Cost reflective tariff system for domestic water supply in Sri Lanka

Abstract

The main purpose of this study is to identify critical factors affecting the design and implementation of a cost reflective tariff system for domestic water supply in Sri Lanka. This study was carried out through a situational analysis, survey and in-depth interviews with various stakeholders in the Sri Lankan water sector. A structured questionnaire survey identified the economic affordability of randomly selected customers in the Western Province of Sri Lanka. The situational analysis shows that the national water supply entity, National Water and Drainage Board, in Sri Lanka is unable to recover the cost of supplying domestic water, owing to the non-existence of a cost reflective domestic tariff system. Survey responses show that the existing tariff structure has failed to generate sufficient rate of return by achieving equity. The methodology employed and the policies derived can be used as guides to similar types of research in other countries as well.