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Analysis Of Water Tariff Structure In Santa Cruz Island (galapagos Archipelago)

World Water Congress 2015 Edinburgh Scotland
7. Valuing water : monetary and non-monetary dimensions
Author(s): Maria Reyes

Maria Reyes, MSc.  UNESCO,  m.reyesperez@unesco-ihe.org



M.Reyes1, N. Trifunović1, S. Sharma1, M. Kennedy1,2
1 UNESCO--IHE Institute for Water Education, Department of Environmental Engineering and Water Technology, P.O. Box 3015, 2601 DA Delft, The Netherlands
2 Delft University of Technology, Faculty of Civil Engineering and Geosciences, P.O. Box 5048, 2600 GA Delft, The Netherlands
E-mails: m.reyesperez@unesco-ihe.org, n.trifunovic@unesco-ihe.org, s.sharma@unesco-ihe.org, m.kennedy@unesco-ihe.org.

1- Introduction

The island of Santa Cruz, located in the Galápagos Archipelago has experienced significant increase in tourism with consequent growth of local population over the past two decades (González, Montes et al. 2008). The rapid increase in number of hotels and restaurants raised pressure on water resources needed to satisfy the customers' needs.

The municipality of Santa Cruz has not been capable of coping with current expansion rates in order to provide good quality water services. Financial constraints, limited personnel and tariff structures are the main reasons that restrict the capacity of the Department of Potable Water and Sanitation (DPWS) to manage the water supply system. Therefore, the municipal water service has been perceived as low and unreliable. The water supplied is of non- drinking quality (Liu and d'Ozouville 2013), and local population need alternative supplies, such as bottled water being the main source of drinking water, and purchase of bulk water supplied by trucks.

Two main settlements on the island are Puerto Ayora and its suburb, Bellavista, with total population of approximately 14,500 (INEC 2010) and independent water supply systems. Puerto Ayora has a fixed-priced tariff per month and lacks individual water metering. On the other hand, Bellavista has a metered system, with fixed cost of USD 1.21/m3 (GADMSC 2012). Yet, approximately 32% of water meters are faulty (measured in January 2014). Consequently, due to difference in tariff structures, water demands vary significantly.

This paper assesses the difference of tariffs among the two settlements. Furthermore, the impacts on revenues due to faulty meters (Bellavista) and fixed tariffs (Puerto Ayora) are quantified. In addition, several scenarios have been developed and analyzed in order to examine the benefits. Finally, the information regarding overdue bills and willingness to pay by the different categories of users has been examined.
2- Research Methodology

The study was based on the information gathered during the fieldwork conducted from September 2013 to January 2014. Questionnaire-based interviews were carried out with local population and relevant authorities dealing with water management on the island. Moreover, specific data regarding tariffs, payments and information on water meters in Bellavista were provided by the municipality of Santa Cruz. Based on a survey of 374 premises, water demand was quantified for different categories in order to estimate the specific demand, the actual payments and willingness to pay.

In addition, an attempt was made to reconcile all the data from the survey with the information available at the municipality. Several scenarios were then drafted in order to draw conclusions on the most suitable strategy for the current situation of the DPWS.
3- Results and Discussion
3.1 Analysis on revenues

The revenues from water supply vary extensively between the two settlements. Table 1 shows the average demand per category as well as the total revenue from the water cadastre 2013 for Puerto Ayora, therefore based on average number of connections; the average cost was calculated assuming all customers pay on time.
Table 1-Estimations of cost per cubic meter of water per category for 2013 in Puerto Ayora

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