Research Brief

Sustainable Water Service Tariff Model

📅 Jun 26, 2024 📄 P027 | Water (MDPI) ⏱️ 5 min read
Research Brief P027 Water (MDPI)
AB
AquaBridge Research Team
Jun 26, 2024 · 5 min read

Executive Summary

Key Finding: Ecuador case study shows tariffs need >100% increase to cover watershed management costs. Value of watershed environmental services = $1.5M annually ($2.60/household/month).

Policy Takeaway: Integrate watershed economics into tariff design. Users should pay for both water supply AND watershed protection.

Integrated Watershed Management (IWM) Costs

Ecuador Case Study:

  • Current tariff: $0.03/m³ (too low for sustainability)
  • Required: $0.06/m³ (100% increase)
  • Watershed service value: $2.60/household/month
  • Annual watershed value: $1,505,530

Tariff Model Components

Component Description Formula
Supply Costs OPEX + CAPEX Operating + Capital recovery
Water Loss Reduction Infrastructure investment NRW reduction costs
Watershed Management IWM expenses Environmental services

Application in AquaBridge Toolkit

Our Tariff Designer uses this research:

  • Watershed Cost Calculation: (Area × 0.5) + (Pop × 0.01) + Region Base
  • 11 Global Regions: Each with 3-4 major watersheds
  • Open Access Data: FAO AQUASTAT, UNEP, River Basin Commissions
Try Tariff Designer →
Reference: Vásquez, J.P., Ponce, D., & Arteaga, J. (2024). Sustainable Water Service Tariff Model for Integrated Watershed Management. Water, 16(13):1816. Read Full Paper →

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← Previous: Affordability Framework Next: Tariff Structure Design →
Reference: Vásquez, J.P., Ponce, D., & Arteaga, J. (2024). Sustainable Water Service Tariff Model for Integrated Watershed Management. Water, 16(13):1816. Read Paper →
← Previous: Affordability Framework Next: Tariff Structure Design →