Investment in Water Infrastructure - Lessons From Economic Analysis of Projects

26/11/2004

Investment in Water Infrastructure - Lessons From Economic Analysis of Projects

Embargoed until 00:01 hours, Friday 26 November 2004



This paper, by John Lawlor and Colm McCarthy of DKM Economic Consultants, will be presented at the ESRI workshop entitled "Trickle or treat - Water quality, investment and pricing", on on Friday, 26 November, 2004, from 0900-1300, at the ESRI Offices, 4 Burlington Road, Dublin 4.



In late 2003/early 2004, a team comprising DKM, the ESRI and Aquavarra Research carried out an Ex Post Economic Evaluation of Cohesion-Funded Water Supply & Waste Water Projects, on behalf of the Department of the Environment, Heritage & Local Government. The study assessed the costs and benefits, including environmental benefits, of recent public investments in water infrastructure. Over 50 projects in 14 major schemes were analysed. Investments mainly fell into the categories of water supply, water conservation and wastewater treatment, and varied by size, cost, location and type of receiving waters. Investment was driven not only by environmental or economic priorities, but also by compliance with various domestic and EU legislation. This paper summarises the findings of the study, highlighting wide variation in rates of return between projects, and the challenges of identifying and valuing benefits, where (1) the output of the water industry is free to most users, and (2) data on environmental impacts is limited. It goes on to ask what lessons can be learned for future investment programmes.