Ethiopia, Water Pricing for Sustainable and Inclusive Growth

Programme Objective:

The overall goal of the project is a realized transition towards an equitable access to scarce water resources and increased water-use efficiency in the Awash Basin, through improved water resources management and water regulation.

The specific objective is to facilitate the introduction of a permit and tariffing system. Support is given on translating water abstraction and availability data into an overall allotment of water access through permits, and setting up a system for issuing water use permits, including pricing, motivated allotment, water use requirements.

Six organisations are involved in a public private partnership: the Dutch non-governmental organisation Woord en Daad, VNG International, Dutch Water Authorities, Awash Basin Development Office, Oromia Regional Water, Mining and Energy Bureau, and the Dutch private company Eijkelkamp Projects, dealing with equipment to measure discharge, water levels and water quality.

Improved regulation and ultimately an effective tariffing system and paying end-users, can only be established with accurate water system data generated by appropriate instrumentation resulting in appropriate management information (hardware/software).

This public private partnership works towards a solution for the national challenge on the roles of federal and regional water governments establishing mandates for licensing, measuring and charging in the sub system. Together with Dutch Water Authorities, VNG International supports the Awash Basin Development Office on organizational and capacity-development level, and facilitates the introduction of a permit and tariffing system. Support is given on translating water abstraction and availability data into an overall allotment of water access through permits, and setting up a system for issuing water use permits, including pricing, motivated allotment, water use requirements.

VNG International’s methodology is rolled out to levying and collection of the charges. The backbone in the approach is to establish a constructive dialogue between an accountable government body that understands its main task of delivering good services and being customer-oriented, and engaged citizens.

The methodology follows a 5-step process:

1. Develop a strategy for implementation;
2. Develop awareness creation (plans) and social skills for River Basin staff;
3. Establish organisational processes for registration, permitting, charging, collection and enforcement;
4. Introduce and train on an easy to use, easy to implement, permit free billing and collection software to facilitate effective revenue management and decrease the risks of leakages and fraud;
5. Follow-up with project management training to sustain the services and early results.

The expected results of the project are:

• 90% of the water abstractors registered by AwBAO/OWERDB
• 265 big users and IWUAs are licensed
• AwBDO will bill/charge 90% of registered abstraction
• A charge levying and billing IT system is functioning
• 50 staff of AwBAO/OWERDB directorate for water administration trained on charging fees to water users
• Water allocation plan (and priority rules) implemented, benefitting 85 smallholder IWUAs (1,700 smallholders, 40% women) of which 50 new and 35 existing IWUA
• AwBAO/VNGI have reached at least 18,000 people to increase awareness on water charging and the need for paying to achieve inclusive access to water and efficiency water use.

Activities performed:

• Developed process architecture for registrations, licensing and billing
• Developed registration database and licensing + billing systems
• Developed a registration app for hand held devices
• Developed a community outreach strategy
• Developed training materials for a ToT on registrations.