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Does MUS pay back?

Does MUS pay back?. Developing a framework for the analysis of costs and benefits of multiple use of water. Based on paper by Adank, M; Fonseca, C and Butterworth, J. Delft, 12 th February 2007. Introduction. = single use = multiple use = incremental.

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Does MUS pay back?

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  1. Does MUS pay back? Developing a framework for the analysis of costs and benefits of multiple use of water Based on paper by Adank, M; Fonseca, C and Butterworth, J. Delft, 12th February 2007

  2. Introduction = single use = multiple use =incremental • Little known on • costs and benefits of multiple use of water versus single use • Incremental costs -> incremental amount of water -> incremental benefits => Framework for analyzing costs and benefits => Use framework to analyze (incremental) costs and benefits from multiple use of water

  3. Categorizing costs 5 types of costs: • Capital investment costs in assets (CapIn) • Operating and minor maintenance expenditure (Opex) • Capital maintenance expenditure (Capex) • Costs of capital (CoCap) • Indirect support costs

  4. 3 Levels • Household level • System level • Service level

  5. Costs at different levels

  6. Costs depend on: • Context (costs of materials, labor, skills, etc) • Use of water • Amount used, and how it relates to amount designed for • Type of system • Type of infrastructure • Type of management

  7. Use of water Different uses could be grouped in the following categories: • domestic use • de facto domestic+ (unintentional additional uses) • domestic+ (additional uses according to design) • multiple use (domestic and productive use to full potential) • Irrigation+ (additional uses according to design) • de facto irrigation+ (unintentional additional uses) • irrigation. Incremental costs: additional costs of going from one type of use to another type of use

  8. Type of systems / technological option A possible categorization: • rain water harvesting system • manually operated point source • mechanized point source • community managed piped system • utility managed piped system • open canal system (open to suggestions)

  9. Use of water and type of system Incremental costs Incremental costs

  10. However • Shape of graphs depends on context • Shape of graphs depends to large extent on type of system • In reality, “type of use” and “type of system” are not independent from each other • Possible to look at incremental costs of different uses • within a specific system • similar type systems within same context (e.g. ranges of upgrades of a system, leading to increased availability of water and change in the use of the water)

  11. Comparing between households • Difference in context make it impossible to compare between cases • No incremental CapIn • Incremental Opex determined by tariff structure

  12. Comparing between systems • Only possible when context is constant • Incremental costs is combination of incremental CapIn and Opex

  13. Availability of data Scattered information, often difficult to compare, complete data sets are rare • Either info on household level or on system level • Either info on CapIn or Opex Hardly / no data on: • Capital maintenance costs and costs of capital • CapIn and Opex costs in kind (materials contributed by users, labour, land etc) • Support costs => Underestimation of costs

  14. Benefits Benefits of water use will depend on • Context factors (e.g. access to markets, other production resources etc) • The use of the water • Type of activity (quality and quantity water needed)

  15. Benefits related to quantity of water available

  16. Data available: Optimal benefits per m3 of extra water Context is important factor 1. Adapted from Hutton, G. and Haller, L. (2004). 2. Juan Carlos Pérez de Mendiguren and Mpatametse Mabelane (2001) 3. A. J. James (2004)

  17. Benefits are easily overestimated • Often not optimal use of extra water => actual benefits will be below potential benefits. How do people use extra available water? • Often no linear relationship between amount of water used and benefits • Important to look at case specific actual benefits. (but data on this is generally lacking)

  18. Costs and benefits of different uses within a system

  19. Costs and benefits between systems

  20. Conclusions • Is it possible and useful to determine incremental costs and benefits of multiple use versus single use? • Difficult to determine incremental costs of types of use. Easier to determine incremental costs of types of systems • Incremental costs are very context specific => generalization is difficult • Many systems are over designed => incremental costs of increased use of water negligible • How to determine incremental support costs? • Does MUS pay back? • At first sight, yes. However, costs are easily underestimated and benefits overestimated. Need for more research in actual costs and benefits.

  21. Thank you • Questions?

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