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Economics of Sanitation for Informed Decision Making
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Economics of Sanitation for Informed Decision Making

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WASH 2011 conference: Almud Weitz, Water and Sanitation Program …

WASH 2011 conference: Almud Weitz, Water and Sanitation Program

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  • 1. Economics of Sanitation for Informed Decision Making Almud Weitz WATER AND SANITATION PROGRAM Brisbane, May 2011
  • 2. Study RationaleOverall Goal: To advocate for increased investments, efficientplanning and implementation of sustainable sanitation and hygieneoptions. Components: 1. Impact Study: Analyze economic impacts of current sanitation arrangements & hygiene practices; and estimate potential gains from improvements based on analysis of secondary data 2. Options Study: Analyze costs and benefits of different sanitation options to inform policies and programs based on primary surveys
  • 3. Impact Study Results – Southeast Asia Health Water Environment User preferences Tourism 8 7 US$ 9 billion 6 Per capita US$ 22 5 4 3 2 1 0 Cambodia Lao PDR Indonesia Philippines Vietnam
  • 4. Impact Study Results – India Share across impact categories 80% Health 71.7% 70% US$ 53.8 billion 60% Per capita US$ 48Percent of Total 50% 40% 30% Access Time 20% 20% Water 10% 7.8% Tourism 0.5% 0%
  • 5. Emerging Options Study Results Preliminary results from: Cambodia, Indonesia, Philippines, Vietnam and Yunnan Province (China)
  • 6. Study FeaturesField-level cost benefit analysis,comparing technologies and programapproachesClose to 40 field sites: 20 rural, 18urban, with sample of over 5,000householdsMonetized benefits focusing onhealth, water and access timeComparing optimal versus actualprogramIntangible benefits assessed
  • 7. Sanitation Options Have a Positive Return 10 9 Benefit-Cost Ratio 8 Rural Sites 7 6 5 4 3 2 1 - 10 9 8 7Benefit-Cost Ratio 6 5 Urban Sites 4 3 2 1 -
  • 8. Some Technologies Perform Better than Others… Cambodia - rural Access time 4 Water treatment Water access 8 Health mortality 3 Health productivity 8Benefit-Cost Ratio Health care 3 2 1 1 0 Dry pit (CLTS) Dry pit (long-lasting) Wet pit 1 Wet pit 2 Life span Wet pit outperforms dry pit
  • 9. …but Relative Performance Varies Among Countries Indonesia - rural 8 7 6Benefit-Cost Ratio 5 Access time 4 Water treatment 3 Water access 2 Health mortality Health productivity 1 Health care 0 Public Shared Dry pit Wet pit Septic / WWM Dry pit outperforms wet pit
  • 10. Higher Ladder Options – Higher Benefits… Yunnan (China) - rural 300 250Annual economic benefit 200 per household 150 Reuse Access time 100 Water access Health mortality 50 Health productivity Health care 0 Pit latrine UDDT Septic tank
  • 11. …but at What Cost? US$ (2009) Annualized Cost - Rural Sites 70 60 50 40 30Yunnan - 20rural 10 0 Shared Pit UDDT Biogas Septic tank Program Maintenance Operation Investment US$ (2009) Annualized Cost - Rural Sites 140 120 100Philippines - 80rural 60 40 20 0 Dry pit EcoSan Septic tank Septic tank with STF Investment Operation Maintenance
  • 12. Impact on Resources/Environment UndervaluedWith and without wastewater management 6 5 4 3 2 1 Access time Water treatment 0 Water access Wet pit Septic Septic Septic Septic Septic Wet pit Septic Health mortality WWM WWM WWM WWM Health productivity Health care Indonesia Philippines Vietnam China (Yunnan) If environmental benefits are not monetized, the cost- benefit performance of WWM is lower than other options
  • 13. Use What is There More EfficientlyPercentage loss in efficiency under actualprogram conditions45%40%35%30%25%20%15%10%5%0%
  • 14. To i le tp os 0.5 1.5 2.5 3.5 0 1 2 3 4 Cl it ea ion nl in es s St at Vi us M sit ai or nt s aiCo Co ni n v n fl ng en ict He Co ien a vo alth n v c e id a en for nc ie nc c h i e l Ni e fo dre gh r n t u e ld s e er of ly t Av oile oi t Da d ng Sh rain e r ow Don’t Forget Non-Quantified Benefits! ou e s a r in ni g m al s Yunnan: Average satisfaction with current toilet option Improved Unimproved
  • 15. Key Messages• Sanitation is a socially profitable investment• Economic performance varies substantially between technology options• You can’t copy and paste – significant inter-country differences of costs and benefits• Choices must be made on level of benefits required - higher benefits usually cost more• Use what is there better - optimal versus actual economic performance• Non-quantified and environmental benefits of sanitation require better understanding as they are crucial to consider in decision making
  • 16. AcknowledgementsWith special thanks to funding agencies, staff of WSP andconsultant teams and their institutes:- Study lead: Guy Hutton, WSP- Cambodia: Sok Heng Sam, EIC- Indonesia: Asep Winara, MLD- Philippines: U-Primo Rodriguez, UP- Vietnam: Viet Anh Nguyen, IESE- Yunnan: Liang Chuan, YASS

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