New service benchmarks to improve waterservices for all
STOCKHOLM, September 7, 2010 - Despite global food, fuel, and economic crises, water utilities in developing countries are becoming more self reliant and sustainable, according to a new report today released by the World Bank and the World Bank-administered Water and Sanitation Program (WSP).
The International Benchmarking Network for Water and Sanitation Utilities (IBNET) Blue Book is the first published benchmarking of data from 3,000 utilities in more than 100 countries that helps water utilities and governments improve services for all, including the poor.
"Up until the impacts of the fuel crisis were felt, the ability of utilities to cover at least their basic operation and maintenance costs was improving," said World Bank Lead Water and Sanitation Specialist and coauthor Caroline van den Berg. "Indicators of staff productivity and revenue collection periods also showed improvements. Service tariffs are also on the rise, indicating an improved ability to recover costs."
The report also showed that utilities demonstrating openness and transparency by participating in the voluntary data collection by IBNET made significant progress towards sustainability over time.
"The Blue Book summarizes more than a decade effort of the World Bank and WSP to set and encourage the use of performance assessment standards for water utilities in developing countries," said WSP Senior Water and Sanitation Specialist and coauthor Alexander Danilenko.
The report found that only a few utilities worldwide are, or were able to extend their coverage without public investments. "Although utilities are becoming more sustainable, their ability to extend new water and sewerage coverage tends to be dictated m ore by availability of public funding than internal cash generation in utilities," Danilenko continued.
The IBNET Blue Book also shows that there is a direct relationship between the level of cross-subsidies and the proportion of non-residential water consumption in total water consumption. The higher the levels of cross-subsidies, the higher the proportion of residential, and the lower the proportion of non-residential water consumption in total water consumption. Yet, high levels of non-residential water consumption do not automatically translate into more revenues per cubic meter sold, and hence there seems to be an optimal level of cross-subsidies where a relatively modest level of cross-subsidies (between 1 and 2) optimizes the average revenues per cubic meter of water sold.
Yet, these subsidies are not an easy solution to improve affordability. As it was shown in a recent report by Kristin Komives, Vivien Foster, and Jonathan Halpern (Water, Electricity and the Poor: Who Benefits from Utility Subsidies? World Bank, Washington D.C., 2005) subsidies tend to be regressive. The trend is different between countries. Interestingly, in almost all regions for which data are available, users that depend on smaller quantities of water pay significantly more per cubic meter than larger quantity consumers do. This is partly the result of tariff structures that tend to have high fixed costs, which disproportionally affect those consumers of small quantities of water. Another striking feature is the high tariffs being paid in Africa, especially as service levels tend to be relatively low there.
Suitcases full of compliments
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So, day 2 of the 3-day conference is over. We're sitting outside and talk about how everyone experienced today. Just for explanation: World Waternet i...
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