AFFORDABIUTY OF HOUSEHOLD WATER SERVICES IN GREAT BRITAIN

This paper analyses the Issue of water and sewerage service charge affordability in Great Britain, focusing exclusively on the domestic or household sector. It discusses the meaning of affordability, outlining ways in which it might be measured, before presenting empirical data to calibrate the phenomenon. A discussion of affordability benchmarking for household water and sewerage services is followed by a brief critique of the various financial support mechanisms currently available to low Income households.     

Financial sustainability of rural water supply: An analysis of cost recovery,revenue collection,and efficiency

Maintaining a financial sustainable pipe water supply (PWS) is one of the serious challenges in sustainable provision of water supply in rural areas. Poor revenue collection and willingness to pay for the service is adding severity to the problem. This study analyses the factors affecting revenue collection in rural water utilities and measures its efficiency in maximizing revenue and average hour of water supply per day. The findings convey that cost recovery is a failure in rural water supply even they are not able to generate revenue. Inactive community participation, the notion of free water supply, unaccountable payment is main reason for poor revenue collection. Therefore, active community participations, educating the household on water supply, adoption of accountable payment mode will be a step towards revenue generation. To attain efficiency, the utilities can expand their output revenue and hours of water supply by 22% without altering their input. This study is an empirical contribution in the field of sustainable provision of water supplies, which address the problem of poor revenue generation in rural water supply and find out the reason for it.     

Household's willingness to pay for improved water service: a case study in Shebedino District,Southern Ethiopia

Willingness to pay for basic water services is often high if the services are appropriate and affordable. This study was aimed at assessing the household's willingness to pay for improved water service in Shebedino District, Southern Ethiopia. The survey was administered to 635 participants from March 29 to April 26, 2008. Findings revealed that the majority of respondents (83.62%) were willing to pay 10 cents for 25 L of water. The average monthly expense of water was 2.36% of their average monthly income. Willingness of households to pay for improved water services was found to be better than the current expenditure.     

Utility governance,incentives, and performance: Evidence from India's urban water sector

In developing countries, managing trade-offs between socioeconomic and environmental objectives in water utilities is challenging. The Indian water sector suffers from financial losses, lack of access, and poor service quality. We use a stochastic frontier analysis approach to study 304 urban water supply services during 2010–2015. We examine the role of socioeconomic and environmental aspects. Results indicate that water supply exhibits significant inefficiencies and, thus, scope for improvement. Measures to reduce non-revenue water, increase water quality, and improve cost recovery and bill collection, may help induce efficiency. Results also indicate that increasing water supply hours would improve service performance.     

Evaluation of non-user benefits towards improvement of water and sanitation services in informal settlements

Many municipalities in developing cities are faced with the challenge of providing water and sanitation to ever-growing populations that cannot afford to pay for the services. This challenge calls for solutions that link equity considerations to cost recovery, and may require society to re-evaluate its perspectives on the value of urban water services. This paper explores the potential of non-user benefits as drivers of value and measures the trade-offs that “non-poor” residents were willing to make for the reductions in public health, social and economic costs when levels of service in informal settlements are improved. The study finds that people are sensitive to the public health impacts, and when given the choice of location of settlement to improve, and the means through which to make payment, would be willing to pay 6500 UGX (approx. $2.83) per household per month to install yard facilities in an informal settlement located nearest to their neighbourhood and with payment made through a special purpose vehicle.     

Re-examining the ‘low water tariff’ hypothesis: lessons from Hyderabad,India

Researchers suggest urban water utilities in India operate on low tariffs, consequently earning revenue insufficient to recover operation and management (O&M) costs of water storage, treatment and distribution. From findings of a field study conducted in Hyderabad, India, the paper suggests otherwise. While ‘stated’ tariffs are low, households currently pay tariffs far higher than in other regions of the world because of institutional indifference toward improving service attributes, particularly quantity and poor measurement of domestic water consumption; following which, poor communities pay more for less. While poor cost recovery precludes improved performance of urban water utilities, targeting this facet alone at the cost of other aspects of service does not, as the paper demonstrates, necessarily lead toward qualitative service improvement or toward improved households' perception of water services.     

Managing Water Services Through Service Differentiation and Pricing in an African City

A key challenge for managers of water utilities in developing countries is to provide services to the rising urban population in a financially sustainable manner. The paper examines the management of water services in an African city which piloted service differentiation and pricing. Among the key findings was that substantial improvement in the provision of water services to the urban poor was attained. Cost recovery was achieved through innovative structuring of public/private partnerships, an appropriate pricing policy, and flexible payment systems. The project demonstrates that (a) by structuring service delivery with appropriate pricing, utilities could serve more customers (including people living in informal settlements) at affordable cost and achieve financial sustainability, and (b) service differentiation and appropriate pricing has the potential to improve urban water services in low-income countries.     

A cost‐benefit analysis of restoring the ecological integrity of Jeonju stream,Korea

This article aims to assess the economic benefits of restoring the ecological integrity of Jeonju stream, Korea and then conduct an ex post cost‐benefit analysis of the restoration. The benefits are measured by using the contingent valuation eliciting the local residents’ willingness to pay (WTP) for the restoration supposing that the restoration had not been implemented. The mean yearly WTP for the restoration is calculated to be KRW 2897 (USD 2.46) per household for the next 10 years. The costs of the restoration include the costs of restoring the ecological integrity for 2 years and maintaining it for the next 50 years. The ratio of benefit over cost, the net present value and the internal rate of return are estimated as 1.1, KRW 0.5 billion (USD 0.4 million) and 6.4%, respectively, which exceed 1.0, 0 and social discount rate of 5.5%, respectively. The results show that the restoration is socially profitable.     

Insights into water service quality in Jordan from key performance indicators and consumer perceptions

The study analyzed correlations between water supply service performance and customer satisfaction in Jordan, using key performance indicators (KPIs) and surveys of 914 consumers. The study revealed that the level of water service, including water quality, did not influence consumers' selection of drinking water source but strongly influenced their choice of cooking water. The consumers' overall satisfaction showed a significant correlation coefficient with the operating ratio (revenue/expense for operation) (R = 0.84, P < 0.01) and weekly water supply hours (R = 0.69, P < 0.05), which was influenced mainly by consumers’ perception regarding sufficient water quantity and quality.     

The Affordability of Water in an African Town

This paper examines (a) the ability of consumers in a typical medium-sized African town to pay for a piped water supply, and (b) the implications for the financial viability of the local water undertaking. It demonstrates that, at present, people are paying about 10% of their income for water, and this appears to be near their limit of affordability. However, it is shown that it is possible for the water company to improve its revenue, whilst maintaining its present tariffs, by providing more private connections. Furthermore, the aim of improving water-company revenues is compatible with providing improved services to its urban customers.     

A regulatory robust conditional approach to measuring the efficiency of wholesale water supply and wastewater treatment services

A benchmarking evaluation instrument was designed with a European Union country regulatory authority for water supply and wastewater treatment services to determine the efficient operating cost of its service providers that operated in the wholesale market segment in the 2017–2021 period. To this end, the non-parametric Data Envelopment Analysis technique was adapted to a robust and conditional approach. The results point to similar mean efficiency scores between water supply and wastewater services in the five-year period, despite the greater heterogeneity in the latter. Furthermore, the estimated potential cost savings for both services ranged from about 2% to 3%.     

Measuring the economic benefits of residential water quality improvement in Ulsan,Korea using a contingent valuation

Korean people are getting more concerned about their health and their interest in clean water is increasing continuously. The source of portable water in Ulsan is the Nakdong river, which is one of the most polluted in the country. Thus, the Ulsan metropolitan government has a plan to move the water-collecting area to supply cleaner residential water. This study attempts to measure the benefits of residential water quality improvement in Ulsan using contingent valuation method. Furthermore, we allowed for a nonzero probability of unwillingness to pay in contingent valuation experiments by using spike models, because 55.6 percent of respondents stated ‘no’ to the given bids to improve their residential water quality although other respondents stated that they would be willing to pay a significant amount.     

Is the human right to water sufficiently protected in Spain? Affordability and governance concerns

Most research on water poverty focuses on developing countries. However, research is also needed in developed countries, where water may be too expensive for some households. This paper examines the case of Spain, using data from 16 cities that combined are home to 35% of the Spanish population. We study both national and local systems of regulation and governance. The objective is to determine whether low-income families face a genuine threat of exclusion from water supply. To this end, we analysed whether the Spanish legal framework allows that water supply is cut off for non-payment of the bill. We also did different estimates of the percentage of the family income spent on the water bill, which in some cases can surpass 10%. The estimates account for tariff discounts, as well as assistance programmes available to those who are struggling to pay their water bill. Although there is no problem of affordability for an average Spanish family in general, we conclude that families at risk of poverty face a real threat of exclusion from water services because they are not able to pay for them and the institutional framework does not sufficiently protect them.     

Effects of institutional arrangements in local water supply services in Korea

In Korea, local governments are primarily responsible for providing water supply services to citizens. Since 2004, 15 local governments have contracted this service to the Korean Water Resources Corporation (K‐Water). This paper examines the effects of the two different institutional arrangements – direct public delivery versus contracting out to K‐Water – on cost savings and productivity. To do so, it employs a hybrid cost function approach and uses the panel data covering the nine years from 2000 to 2008 in local governments. Empirical findings show mixed evidence on the effects of the two institutional arrangements on cost savings and productivity gains. Water supply costs are significantly lower under contracting out than under direct public delivery. However, there are no significant differences in productivity gains between the two institutional arrangements. Local water supply systems need to further reduce the average water supply costs through increasing their size and magnitude.     

Infrastructure epistemologies: water,wastewater and displaced persons in Germany

Recent years have seen historically unprecedented global disaster migration; in 2016 Germany received 1.3 million displaced individuals. Regardless of past resources and future potential, disaster migrants are a new, vulnerable population. This new population increases demand for water and wastewater infrastructure services, despite being temporarily unable to pay for services. As such, this kind of sudden population increase is a resiliency challenge for the receiving infrastructure systems. Qualitative analysis of 1,884 open-ended survey responses was blended with a statistical analysis to discover how and why the German public perceives water and sanitation services have been provided to the disaster migrants. Unprompted, 36% (112/314) of respondents referenced at least one of three infrastructure epistemologies, including water and wastewater as a service, as a basic need, and as a human right. These epistemologies share statistically significant relationships with how long respondents feel water and wastewater should be provided to displaced persons. A temporally limited, normative perception of water and sanitation as a humanitarian good functions to enable water and wastewater infrastructure to deliver a high level of service despite the significant disruption of the large and vulnerable population influx, and has practical implications for the structure of cost recovery.     

Willingness to pay for reliable supplies of safe drinking water in Guatemala: A referendum contingent valuation study

Unreliability of water systems has become a major concern in many developing countries. A referendum-format contingent valuation (CV) survey was implemented to investigate household preferences, in monetary terms, for improved water services in the small town of San Lorenzo, Guatemala. A random sample of 500 households report that they currently adopt a variety of averting measures (e.g. in-home water storage and treatment) to cope with service interruptions and low water quality. Findings also indicate that households are willing to pay an increase of more than 200% in their water bill for reliable supplies of safe drinking water.     

Attitudinal and socio-demographic effects on willingness to pay for water services and actual payment behaviour

Improving revenue collection rates and minimising the levels of ‘bad debts’ is currently a top priority for managers of water utilities in low-income countries. This study used empirical data from a cross-sectional survey of 505 utility customers in eight urban centres in Uganda to show that customer attitude towards prompt payment, perceived ease or difficulty of paying on time (perceived control), as well as social pressure, strongly influence intentions to pay, which in turn directly affects actual prompt bill payment behaviour. The findings also show that gender, income, occupation of the household head and tenure status have statistically significant direct relationships with intentions, but their effects are much smaller compared to the joint influence of attitudes, perceived control and perceived social pressure. Moreover, the effects of gender and occupation are completely mediated by perceived control and social pressure respectively. These results have implications for improving revenue collection through customer-focused initiatives.     

Water safety plans for piped urban supplies in developing countries: a case study from Kampala,Uganda

Full cost recovery is a major and complex issue that has gained high recognition in recent years. The Water Framework Directive promotes the idea that water charging should act as an incentive for the sustainable use of water resources. Thus, all Member States should take into consideration the principle of recovery of the total cost of water services, which includes environmental and resource costs as well. In order to evaluate various aspects of current water policy, to investigate the perspectives of water saving, to explore new approaches toward sustainable water management in the water supply sector and to evaluate water price elasticity, a survey has been performed recently in the city of Volos, concerning the residential sector. The influence of some selected variables is examined, residential water demand curve and water price elasticity are calculated. Estimations of future water demand under different pricing policies are also performed. Finally, the full water cost for the city of Volos is estimated and essential conclusions concerning water pricing and public participation are drawn.     

Multi-attribute evaluation of flood management in Japan: a choice experiment approach

This paper intends to clarify the relationship among the important attributes of flood prevention measures and the effects of socio‐economic factors on the public preferences of selecting the measures based on the choice experiment approach. The experiment was conducted via a mail survey in the Toki–Shonai River basin of central Japan. First, the relationships among the five attributes (external flood reduction, internal flood reduction, early warning systems, environmental protection and willingness to pay for such countermeasures) were quantitatively clarified, and it was shown that an early warning system in terms of fatality rate due to floods was lowly evaluated by the public. Second, certain socio‐economic factors, like annual household income, flood experience, sex and distance to a river, had statistically significant impacts on the utility functions in our model. Third and finally, there was a statistically significant difference in regional model results between Toki city and Kita ward of Nagoya city. These results imply the necessity to implement localized watershed management in Japanese urban catchments, and to improve information provision and public understanding of flood risk.