Aggregation of Water and Sanitation Provision : Finding the Optimal Scale for Operations
When several municipalities unite in a single administrative structure - a process known as aggregation - they can lower the cost of utility services through economies of scale. Aggregation of water supply and sanitation (WSS) services is establish...
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| Format: | Brief |
| Language: | English |
| Published: |
Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2008/06/9676750/aggregation-water-sanitation-provision-finding-optimal-scale-operations http://hdl.handle.net/10986/11750 |
| Summary: | When several municipalities unite in a
single administrative structure - a process known as
aggregation - they can lower the cost of utility services
through economies of scale. Aggregation of water supply and
sanitation (WSS) services is established practice in some
countries and is likely to spread, as decentralization
policies leave some service providers too small to be
efficient or sustainable. Aggregation offers returns such as
shared overhead and lower unit costs through bulk purchasing
and pooled operations, plus other benefits that lower costs
to customers or improved service at the current cost. Other
benefits include greater access to financing, better
distribution of skills, more opportunities for
cross-subsidization and efficiency, access to new water
resources, and new solutions to pollution problems. In 2005,
the author studied 21 instances of aggregation of WSS
services aggregations, looking for innovative models and
factors that contributed to success. The practices author
identified may help other countries aggregate municipal utilities. |
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