Willingness to Pay and Inclusive Tariff Designs for Improved Water Supply Services in Khulna, Bangladesh

Publication | January 2012

The Khulna Water Supply Project aims at improving the access to safe water through the piped network in Khulna City, the third largest city in Bangladesh with a population of approximately 1 million.

The study investigates willingness to pay (WTP) for improved water supply services in Khulna, Bangladesh applying the contingent valuation method in a survey of 3,000 households. Mean WTP is large enough to justify the Khulna Water Supply Project. The median WTP is 3.6% of expenditure of the poorest households and connection charge is an important determinant of inclusiveness. Policy simulations show that poor households are less likely to be connected under a flat rate tariff, and that volumetric tariff is pro-poor. Installment payment of connection charges or inclusion of connection costs in capital investments will significantly improve the inclusiveness of the proposed project.


  • Abstract
  • Introduction
  • Literature Review
  • Survey and Estimation Models
  • Estimation Results
  • Policy Simulations
  • Conclusion
  • References