the Republic
of India.
CHINA
In 2003, Veolia Water signed a 50-year
contract in Shenzhen for water treatment,
supply networks and customer relations.
The scope of this contract has been extended
beyond the economic zone and now also
includes Bao’an and Longgang. In all,
Veolia Water now serves 7.61 million people
in the area with a daily production capacity
of 5,680,000 cubic meters.
FRANCE
In a first for drinking water, the process
deployed by Veolia Water at its
Neuilly-sur-Marne/Noisy-le-Grand
plant for the safe recycling of settling
tank sludge in agricultural land
application obtained the Qualicert
certification. This service certification
guarantees farmers a quality process
with full traceability.
In Nice,
Veolia Water has installed hydroelectric
microturbines on its water supply network.
This system makes good use of the
mountainous terrain to generate enough
hydro power to meet the electricity needs
of 400 households. In the long term it should
generate the equivalent of the Nice light rail
system’s electricity consumption.
26 Veolia Water 2009

BANGLADESH MOROCCO
BRAZIL
In Goalmari,
the pilot drinking water production plant designed
to serve isolated rural communities in Bangladesh
was inaugurated by Antoine Frérot and Muhammad
Yunus, co-founders of Grameen Veolia Water Ltd.
In this region, where most of the groundwater is
naturally contaminated with arsenic, the plant will
supply 40,000 people with water that meets
WHO standards. Veolia Water signed a research
partnership agreement with the ESSEC Paris
business school’s Institute of Innovation and
Social Entrepreneurship to analyze and develop
this social business experiment in water.
ONEP awarded the consortium headed
by Seureca, and also including engineering
consultants Gauff (Germany) and
CID (Morocco), the contract for research
and supervision of work to improve
the output of its water production and
distribution system in five cities in the
Fes and Oujda regions. This 51-month
project is funded by the KfW banking
group.
The oil company Petrobras awarded
Veolia Water Solutions & Technologies,
under a joint venture with Enfil, the design
and construction of a water treatment
and recycling unit at its Abreu e Lima refinery.
This is the twelfth project awarded to VWS
by Petrobras.
27

28 Veolia Water 2009

Our achievements
in 2009
30 / Water resource management
and protection
36 / Sustainable commitment to
clients and society
42 / Pushing back the boundaries
of our business
29

Our achievements /
Water resource
management and protection
Veolia Water manages
all water cycles and in 2009
we offered public
authorities, industrial
companies and consumers
alike our expertise to
address major concerns
like reducing pressure on
water resources, optimizing
network efficiency, ensuring
the quality of water bodies
and developing the use
of alternative resources.
Water resource management and preservation
is our top priority
The principal way of reducing pressure on water resources is to
combat wastage. To save water and thereby reduce freshwater
withdrawals, we have made reducing leakage from water
supply networks one of our priorities and we are constantly
increasing our expertise in this area. In the EU’s first 15 member
states, we have committed to maintaining an average network
efficiency rate of over 80%. In 2009, in France, most new
(Royan, Chaumont) or renewed contracts (La Roche-sur-Yon)
now include innovative policies. These include investment
in the isolation of network sections and remote management
to monitor distributed volumes; use of remote meter reading
technologies through our subsidiary HomeRider; and leakage
detection solutions (see Focus on page 31).
We also offer our clients services in the management of water
supply network assets. First, we consult with the public
authorities in order to ascertain their investment choices and
performance objectives (network efficiency levels, number of
service interruptions, etc.). Then, we use decision aids: a shortterm
device designed to calculate the breakage risk of each of
the network’s pipes and a long-term device that simulates
investment programs so that performance targets can be met.
As an indispensable complement to these measures we are
also developing ways of raising consumer awareness of the
issues (see page 38).
The ability to cater for the complex issues
faced by our clients
Our industrial clients also have to comply with environmental
regulations that require them to limit their water withdrawals
from natural resources. Veolia Water offers solutions to ensure
their water supply, combining productivity, energy savings
and reduction of water withdrawals. Given our personnel’s
technological expertise and professionalism we can provide
solutions for the most complex issues. For example, in China,
steelmaker Capital Steel chose us because we can provide
it with a supply of decarbonated water, thus reducing the
consumption of its cooling circuits (Actiflo Softening® Process).
We work with over 450 industrial companies and adapt to the
specificities of each industry, for example the solar power
industry in France (see page 32). In Europe, the huge success
with clients in the oil and power industries of our Aquamove
mobile emergency water treatment units in 2009 reflects how
well our skills matched their requirements. This service by our
subsidiary Veolia Water Solutions & Technologies enables the
supply of the necessary quantity and quality of water on an
industrial site that cannot afford to halt its production line.
A partner for all wastewater projects
A large share of the world’s population has no access to a
wastewater collection or treatment system. The health
hazard this represents has lead to the mobilization of a
growing number of our public authority clients. We already
30 Veolia Water 2009

FOCUS
Royan: Making network efficiency our priority
The city of Royan on the west coast of France awarded Veolia Water a 12-year contract for the
management of its water production and distribution service. The main objective is to optimize
the efficiency of its aging network. Special devices (remote diagnostics, video inspection, leak
pre-location, etc.) will help detect system failures in real time and prompt the necessary repairs.
Veolia Water will install meters on municipal watering standpipes and supply public buildings
with remote meter readers and smartcard-activated standpipes for street cleaning requirements.
The contract includes calculating the water service’s carbon footprint and taking into account
biodiversity through the separate management of green areas at water production sites.
In addition, operations will be audited by an independent organization three times throughout
the duration of the contract and customer satisfaction surveys will be conducted every two years.
Combating leaks
Over 20% of distributed water is lost
in the networks of many cities around
the world. We strive to reduce this
wastage, particularly by reducing leaks
from the network. In order to do so
we offer various techniques such as
on-location leakage detection through
acoustic correlation studies;
the measurement at different times
of the day of the amount of water
introduced into the network, as well as
flow and pressure levels; detection
of abnormal flows; and the isolation
of network sections. This last measure
involves splitting the network up
into small sections so they can be
monitored more precisely
31

Our achievements / Water resource management and protection
Solutions for
the solar power
industry
Veolia Water and its subsidiary VWS
have worked together to design services
especially for the solar power industry.
VWS offers a wide range of solutions
for clients in this sector, which is
characterized by rapidly evolving
technologies. Examples of solutions
include ultrapure water for the production
process, recovery of materials from
the effluents, and assistance with
technological transformations.
Photowatt®, the industry pioneer
in France that supplies and installs
photovoltaic systems for installations
connected to the electricity grid, has
entrusted Veolia Water with the
management of its water cycle. Veolia
Water thus moved from an equipment
rental contract in 2006 to a full-fledged
contract for ultrapure water supply and
effluent management with a performance
guarantee agreement in 2009. Our
successful partnership with Photowatt®
reflects our ability to meet the specific
requirements of this fast-growing sector.
provide wastewater services to over 68 million people
worldwide. In 2009, we confirmed our position as world
leader in this market with contracts in Qatar, Japan and
the United States. In Europe, the framework directive,
which gives Member States until 2015 to restore the “good
ecological status” of their water bodies, encourages them
to increase measures to bring their wastewater systems
up to standard. As a result, Veolia Water, which already
treats the wastewater of 30 million people in, for example,
Belfast, The Hague, Prague and Budapest, was asked
to do so in Madrid, San Remo and Roquebrune-Cap-Martin
in 2009.
In rural areas, when the area is too small or difficult
to access, small-scale wastewater treatment systems are
an indispensable alternative to public facilities. Veolia
Water is investing in this field and continues to enlarge
its range of services for clients in this specific market,
particularly in France where the law will gradually require
all private homes to ensure that their systems meet
the norms.
Industrial companies have to comply with equally strict
legislation and also have to manage increasingly complex
issues regarding the treatment of their effluents. We are
committed to helping these companies limit their impact
on the environment. In particular, we offer a service
that detects hazardous substances in effluents. We offer
these clients, who are under increasing economic pressure,
solutions that help them to control their costs and, wherever
possible, to recycle. For example, in Brazil, VWS’ technical
know-how enabled us to forge trusting relations with
the national oil company Petrobras. In 2009, VWS won
a twelfth contract for the design and construction of a
water treatment and recycling unit for the oil company’s
Abreu e Lima refinery, which will reuse about one-third
of the water consumed on the site. In a bid to cater for our
clients’ desire to “produce more with less,” we continue
to focus on an industrial ecology approach. For example,
VWS’ interest in improving carbon footprints has resulted
in a large-scale initiative and we offer a growing number
of innovations and schemes in energy saving and materials
recovery (see page 43).
Expertise in alternative resources
Recycling of treated wastewater is one way of securing
the water requirements of arid areas and improving
supply independence. Veolia Water offers tried and tested
technological solutions to produce water from effluents
that is suitable for industrial purposes, agricultural
irrigation, recharging aquifers, watering of urban green
areas and even drinking water. Industrial companies are
aware that some of their water needs can be met with
recycled water, thereby avoiding the need to tap hard-toaccess
water resources and allowing them to optimize their
32 Veolia Water 2009

Consolidated revenue
€7.9 billion
€4.65 billion
Networks/Engineering/Design-build
Operating contracts
entire water cycle. In countries like the Gulf States, where
recycling is a key part of their strategy to handle the scarcity
of water resources, we contribute our technological
expertise in the design and management of complex
systems. For example in Doha, Qatar, Veolia Water operates
two wastewater treatment plants that produce recycled
water, which is then used to water public gardens. Likewise,
in 2009, we started operating our first water recycling
plant in Brisbane, Australia as part of the Western Corridor
project (see page 24).
Seawater desalination is a particularly promising source
given that 60% of the world’s population lives less than
60 km from the coast (Source: Cluster Maritime 2009)
and yet only 1% of drinking water is currently produced
using this process. With 15% of the world’s installed
capacity, Veolia Water has become a benchmark in this field,
particularly in dry coastal regions like Australia’s Gold Coast
(see page 35) or in the Sultanate of Oman where we started
operating a desalination plant in October 2009. Our
subsidiary VWS also contributes its technological expertise
in desalination to industrial companies in countries where
there is significant pressure on water resources.
For example, VWS subsidiary Entropie will build two plants
for Alstom Power System in Shoaiaba, Saudi Arabia,
producing 3,560 cubic meters of distilled water a day.
In addition to this success, Veolia Water and VWS
constantly strive to improve the performance of their
Full treatment of Sipchem’s Acetyl complex effluents
In Saudi Arabia, Saudi International Petrochemicals (Sipchem) awarded Veolia Water AMI (Africa,
Middle East, India) a five-year contract for the operation of the effluent treatment plant at its
petrochemical complex (Acetyl Complex) in Jubail. The plant is currently in operation and has
been designed to treat 21 different flows via three units dedicated to sulfate removal, carbonate
removal and biodegradable organic removal, combined with sludge treatment.
33

Our achievements / Water resource management and protection
clients’ desalination processes, both in terms of their
impact on the environment and their consumption
of chemicals and energy. VWS, for example, is developing
new solutions in this area and in 2009 it purchased the
rights to commercialize a Zero Discharge Desalination
process that minimizes concentrate discharge into
the natural environment. Research into ways of further
reducing our plants’ energy consumption also continues;
we have already reduced the electricity consumption
of membrane desalination alone to 25% of what it was
in 1970.
Water withdrawals from underground aquifers often
largely exceed natural replenishment capacities. In areas
where water is scarce, recharging aquifers with treated
water (surface water, stormwater, wastewater, etc.)
therefore represents an alternative solution to reduce the
gap between the demand and the available resources.
Veolia Water already uses this technique successfully
in more than 30 locations, including Adelaide, Berlin and
Barcelona, and we continue to advocate it in technical
recommendations compiled in 2009.
Protecting biodiversity
By their very nature, our activities have an impact on
ecosystems. That is why protecting biodiversity and
preserving our natural environment are major concerns for
our company.
From the installation of systems that monitor aquatic
environments to the development of green areas and
sensitivity analyses, we provide our clients with a
commitment to assessing and, if required, minimizing
the environmental impacts of water and wastewater
services. For example, when Sade’s well-drilling
department constructs a system to produce water,
it always takes into account all environmental parameters
in the catchment basin, analyzes the nearby and
immediate environment (subsoil vulnerability, protection
area required, etc.) and then takes responsibility for
rehabilitating the existing environment. In 2009, the
Regional Council of Reunion Island called on our expertise
in this field for a Water Search Program designed to assess
the island’s raw and drinking water resources.
In our management contracts, the differentiated
management of green areas, which is more respectful
of ecosystems, is included in our service for the sustainable
management of natural habitats. We work with local
associations to implement this form of management
on small areas like the catchment basins of Nevers and
Lyons in France, Milwaukee in the United States
or Braunschweig in Germany. The aim is to restore
the habitats in order to reap greater benefit from
the ecosystem services they render as well as to raise
stakeholder awareness of the need to protect biodiversity
and the environment. For example, Veolia Water and the
French Golf Federation are launching a partnership
designed to promote biodiversity by developing alternative
maintenance methods and the reuse of treated
wastewater for irrigation.
Protecting diversity is also a key concern in the
management of the quality of coastal waters. For several
years now, we have been helping public authorities
anticipate regulations, particularly in Europe (Bathing
Water Directive), and set up their own systems to monitor
pollution sources and bathing water quality in both dry
and wet weather. These efforts proved fruitful when
the urban community of Dieppe-Maritime and the towns
of Pornic and Perros-Guirec became the first public
authorities in France to obtain “bathing water
certification.” This facet of our know-how is valued
by tourist resorts the world over as they become
increasingly aware of how detrimental a decline in the
quality of their coastal waters could be to their image.
34 Veolia Water 2009

A WORD FROM…
Christine Mesek,
Manager of SE/BS
Stadtentwässerung Braunschweig
The Braunschweig
experience
We have gone for many
years far beyond the
traditional operation of the
wastewater system and
the running of the
treatment plant.
Groundwater maintenance,
dam regulation to avoid
floods and operation of
draining and leaching fields
to supply agriculture with
water and nutrients are
also an integral part of
our activities as part of the
wastewater treatment
mission entrusted to
us by the city of
Braunschweig.
Once the wastewater has
been treated at the
treatment plant, it is
spread over a drainage
area, where it undergoes
biological filtration by
percolating through the
soil and being broken down
by microorganisms before
reaching the Oker River.
As a result of the
permanent supply of water,
even during periods
of drought or low water,
precious biotopes have
developed in the drainage
areas, a large portion
of which has now
been classified as a nature
reserve.
Gold Coast: Desalination ensures a lasting supply of water
The largest desalination plant on the east coast of Australia was designed by VWS in partnership
with local companies. It has been operated by Veolia Water since February 2009 under a 10-year
contract. The plant produces 125,000 cubic meters of drinking water daily by reverse osmosis,
providing over 650,000 people in Brisbane’s suburbs with a climate-independent water supply.
This region has suffered from prolonged drought and the project is a key component in the State
of Queensland’s strategy. The contract includes performance criteria and measures to protect
marine biodiversity.
35

Our achievements /
Sustainable commitment
to clients and society
While the environment
and water are now a major
concern among the wider
community, they have
always been the prime
focus of Veolia Water’s
business. In 2009, our
commitment was visible
on all fronts, from the
quality of customer service
to raising people’s
awareness of
environmental issues,
and ensuring access to
water for all.
Committed to quality of service
One of Veolia Water’s main priorities is to ensure we
provide a level of service quality that is just as good as the
quality of the water we distribute to our customers.
Regular customer satisfaction tracking provides us with
the information we need to adapt our services to their
demands.
In 2009, we continued to deploy the Customer Service
Commitments “More than Water”. After France, the rest
of Europe and Asia are now on track in this area,
especially China with the Shenzhen contract (7.61 million
people served) and the Czech Republic, where the
customer service charters have been adapted to the local
context. The Philippines is another example, with the
Clark Water Company contract being one of the first
to implement the charter after adapting it to the needs
of major industrial clients. Again with regard to our
commitment to continually improve the service delivered
to consumers, in France, Veolia Water joined with
the FP2E (professional federation of water companies),
the AMF (association of French mayors) and the ADCF
(the assembly of districts and communities of France)
to create Médiation de l’Eau (Water Mediator).
This independent, last-resort organization is tasked
with settling disputes between customers and water
utilities.
Listen
Because listening is fundamental when targeting
excellence in customer relations, Veolia Water relies on
customer satisfaction surveys as the basis for its action
plans. In 2009, as part of the promotion of the customer
culture within Veolia Water, a “mirror survey”
was performed on a sample of 3,000 employees and
6,000 customers in 11 countries. The results of this survey
were used to identify the differences in perception
and establish pathways toward their convergence.
Welcome and serve
At the same time, Veolia Water continued to upgrade its
Customer Service Centers, especially in Saudi Arabia, where a
single call center and a new customer service center were
opened and three older centers upgraded. In Liuzhou, China,
the installation of a new information system adapted to the
particular country context resulted in a very significant
improvement in customer relations’ management (see page 37).
Innovate
In addition to ensuring the availability and
professionalism of its teams, Veolia Water continually
introduces innovations to provide customers with the
means to control their water consumption.
Providing customers with methods to view their precise
36 Veolia Water 2009

Liuzhou in the
forefront of
customer
management
Under the Veolia Water Customer Service
Charter, the 220,000 customers of this city
in southern China now have access to
improved management of their water
service: new invoice design, more detailed
reports, improved tracking of contacts and
responses, improved control of meter
reading and invoicing, etc. This progress
has been made possible by the use of the
Veolia Customer Management Software.
Throughout 2009, this solution was
tailored to fit the size and the specific
requirements of the local context to allow
for the creation of thousands of new
connections, the management of new
payment methods, the issue of official
invoices after payment and logging test
results on meter precision. The new
system is also used to manage individual
meters connected to a main meter. The
Liuzhou contract is Veolia Water’s first to
experiment in using this solution fully for
customer management.
Remote meter reading: New-generation water consumption
management
Remote meter reading requires a meter fitted with an electronic module that reads the data
either continuously or on demand. The data can then be transmitted daily by a radio signal
for real-time meter reading.
Daily meter readings are a radical change for both consumers and Veolia Water. Remote reading
provides consumers with a sense of security because of the new services it can provide:
immediate alerts in the event of a leak and tracking consumption on the Internet. The operator
is also able to monitor the volume distributed and sold on a daily basis. With this new detailed
data, operators are now in a position to improve the reliability of their invoicing.
37

Our achievements / Sustainable commitment to clients and society
Committed to
performance
Veolia Water’s clients have ongoing
need for competitive services. To support
them over the long term, as well as to
demonstrate the quality of its expertise
and the advantages of public service
management contracts, the company
commits to meet performance targets.
The City of Riyadh, Saudi Arabia, clearly
understands the benefits. In 2009,
it extended the scope of the water
and wastewater contract it had signed
with Veolia Water a year earlier.
While retaining the same performance and
savings incentive system, Veolia Water will
now operate all the city’s wastewater
treatment plants, treating 700,000
cubic meters a day.
Similarly, the solutions provided by Veolia
Water clearly matched the expectations
of its steelmaker customer Industeel,
a subsidiary of the ArcelorMittal Group,
when it included performance and
continuous improvement commitments
and sharing of resulting savings in the
management contract for the cooling circuit
at the company’s Le Creusot site in France.
consumption and even to detect any leaks in their pipes
presupposes that their connection is fitted with a metering
system. In the past 20 years, with the installation of
20 million meters in the communities it serves worldwide,
Veolia Water has acquired extensive expertise in this area.
In France, our laboratory in Nancy and the Meter
Department of our subsidiary Sade in Ivry have now both
been officially accredited to manage meters (French law
now requires public authorities to provide annual proof
that their meters comply with the applicable regulations).
Building on this expertise, Veolia Water continues to innovate
and provide increasingly effective services to its customers. In
2009, we made particular progress in the area of intelligent
metering, including remote meter reading; this service has
been rolled out in France, for example in the cities of Metz,
Deauville and Beaune (see page 37).
Inform consumers about their water service
As well as these actions, consumer Web sites have been
improved with the addition of new content designed to help
understand the water service better. For example, in France,
the “www.mafacturedeau.fr” site (in French only) includes
explanations about the water bill and entertaining videos
about water distribution, wastewater collection and
treatment, and the role of public authorities. Again in France,
Veolia Water introduced the “water carafe label” on the
www.serviceclient.veoliaeau.fr Web site (in French only).
With this new service, the company provides consumers in
7,000 communities with details about the mineral content of
their tap water along with practical advice for its correct use.
Boost awareness of the main water issues
In addition to the entirely practical information we provide
our clients and customers, as part of our role as the global
benchmark in water services, we also help boost awareness
about the increasing scarcity of fresh water resources and
about sustainable development. We have been implementing
action plans in these areas for several years. Examples include
in Central Europe, as a partner in the Biodiversity Home, and
in Morocco, with the “Classes Ecol’Eau” and “Ecolo’plage”
education programs for school children. We also regularly
organize open days for consumers in China, the Czech
Republic and other countries. In the Czech Republic, the “Tap
water? Just ask for it!” campaign to promote tap water has
been a resounding success. More than 150 restaurants in
Prague and Plzen now serve tap water in carafes bearing the
Veolia Water logo, the quality of which is endorsed by an
analysis certificate.
Committed to access to water for all
Veolia Water’s mission extends well beyond providing
water services. The company is committed to working
38 Veolia Water 2009

The municipality of
Bucharest, as the owner of
Bucharest’s water and
wastewater infrastructure assets,
confirms that the services provided by
Apa Nova Bucuresti are delivered in
accordance with the quality standards
and the legal requirements of the
Republic of Romania, it being
additionally stated that these standards
are entirely in line with European Union
standards and legislation.
Bucharest: An exemplary contract
In 2000, the City of Bucharest, Romania, awarded Veolia Water’s subsidiary Apa Nova Bucuresti a
contract to upgrade and manage the city’s water and wastewater facilities. The two parties then
signed a 25-year contract based on achieving and maintaining 24 service level parameters.
In 10 years, our teams have worked with the municipality, focusing on network efficiency, water
quality and customer service. Our daily commitment has enabled us to achieve excellent results:
20 of the service levels specified in the contract have been met, while the remaining four are still
being assessed. As a result, a relationship based on trust has been formed with the municipality.
Against this backdrop, the two parties jointly committed to a contract renegotiation process.
This resulted in the signature of a rider regarding 11 essential points, including funding major
extensions to the water supply network and wastewater collection system for the period 2010 to
2016; the construction and operation of a new wastewater treatment plant to protect the
Danube Delta; the rehabilitation and operation of the principal wastewater collector; and the
replacement of 50,000 lead drinking water connections. Apa Nova Bucuresti has also committed
to creating a Water Solidarity Fund to which it will contribute €100,000 a year, to help the most
disadvantaged families pay their water bill. Negotiated on a win-win basis, the new contract
terms will enable Bucharest to reconcile the major investments it still needs to make to improve
its water services while maintaining one of the region’s most competitive water price structures.
Sorin Mircea Oprescu,
Mayor of Bucharest
2.3 million
inhabitants served,
€210 million invested in
infrastructure over the past 9 years
by Apa Nova Bucuresti,
network leakage reduced by over
100 million cubic meters,
power consumption reduced
by 30%.
39

Our achievements / Sustainable commitment to clients and society
FOCUS
A first in India: Continuous
supply in urban areas
In 2005, Veolia Water signed a
performance contract with Karnataka
State aimed at providing continuous
(24/7) drinking water supply within
four years to a series of five pilot areas
or “demo zones.” Until then, the
inhabitants of these areas had access
to running water only a few hours
a week at best.
The project, funded by the World Bank,
concerned 180,000 people in all types
of socioeconomic categories.
By optimizing operations, that is,
reducing water loss from 50% in 2005
to 12% today, installing individual
connections and meters for all
households, providing information to
consumers and boosting their awareness
of responsible consumption, the entire
population in the demo zones now has
permanent access to drinking water at
home. Given these results, Karnataka
State has decided to extend this scheme
to other districts and towns
in the public interest in order to contribute to developing
access to water for all. As a result, at Veolia Water,
we have included solidarity as one of our core values.
This includes during emergency situations. When storms,
earthquakes, extreme cold fronts, and other such events
occur our personnel demonstrate, either directly
or through Veoliaforce (Veolia Environnement’s emergency
humanitarian aid structure), their rapid response
to maintaining water service continuity. However,
Veolia Water’s solidarity with disadvantaged people does
not only come into play in times of exceptional events.
Working closely with public authorities, whenever
circumstances require, we include a social component
in our services and strive to find innovative solutions
to ensure that there are no interruptions to water supply.
For example, in France where the law recognizes the right
of each citizen to water, the company is a signatory of the
FSL (housing solidarity fund) agreements in 59 of France’s
administrative departments. In this context, we commit
in each signatory department to waive the debts of
individuals or families who struggle to pay their water bill
when they receive FSL support. In 2009, the water bills
of 22,000 families were written off, totaling more than
€1.5 million. In similar vein, in Bucharest, Romania,
the creation of a solidarity fund was included in a rider
to the concession contract negotiated between the
92%
Percentage of contracts Veolia Water successfully
renewed in France in 2009, a clear demonstration
of its clients’ satisfaction.
municipality and Veolia Water (see page 39).
In line with its commitment to the Millennium Development
Goals, Veolia Water remains focused on ensuring access to
basic services for all. In this respect,
the company rises to the considerable expectations
of authorities that entrust their water services to us.
In Morocco, Gabon, Niger and India, from the start of our
contracts through to the end of 2009, we have provided
access to safe drinking water to more than 2.5 million more
people and access to sanitation to an additional 1.2 million.
To achieve these goals, Veolia Water has developed
a specific service, called “ACCES,” that includes expertise
in all technical and financial areas of its business along with
customer relations. ACCES has five components: Adapt
services, Capitalize on existing infrastructure, Create
innovative solutions, Evaluate the impact of
the programs implemented (see page 41), and Strengthen
consumer awareness about proper water usage.
Perform pilot experiments
Again within this context, Veolia Water is involved in testing
new economic models to promote access to basic services,
with the aim of replicating them on a larger scale.
For example, in Goalmari, Bangladesh, we inaugurated the first
drinking water production plant created under our social
business experiment with the Grameen Bank founded by
40 Veolia Water 2009

Professor Muhammad Yunus. In Bangladesh, most aquifers
are contaminated with arsenic at levels that are dangerous
for human health. The joint venture between Grameen Bank
and Veolia Water was set up to develop an alternative to this
situation by producing water compliant with World Health
Organization standards in treatment plants and distributing
it through networks that will eventually serve 100,000 people
in five villages. In accordance with the social business model,
the water is not free; Grameen Veolia Water Ltd sets the price
taking into account the people’s ability to pay and all the profits
are plowed back into the project. We have now reached the
stage where we need to improve the technical aspects of this
pilot scheme. To identify the keys to the operation’s success
and above all to be able to replicate it, Veolia Water signed
a research partnership agreement with the Institute of
Innovation and Social Entrepreneurship at French business
school ESSEC in early 2010. In Morocco, to extend the subsidized
water connection system (see box), Veolia Water is testing an
Output-Based Aid (OBA) program with the World Bank. Aimed
at improving the effectiveness of funding for development
initiatives, OBA is paid in the form of donations reflecting the
progress made in connecting families to the public drinking
water networks and wastewater systems. At the end of 2009,
the progress rate for the OBA program in Tangier was 70%,
placing Veolia Water in the lead of the various operators
selected by the World Bank for the Morocco operation.
Subsidized connections
in Morocco: Positive
impact
In Morocco, the subsidized
connection operations run for
the past few years by Veolia
Environnement Morocco have
enabled almost 60,000 low-income
families (totaling around 300,000
people) to be connected.
That represents almost half
the 120,000 families who were
not connected to the public water
distribution network in 2002.
The impact of this program was
assessed in 2009 by JPAL (Jameel
Poverty Action Lab), the social
laboratory of the Massachusetts
Institute of Technology (MIT).
The analysis, performed using
the scientific random testing
method developed by French
economist Esther Duflo, revealed
the positive impact of these
subsidized connections on human
development, especially in terms
of the beneficiaries’ social
integration and improved quality
of life. This result is particularly
important for the Moroccan
authorities, which introduced
a National Human Development
Initiative in 2005.
41

Our achievements /
Pushing back the boundaries
of our business
The global economic crisis
and awareness of
sustainable development
challenges are giving rise to
new customer expectations.
In response, Veolia Water is
leveraging its expertise and
sense of innovation to push
back the boundaries of its
activity, while always
seeking to reconcile human
progress with the planet’s
future.
Taking up the energy challenge
All means of energy production require water and vice
versa. In the United States, a third of water withdrawals are
used to produce energy (source: US Department of Energy,
2006). For most clients, given the threat of climate change,
the aim today is to view the issues from an overarching
perspective and to manage the water/energy equation.
In this context, at Veolia Water, we are continuing to make
progress in optimizing our energy production and
consumption. Worldwide, we operate more than a hundred
anaerobic digesters treating wastewater sludge, a
significant part of which can be harnessed to recover the
energy from the biogas. In western France, leading poultry
supplier LDC opted, when renewing its contract in 2009,
to recover the effluent from its production line to produce
biogas. A cogeneration plant is now being built to produce
electricity and heat, which will be sold through
a partnership contract with EDF Energies Nouvelles.
In Madrid, Spain, the country’s largest wastewater
treatment plant, contracted to Veolia Water in 2009,
includes a sludge digester and an associated cogeneration
plant that will generate electricity and produce heat
(18,500 MWh of electricity per year, which is more than half
the plant’s annual consumption).
Veolia Water is in the forefront of energy efficiency
programs in Central Europe. Its subsidiaries in the Czech
Republic and Hungary continually share best practices
to extend the range of operating methods and the portfolio
of technology. For the Budapest, Hungary, contract,
they implemented the Ecrusor® system that recovers
biodegradable liquid after breaking down solid waste,
and significantly boosts biogas production.
The experience acquired in cogeneration in Central Europe
has been key to pushing ahead and designing the energy
self-sufficient wastewater treatment plant. The aim is for
the plant to cover all its energy needs by consuming less,
using technologically optimal processes, like the Amonit
process (see page 22), and by maximizing the production
of biogas. With regard to this latter point, a new two-step
sludge digestion process was patented in March 2009.
Currently at the industrial prototype stage, it should be
operational in 2010.
Contribute to reducing greenhouse gases
Analyzing their own sources of emissions in order to reduce
them has become a central issue for companies, which
will increasingly shift to the use of green technology.
Veolia Water has the resources to help them minimize their
42 Veolia Water 2009

carbon footprint. Several of our subsidiaries invested
in this area in 2009.
VWS, for example, has invested in a major “Carbon
Initiative” project (see box). To calculate precisely
the carbon footprint of the operational activities under the
Greater Lyons contract (France), Veolia Water created a tool
called EC’Eau. It has shown that the production
and distribution of drinking water generates annual
emissions of 9 kilograms of CO 2
equivalent per inhabitant
(i.e., 1/1000th of the annual emissions generated by each
person in France). The diagnosis also highlighted the areas
where reductions can be made. Veolia Water plans to deploy
this tool in all its facilities in France.
In another example, pre-empting new French legislation
that will require by 2011 all companies with more than
500 employees to report their annual carbon balance,
Sade has established a method and built a calculation tool
based on the “Carbone 6” proprietary software. It can
be used to express the amount of greenhouse gases (GHGs)
avoided by implementing alternative techniques that the
company has designed or developed to replace conventional
processes. Sade also continued to innovate in reducing the
environmental impact of its own activities: after the trenchless
micro-tunneling technique used, for example, for the Budapest
VWS and carbon efficiency
When VWS started its “Carbon Footprint”* project in 2009, it began by auditing the available
solutions in 14 of its entities, and then identified the technological levers that would enable
them to reduce their footprint. The idea then emerged that VWS could apply this process at
its clients’ facilities and help them work out their “total carbon cost.”
Thanks to its expertise in the relevant technology, VWS has already selected the most suitable
processes to solve the issues confronting its industrial and public-authority clients. It can now
identify for them the solutions which, by emitting lower levels of GHGs in their operation cycle,
ultimately mean lower operating costs or fewer new costs associated with CO 2
emissions.
VWS has already had the opportunity to leverage this expertise in the Rosny-Mantes Urban
District project (CAMY Authority, in the Parisian region). In a concern for sustainability, the local
authorities wanted to upgrade their wastewater treatment plant at Rosny-sur-Seine to mitigate
its environmental impact. In cooperation with Veolia Water who operates the plant, VWS found
the right solution to respond to CAMY’s expectations and won the contract.
Today, VWS is in a position to submit bids mainstreaming the appropriate solutions meeting
the carbon footprint concerns of any client.
* The carbon footprint is the sum of all direct and indirect GHG emissions attributable to an individual, organization,
activity or product.
43

Milwaukee: From wastewater to research,
an innovative partnership
When it signed the country’s largest wastewater service contract (population of 1.1 million)
at the very end of 2008 with the Milwaukee Metropolitan Sewerage District, Veolia Water included
the finance for a research program for the neighboring Great Lakes region scheduled to last
around 10 years. Working with two US universities, the company has already selected three initial
projects to study the growing presence of pharmaceutical pollutants in the aquifer, an issue
of increasing concern to the local population. The research projects will aim to:
– identify the compounds present in the storage tank and their potential removal in the
wastewater treatment process;
– improve the wastewater treatment processes to reduce the percentage of solid residue
and increase the availability of biogas; and
– understand better how chemical substances, such as phosphorus (the source of bad odors),
are transferred from a tank to a river.
contract, the company has developed the Recyclor process
to recycle on-site the road mix extracted from its work sites
into an immediately reusable backfill material.
Veolia Water is exploring other avenues for renewable
energy production at its sites. We have, for example,
installed hydraulic water turbines in Nice (France), Brussels
(Belgium) and in Australia. In Germany, our subsidiary
OEWA has patented a drinking water heat pump. Designed
for local public authorities and industry, this innovation
converts the calories in drinking water into a source of heat
or cooling. Veolia Water is also able to provide public
authorities with the possibility of recovering heat from their
wastewater. In France, the cities of Deauville and Nantes
(La Petite Californie plant) have adopted this solution.
Veolia Water is also exploring the possibilities offered by
solar and wind power. Sade is capitalizing on its civil
engineering works expertise to develop its business in the
construction of wind farm infrastructure. It has already
won two tenders from EDF Energies Nouvelles and a new
contract with Enercon.
Innovate but adapt to local contexts
Wherever Veolia Water is present, it carries out its core
business providing optimum solutions to its clients’ water
44 Veolia Water 2009

FOCUS
problems. Whether in seeking finance, local partners
or new services, the company always focuses on establishing
innovative approaches adapted to specific local needs
and new expectations.
In the United States, Veolia Water’s ability to extend the
range of services it provides was a decisive factor when
the Milwaukee Metropolitan Sewerage District was looking
for a new company to manage its wastewater system,
serving around 1.1 million people. Constantly attuned
to its client’s needs, the Veolia Water teams assessed
the MMSD’s environmental concerns, especially aquifer
pollution. To provide this client with the best possible
service, we compiled a proposal, based on operational
excellence, that included finance for the R&D program
on this particular topic right from the start (see page 44).
In the Middle East and the Gulf countries, where
increasingly open markets and institutional reforms are
to be found, those countries that are prioritizing access
to water need to call on the expertise and technical
excellence of water professionals. In order to gain a foothold
more easily in these countries and work with them through
these changes, Veolia Water joins forces with leading local
partners who provide us with their local knowledge.
Currently, for example, Azaliya, the joint venture 51%-owned
by Veolia Water and 49% by Mubadala Development
Company (a sovereign fund owned by the Abu Dhabi
government), is backing the development of access to water
services in the Middle East and North Africa.
Lastly, in Germany, to adapt to the characteristics of the
local water market traditionally dominated by municipal
utilities, Veolia Water implements a tailored strategy.
In 2009, Veolia Wasser and BS Energy were selected by the
municipality of Pulheim to establish a local service company
to manage the city’s electricity and natural gas services
for the next 20 years. Although the contract does not involve
the management of water, Pulheim has decided to place
its trust in Veolia Water’s expertise in the area of public
service management contracts to help it create value over
the longer term by keeping costs as low as possible
for consumers.
Veolia Water’s subsidiaries have also developed experience
in incorporating services outside the scope of their core
activity, enabling them to win contracts, such as Seureca
in Ukraine (see Focus on page 45).
Track the emergence of new uses
To support its clients in all circumstances and ensure a
quality water service, Veolia Water must be able to identify
Pushing back water engineering
boundaries in Ukraine
Seureca has acquired recognized expertise
in improving the financial and operational
performance of municipal services
in Central and Eastern Europe to enable
them to meet the conditions set by
the EBRD for obtaining a loan.
These missions were initially centered
on water and wastewater services.
Since fall 2009, Seureca, with the support
of Veolia Energy-Dalkia, has been working
on a district heating network for the
municipal heating company in Odessa,
Ukraine. This nine-month assignment
involves auditing the service’s current
situation and recommending short-term
improvement actions enabling it
to honor its commitments to the EBRD
under the loan taken out to upgrade
the infrastructure
45

Our achievements / Pushing back the boundaries of our business
Éco Environnement
Ingénierie
Numerous projects for urban areas designed
to minimize their impact on the environment
have been developed in the past 15 years: the
BedZED ecological village (UK), the Vauban
District in Freiburg (Germany), Masdar City
planned for 2015 (Abu Dhabi), etc. Right from
their design stage, these model sites include
ambitious goals for local water management,
energy consumption and the ecological
footprint of housing and transportation.
Veolia Environnement’s Éco Environnement
Ingénierie (2EI) consultancy and engineering
firm specializing in sustainable urban
development was created to provide, through
partnerships with urban planners and
architects, solutions to sustainable urban
project developers. With the support of the
technical departments of Veolia
Environnement’s four divisions and R&D, 2EI
directs development projects toward an
economic and environmental optimum
incorporating local solutions (recycling
stormwater and surface runoff after
treatment, solar panels, pneumatic waste
collection, etc.), and solutions based on the
installation of public utility networks (water
management master plan, mass transit,
heating networks fired by biomass, etc.). Since
its creation in 2009, 2EI has been awarded an
environmental and urban analysis contract
for the Esplanade mixed housing
development in Grenoble, France, and the
environmental assessment (with a major
section on modal shifts) for the creation of the
future Nice TGV high-speed rail multimodal
center (France).
their future needs. This brings the company to review
the scope of its business at regular intervals. In Europe,
for example, in the past few years, there has been increasing
focus—with varying degrees of controversy depending
on the country—on the issue of rainwater harvesting
for domestic or industrial uses. As a responsible operator,
Veolia Water is obliged to take a stance on this issue.
In France, where legislation now allows this practice
for certain applications, the company is seeking the best
way to reconcile the use of this alternative water resource
and public health issues. We have installed several units
for single dwellings and for apartment blocks.
It is often in helping clients deal with emerging issues or
to comply with increasingly stringent environmental
regulations that Veolia Water advances even further down
the path to innovation.
After having established its offer for identifying hazardous
substances in effluent (see page 32), Veolia Water is now
assessing the solutions it may be able to present to
its clients to help them reduce the use of these same
substances in their processes or to treat them.
Additionally, we are examining the possibility of recovering
these substances efficiently and cost-effectively,
through differential flow treatment.
25,000
The number of employees worldwide involved
in Veolia Water’s Innovation and Continuous
Improvement approach. Almost 3,000 ideas
for improvements have been received.
Anticipate major changes
Looking further ahead to save resources, Veolia Water
and its subsidiaries pool their expertise to make progress
in industrial ecology. They focus on identifying tailored
solutions, especially materials recovery, an area where
widely varying and complex needs require a high level
of technical expertise.
Again looking to the future, Veolia Water is preparing
a revolutionary concept: the wastewater treatment plant
of the future. This major technological leap will see
the treatment plant turn into a bio-refinery, capable
of recovering wastewater as a “raw material” for the
production of added-value products (see box page 47).
This new-generation plant is a link in the sustainable city
of the future that will include, right from its design phase,
environmental services (water, transportation, energy and
waste management). Veolia Environnement’s
Éco Environnement Ingénierie (2EI) consultancy
and environmental engineering firm is developing
this vision of the sustainable city as part of concrete
development projects. It relies on the expertise of
Veolia Water and the three other Veolia Environnement
divisions (see box page 46).
46 Veolia Water 2009

The wastewater treatment
plant of the future:
Turning wastewater into
a raw material
Today, a conventional wastewater
treatment plant (WWTP) “uses”
wastewater, energy and chemicals,
and “produces” treated water that
can be used for irrigation and
industrial applications, and waste
(sludge) that can be used, under certain
conditions, for farmland application.
In tomorrow’s WWTP, the flow
of wastewater, rich in organic and
mineral material, will become a plant
producing energy (CH4, H2 and ethanol
biofuels), organic and mineral
ingredients (fertilizers) and
biomaterials, such as PHA biopolymer,
which can be used to manufacture
bioplastics. This conversion of the
WWTP into a bio-refinery will occur
in two stages: in the short term,
it will handle a concentrated flow
(treatment byproducts). By around
2020, the aim is to directly refine
the dilute flow of wastewater.
Veolia Water is also producing PHA
in its laboratories, and is now working
on developing industrial-scale
production.
47

France
52, rue d’Anjou
75384 Paris Cedex 08
France
Tel.: + 33 1 49 24 49 24
Fax: + 33 1 49 24 69 59
Europe
36-38, avenue Kléber
75116 Paris
France
Tel.: + 33 1 71 75 00 00
Fax: + 33 1 71 75 10 45
Africa/Middle East/India
52, rue d’Anjou
75384 Paris Cedex 08
France
Tel.: + 33 1 49 24 49 24
Fax: + 33 1 49 24 69 59
North America
200 East Randolf Drive
Suite 7900
Chicago, Illinois 60601
USA
Tel.: + 1 312 552 2818
Fax: + 1 312 552 2864
Asia-Pacific
21/F AIG Tower
1 Connaught Road Central
Hong Kong
Tel.: + 852 2167 8206
Fax: + 852 2167 8101
Veolia Water Solutions & Technologies
“L’Aquarène”
1, place Montgolfier
94417 Saint-Maurice Cedex
France
Tel.: + 33 1 45 11 55 55
Fax: + 33 1 45 11 55 00
Sade
28, rue de la Baume
75008 Paris
France
Tel.: + 33 1 53 75 99 11
Fax: + 33 1 53 75 99 02
Setude
Immeuble Clichy Pouchet
16, boulevard du Général-Leclerc
Bâtiment F, 8 e étage
92115 Clichy Cedex
Tel.: + 33 1 41 40 00 30
Fax: + 33 1 41 40 00 31
Seureca
36, rue de Liège
75008 Paris
France
Tel.: + 33 1 45 72 92 92
Fax: + 33 1 45 72 92 93
www.veoliawater.com
48 Veolia Water 2009

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This document was produced by the Veolia Environnement Communications Department.
Photo credits: Veolia photo libraries: VWS, Sade, Veolia Water India, Christophe Majani d’Inguimbert, Manolo Mylonas,
Jean-François Pélégry, Alexis Duclos, Samuel Bigot/Andia, Martial Ruaud/Andia, Franck Perrogon/Andia, Richard Mas,
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Editorial oversight and coordination: Sylvaine Leriquier
Author: Marie-Laure Pierard English texts: ALTO International
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DCOM/COR/05-10/F40
Veolia Water
52, rue d’Anjou
75384 Paris Cedex, France
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www.veoliawater.com