Creating an innovation ecosystem in the water sector: lessons from the field

Innovation needs supporting ecosystems that allow the development and implementation of new solutions to provide more and better water and sanitation services.

By Hila Cohen*

The need for innovation in the water sector is evident for many citizens from Latin America and the Caribbean. As highlighted in previous posts, equitable and reliable access to water and sanitation services will only be possible using new technological innovations and updating outdated policies. To accelerate innovation in the sector, the IDB Group has created Source of Innovation, with the aim to promote the development and integration of innovative solutions in the water, sanitation, and solid waste sector that contribute to providing universal safely managed services. Source of innovation is a call to action to build alliances between public and private actors, operators and innovative companies, communities, and research centers. Source of Innovation is led by IDB Lab, the laboratory of innovation of Group IDB, and the Water and Sanitation Division of IDB with the support of the government of Israel, the Swiss State Secretariat for Economic Affairs (SECO), and Fundación FEMSA.

One of the objectives of Source of Innovation is to generate and disseminate knowledge about successful innovation experiences in the region. for this reason, we have created a series of webinars, looking at thought-provoking trends of innovation in the water and sanitation sector. In our first webinar, we took a look on how innovation ecosystems in the water and sanitation sector are generated and nurtured.

Innovation does not happen in a vacuum and needs support ecosystems that allow the development and implementation of new solutions. Water utilities and governments in Brazil, Ecuador and Israel, presented their innovation ecosystems, which allowed us to explore how the relations between key players can facilitate and create new dynamics resulting in better services for all. The discussion provided important lessons on ecosystem development and its crucial role in elevating the sector.

The keynote speaker, Ms. Nili Shalev, VP International Collaborations Division at the Israel Innovation Authority, presented the Israeli innovation system and showed the crucial role the government has played during the last few decades in its development and strengthening. She emphasized the key role of the government had through the creation of a Government Authority for Innovation and a Venture Capital industry in the 1990s, coupled with high levels of investment in research and development. She mentioned “the need for all players to work in synergy and push each other to success- Government, industry VC, Academia and entrepreneurs.”

Brazil has been moving towards providing better services through innovation. Bruno Borges Gentil, Innovation Manager of Companhia Águas de Joinville, Brazil, shared his organization’s experience nurturing a growing an innovation ecosystem. Backed by recent laws passed by the government, promoting innovation, the water utility is looking to implement “faster, cheaper and better “disruptive innovation solutions”. “Working with universities, startups and managing hackathons is a priority for this Brazilian actor.

In recent years, EPMAPS- Agua de Quito has been investing in innovation as a strategy. Gabriela Maldonado, Head of research, development, and innovation at EPMAPS talked about how the company is promoting people-focused innovation and leveraging the great entrepreneurial capacity of Ecuador, with one of the highest percentages of adults involved in new entrepreneurial activities in the world (33.6% of all adults between the ages of 18 and 64 years of age). EPMAPS is actively pursuing innovations and collaboration with universities and international and regional organizations, Government, private companies, and startups. In Quito, all the actors have a well-defined role in the system within the water and sanitation sector.  Ms. Maldonado emphasized the need of using of open innovation, creating more reliable data, and developing networks of professionals that enable the use of new technologies. As part of its innovation activities, EPMAPS created a multidisciplinary innovation lab in different sectors, including circular economy and healthcare, considering that water influences society as a whole.

Mr. Ori Shabat from the Israeli Water Authority shared the Israeli experience by presenting the challenges of developing and implementing new technologies in a small market, especially due to the slow adaption rate of new technologies in the water sector compared to other sectors.

Some of the solutions to overcome these challenges included wide collaboration between the government, academia, water utilities, and private sector, as well as investment in R&D and supporting the local industry in the international market. Last year, the Israeli government created a national water community to reach all relevant counterparts from all sectors in the country to enhance this ecosystem. They have also invested in a program of financial incentives for water utilities to use their facilities as a beta site for water startups.

The webinar closed with a conversation with SABESP’s superintendent, research, and development, Cristina Knorich Zuffo, and Alejandro Minatta, a senior innovation consultant. Both speakers highlighted some key lessons learned from the case studies presented and from SABESPs’ innovation experiences:

• Government investments in research, development, and innovation (R+D+i) is essential to building innovation ecosystems, including research institutes, hubs of innovation, and sources of public and private financing.
• Creating a community, a common vision, a long-term perspective together with monitoring indicators of the innovation ecosystem is indispensable for the successful process.
• Regulation is a key factor in reducing the risk to innovation in the sector, throughout the entire innovation generation cycle.
• A key success factor is facilitating financial support through public agents (example: ministries, innovation agencies, etc.) and private agents (example: angel investment networks, investment funds, etc.)

All the successful experiences in the webinar showed the untapped potential in the water and sanitation sectors across the region. These ecosystems are essential for achieving better and more reliable services for millions of people.  In the following webinar we looked at applications of new digital technologies in the region. Stay tuned!

*Hila Cohen Mizrav is a consultant who currently manages the IDB-Israel collaboration, focused on Improving Capacities in Water Resources Technologies. She previously worked at the World Bank, in water management, irrigation, and improvement of water supply companies in Africa. She has more than 10 years of experience in the environmental sector and has a master’s degree in environmental policy and international relations from the Hebrew University of Jerusalem.