**Hydropower, growing urban demand and pollution.** The struggle for drinking water in Greater São Paulo also came into conflict with the influential hydropower sector<sup>8</sup> . The Guarapiranga and Billings reservoirs were built for power generation purposes in the 1920s and 1930s, respectively. For decades, the Alto-Tietê - Cubatão Complex diverted a large volume of water from the Tietê and Pinheiro rivers into the Billings reservoir (with a capacity of 1 billion m3) for use by the Henry Borden hydropower plant, located in the state’s coastal area, in another hydrographic basin (see Figure 2 above). As had occurred in the late 1940s with the Guarapiranga reservoir, in the 1970s, the water in the Billings reservoir began to be needed to supply Greater São Paulo. But sanitation infrastructure in São Paulo failed to expand at the same rate as the population, resulting in severe pollution of these rivers and, consequently, of the Billings reservoir.

Even though engineers and politicians have for decades recognized the precariousness of both drinking water supply systems the priority for this complex was always given to hydropower generation (Rocha, 2002; Keck, 2002; Alvim, 2003). Pressures from environmental groups increased, however, and the state constitution of 1989 determined that the priority for use of the Billings Reservoir would be urban supply. Since 1992, the pumping to Billings has been suspended altogether, except when required for severe flood control. However, tensions continue since plans to increase energy production by pumping water from the Tietê and Pinheiros Rivers have remained on the agenda of the electricity company (EMAE- _Empresa Metropolitana de Água e Energia_ )<sup>9</sup> . Today, the main function of the Guarapiranga reservoir is to supply São Paulo city. One isolated part of the Billings reservoir supplies some municipalities of Greater São Paulo, including São Paulo city.

**Lack of sewage collection and treatment.** Investments in treatment and collection network expansion were initiated in the Alto-Tietê basin in the 1970s and increased substantially in the 1990s. However, the situation still remains characterized by deficits in coverage and in substantial increases in water quality: only 65% of wastewater is collected and of that portion, only 32% is treated (FUSP, 2002b). Several major municipalities have their own sanitation systems, and these are particularly underserved since SABESP is the only water company in the basin that treats sewage.

SABESP’s most recent estimates indicate a substantial increase in sewage collection, reducing the deficit in coverage from 17% in 2005 to 7% in 2020. There are, however, no estimates for increases in wastewater treatment (FUSP, 2002b).

**Improper solid waste collection and disposal** . Greater São Paulo has reasonable rates of collection and disposal of domestic solid waste, but the amount that is not collected or that is disposed of inadequately is still significant in absolute terms (IBGE, 2001): more than 700 metric tons of trash collected daily does not receive proper disposal and a large

> 8 Keck (2002) gives a global overview of the problem of water supply in the São Paulo metropolitan region from a historical and political perspective.

> 9 After a major drought in 2000 which culminated in a national level energy crisis the following year, a special license was granted to transfer an outflow of up to 4 m3/s in the case of a demand for emergency power (FUSP, 2002b). There are also projects for cleaning up the Pinheiros river so that it would be possible to use it as was done in the past, but now attending the environmental regulations (Agência de Bacia do Alto-Tietê, 2004).

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