National Policy Dialogue on Financing Strategy for Urban and Rural Water Supply and Sanitation in the Kyrgyz Republic

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The report National Policy Dialogue on Financing Strategy for Urban and Rural Water Supply and Sanitation in the Kyrgyz Republic was prepared for the Second Coordination Council Meeting for the National Policy Dialogue on Financing Strategy for Urban and Rural Water Supply and Sanitation in the Kyrgyz Republic. The Baseline scenario of the financing strategy was developed to discuss future development options for water supply and sanitation in Kyrgyzstan and the financing thereof.

Contents

Introduction

The overall objective of this project is to strengthen the capacity of the Government of the Kyrgyz Republic (GoK) to plan and implement prioritised water supply and sanitation (WSS) infrastructure investments, to mobilise and effectively allocate financial resources for reaching water-related Millennium Development Goals (MDGs), while ensuring that WSS infrastructure development objectives are affordable for the population and the public budget. A start-up meeting was held in Bishkek on 8th April 2008 where the Finance strategy methodology and the FEASIBLE tool were presented to national and international stakeholders. The composition and Chairmanship of the Coordination Council was also agreed. Stage 1 of the project has now been completed. Data has been collected on the current urban and rural WSS infrastructure, institutions, relevant legislation and GoK policy and strategy for WSS sector, as well as the macro-economic situation and its influence on WSS provision. This information has been fed into the FEASIBLE model. This information has been collected from a wide variety of sources including reports on previous surveys and national statistics, and interviews with GoK representatives, staff from current WSS projects, vodokanals and representatives of the international development organisations. The team of consultants is grateful to the following organisations for their inputs to this stage:

  • National Statistical Committee
  • Ministry of Finance – Treasury Department
  • Ministry of Health - Department for State Sanitary Epidemiological Surveillance
  • National Agency of Local Government Affairs
  • Urban Institute
  • ARIS
  • Vodokanals staff in Bishkek, Osh, At Bashi, Balykchy, Bokonbaev, Cholpon-Ata, Jalalabad, Kant, Kara Suu, Karakol, Kochkor Ata, Kok-Jongak, Kyzl Suu, Kyzyl-Kia, Mailu-Suu, Naryn, Teplokluchenka (Ak Suu), Tokmok, Uzgen
  • Representatives of EBRD, SDC, JICA, ADB, World Bank, DFID
  • The PMU for the ADB, and PMU and PMC for the World Bank, Rural Water Supply Projects

During this stage, a Baseline (“no new policy”, or “business as usual”) Scenario has been developed to assess the financial gap between expenditure and supply of finance and a package of realistic policy measures to bridge the gap has been created and modelled. The summary situation analysis and baseline modelling summarised here are based on a more comprehensive Baseline Report which is presented in association with this report. This Baseline Report is a work-in-progress draft and more information is being gathered all of the time. The next Stage will consider the social dimension of the Finance Strategy and identify alternative options for development targets. A list of possible policy targets and options are presented here for consideration by the Coordination Council to inform this Stage. Stage 3 will then seek to design a realistic financing strategy for WSS with prioritised investments and realistic measures to bridging the financing gaps. This paper sets out the current context and main challenges facing the WSS in the Kyrgyz Republic and proposes policy measures to deal with the challenges. It presents the Baseline Scenarios as modelled using FEASIBLE (setting out the assumptions made and showing the results). Finally, it lists a set of policy options for defining and achieving development targets for the WSS sector.

Current Situation

Summary Description of the Kyrgyz Republic

The Kyrgyz Republic is a low-income country (2006 GDP per capita amounted to 436 USD), located in Central Asia. It has a population of around five million with population density ranging from six people per km2 in Naryn to 45 people per km2 in Osh. The proportion of people living in poverty ranges from almost 60% in Batken to 22% in Chui (and 11% in Bishkek. The rural population makes up about 65% of the total population of the Kyrgyz Republic, about 3.28 million people living in 1,829 villages in 471 Ayil Okmotu. Of the 1,800 villages, almost one-third are below 750 people in size, and 98% are below 10,000 people. According to the Kyrgyz Republic’s institutional and political definitions, there are 25 urban settlements in the country. The main urban settlements in the Kyrgyz Republic are Bishkek (750,300), Osh (208,500), Jalal Abad (70,400), Karakol (64,300), Tokmok (59,500), Karabalta (47,100), Uzgen (41,500), Balykchy (41,300) and Naryn (40,000). In these settlements, water supply and sanitation is managed by vodokanals (water utilities). Kyrgyzstan has plentiful water resources, equal to 2,458km³, of which 50km³ are surface river waters, 13km³ are potential ground water resources, 1745km³ are as lakes and 650km³ are bounded in glaciers. However, climate warming is leading to a continuous process of reduction in the volumes of the glaciers in Kyrgyzstan. Historically, about 85% of water supply schemes constructed use groundwater sources. However, due to the high operating costs associated with groundwater (energy costs for pumping in particular), the number of water supplies taking water from less secure open sources is increasing. Pollution of water sources is an increasing problem especially in rural areas due to unprotected streams and wells. A variety of published sources differ widely in their assessment of what proportion of the population has access to safe drinking water and adequate sanitation. Estimates range from 90-98% for water and 75% for sanitation in urban areas and 19-81% for water and 51% for sanitation in rural areas. On average for the country, about 11% of tests for microbiological parameters did not meet the hygienic norms in 2007. In Osh city the failure rate is as high as 31%. Osh water supply takes water from the Akbuura River because groundwater in this part of the country has a high level of mineralization. For chemical parameters the failure rate against sanitary norms is just over 2%. In the Fergana valley the main problem related to the chemical composition of water is that some groundwater sources are depleted and highly mineralized. In the Chui Valley any water chemistry problems are mainly related to the pollution of ground water sources with waste and industrial sewerage. The heavy use of fertilizers and pesticides for agricultural purposes in the past, especially in southern Kyrgyzstan has resulted in pollution of many sources with residual pesticides. Based on recent assessments, 206 water supply systems (19.1%) do not comply with sanitary norms, 77 of them do not have sanitary protection zones, 24 have no water treatment plants and 59 no disinfection systems (SES, 2008). Children’s mortality from acute enteric infections remains high. Typhoid morbidity is still a serious issue and is the most frequently registered of waterborne diseases. In 2007, the morbidity rate for enteric typhoid and paratyphoid increased by 40% and resulted in 186 cases of typhoid and 90 of paratyphoid, with Jalalabad oblast being hardest hit with 70% of cases. The main reason for increases in the disease rate was the insufficient provision of good drinking water quality.

Summary of main problems and challenges faced by the WSS sector and possible policy measures for improvement

The main problems and challenges facing the WSS sector in the Kyrgyz Republic can be categorized as technical, socio-economic, environmental and geographic, financial and institutional (and policy), though in many cases the challenges cut across categories. Some challenges are not policy related and are a fact of life which must be lived when planning and managing WSS services, but the situation could be significant improved by policy changes in relation to many of the challenges. Possible policy measures are proposed below:

Challenges Policy Measures
Technical Measures
Poor condition of existing infrastructure Prioritise locations and infrastructure components for improvements. Develop clear policy on best practice for operation, maintenance (and deferral of maintenance) and reinvestment/rehabilitation.
Bad quality of level of service (e.g reliability, predictability and water quality) Define best practice for operation to maximise performance. Consider benchmarking in defining best practice. Consider opportunities for incentives to staff and utilities in relation to improved performance.
Lack of water metering to assess production and use Metering-based study on water production/non-revenue water (UfW)

Introduction of bulk metering in settlements with populations of more than 10,000 people.

Socio-Economic Measures
Low level of HH income with big regional disparity meaning potential for affordability problems Consider targeted subsidies for 'unluckiest' areas (which suffer from a combination of low affordability/low household incomes and high unit costs/per m3 or per person served)
Great population density variation -
Public health hazards Greater emphasis on treatment. In disease 'hot spots', identify sources and solutions (engineering, awareness-raising, treatment)
Unwillingness to pay for (dissatisfaction with) poor level of service Identify causes of dissatisfaction and develop specific plans for improvement and promote them through a public awareness campaign. Regulation to define standards in terms of reliability, predictability and WQ.
Environmental & Geographic Measures
Many water resources but often poor quality surface water Promote groundwater and treatment
Harsh climate and seismic activity risks sustainability of infrastructure Promote appropriate technologies or saving/investment for heavy maintenance (reinvestment)
Rocky ground, topography and remote locations lead to high construction costs Promote R&D in, and introduction of, appropriate technologies
Financial Measures
Poor cost recovery due to low tariffs and low collection rates Greater cost recovery to be achieved through improvements in service and awareness raising.
Poor government funding for WSS Assign higher priority to WSS in the national economic policy and budgetary process (MTEF). Improve quality and monitor Aiyl Okmotu budget requests for WSS from Min of Finance
Major cross-subsidisation of residential customers by industry and commercial enterprises Review contribution of each category and focus on main cross-subsidising vodokanals. Focus getting residential tariff increases towards maximum affordable levels to reduce existing cross subsidy.
Unpredictable ODA and external lending Continue to improve donor/GoK coordination on priorities (e.g. through Joint Country Support Strategy (JCSS))
Effectiveness of external lending is extremely variable Lesson learning to be collated and publicised. Independent monitoring and assessment of results of projects and investments.
Fragile/uncertain macroeconomic outlook -
Institutions and Policy Measures
Lack of coordinating/ regulatory body for the WSS sector as a wholeResponsibility, location and powers for coordination, regulation and implementation to be defined and supported. Consider the role of the National Agency for Local Government Affairs in this regard. Develop National Water Supply Policy to provide clarification on roles and responsibilities. Consider location for coordination agency - President’s Office or Prime Minister's Office? Review decentralisation process for service delivery – consider some agglomeration for technical support functions. Look at opportunities for achieving economies of scale and clarity in functions for service delivery.
Lack of capacity at local level for service delivery and finances
Over-fragmentation and decentralisation of the water sector meaning a lack of economies of scale and too much diversity of costs
Lack of database and MIS for sound decision making Further develop and link current databases available from the variety of sources in rural and urban sectors (e.g. SES, PMU/PMC, ARIS, UI)
Over-reliance on Soviet consumption norms restricts target definition Modify targets for service delivery based on realistic demands of users for reliability, predictability and water quality
Lack of coordination between water sector policy and that of other sectors (e.g. Housing) Maybe under President's or Prime Minister's Office?

Baseline Scenario

Only the macroeconomic and financial assumptions of the scenario are listed here. The technical assumptions are listed in Annex A.

Macroeconomic and financial assumptions used in preparing the financial model

All simulations are made in base year prices (thus no projections for inflation). Thus all growth projected is in real terms. In 2007-8 the IMF has expressed concern about the growth of inflation due to imported price rises. There is likely to be a price “spike” for the next year or two, but it is quite impossible to forecast domestic inflation over the whole 20 year scenario period, since any sizeable inflation is ex hypothesi unsustainable. Virtually all long term macroeconomic forecasts assume that inflation is managed down, and accommodated by exchange rate flexibility. Relative price changes are different – see below. The assumption is made of no Kyrgyz som appreciation or depreciation against the EURO or other major currencies. The exchange rate has been fairly stable in recent years and, looking ahead, the upsides and downsides are evenly balanced. The current state of international currency markets prohibits any sensible prediction of the movements of a single currency, especially over a 20-year period. The most important relative prices for WSS are electricity for pumping and operation of treatment works. For the KR there are scenarios in which oil and hydropower prices could go either way over the next few years, while in a 20-year scenario there are grounds for thinking that the current high prices may reflect future values, without further adjustment. Energy prices used in the model are as of July 2008 at a high baseline. Real household income (HH) is assumed to grow at 3% p.a. Real GDP growth is assumed to be 5% pa. This is considered to be conservative. The outturn in 2007 has been revised to 8.2% in 2007, and slightly higher if gold is excluded, following 3.1% in 2006 and an actual decline in 2005. The IMF and Government are taking 7% growth as their projection for the net 2-3 years. The Kyrgyz Republic is small and could potentially be resource-richer in the future, and positive real growth of at least 5% p.a. could be possible in the longer term. Three baseline scenarios are presented in the next section. All of them assume that expenditure on the baseline level of service remains unchanged (though there maybe improvements in the management of WSS systems to improve performance).

  • The first assumes no policy changes at all so no increase in tariff rate or collection rate.
  • The second assumes that the payments from households for WSS will gradually increase to the maximum level of affordability(assumed at 2.5% of household income on average – with maximum of 5% for any of the 10 income groups) during the planning period and that the maximum level of affordability will reflect HH income growth in line with GDP.
  • The third assumes the increase in tariff contributions shown in the second scenario but also assumes that tariff collection rates are assumed to grow to 85% in urban areas and 60% in rural areas after five years.

It is assumed that there will be no significant growth in the allocation of resources to WSS from public revenues given current policies and institutional responsibilities.

Results of baseline scenario simulations with FEASIBLE model

For the WSS sector as a whole

Image:Baseline_1_Kyrgyz_Republic.JPG

The figure above shows the results for all three baseline scenario simulations. Without any increases in tariff or collection rate, it is clear that not even the costs of operation and maintenance (O&M) will be met. If tariffs are increased to the maximum level of affordability over the planning period, then O&M costs could be met by 2012 and reinvestment costs (to replace worn out infrastructure components to maintain the condition of the infrastructure) could be met by 2022. Beyond 2022 the additional revenue would be available for extending and improving infrastructure. If tariffs are increased to the maximum level of affordability over the planning period, and tariff collection rates grow to 85% in urban areas and 60% in rural areas after five years, then O&M costs would be covered by 2012 and reinvestment costs would be covered by 2020, so beyond 2020 the user charge revenue would also generate some surplus for new investments.

Split between urban and rural

Image:Baseline 2 Kyrgyz Republic.JPG

This figure shows that both expenditure and supply of finance are dominated by the urban sector, with the urban sector accounting for more than 90% in both cases. However, much of this is to do with the fact the rural sector lags behind the urban sector in terms of access so there is no O&M and no tariffs to be paid. This will grow as investments in the rural sector continue.

Proposed package of policy options for development targets

The following are suggestions for the development of WSS over and above what is included in the Baseline Scenario. These are basically measures to extend “improved” services to those people currently without access to these, and to upgrade facilities and services in “hot spots” or to tackle specific problems. The list includes measures to improve the means of financing to make the scenarios affordable.

Choice of appropriate national targets for the WSS sector development/the level of WSS services, SMART and consistent with MDGs on WSS

  • Interpretation of the MDGs in the Kyrgyz context. Setting quality of service standards that are appropriate and realistic. This could even mean reducing the standards to be more in line with affordability.
  • A strategic decision is needed about the relative importance of water supply, compared with sanitation, which implies priorities for the implementation of the MDGs or other national targets. It is possible that improvements in drinking water quality (through, for instance, greater care and spending on treatment, or reducing local sources of contamination), might produce greater public health benefits, as well as increase willingness-to-pay, compared with sanitation programmes. Likewise, domestic hygiene programmes (and associated educational initiatives) could have major benefits for public health and encourage people to pay higher tariffs in return for improved service.
  • Target investment to specific pollution or public health “hot spots”, e.g. areas prone to typhoid
  • Optimise infrastructure and systems to deliver future target services more efficiently and at lower operating cost (e.g. re-sizing installations, replacing old inefficient pumps, reducing leakage, making pipes more weather-proof)
  • - e.g. every day from 6 a.m. to 9 a.m., from 11 a.m. to 13 p.m., and from 17.00 to 20.00


For example, an option for development targets consistent with MDGs on WSS, but somewhat more ambitious re service level, might look as follows:
1. Water supply:
In the settlement served by vodokanals:
24-hour water supply, no less than 150 lcd, delivered through:
a) in-house taps or yard taps – for 85% of households in 2020 (from 70% in 2006)
b) street posts/stand posts – to the rest of households (down from 30% in 2006)
In the settlements outside the vodokanals service areas:
As minimal, 8-hour water supply according to a firm schedule, convenient for most households*, no less than 50 lcd delivered through:
a) in-house taps or yard taps –for 25% of households in 2020 (from 70% in 2006)
b) street posts – for 55% of households in 2020 (from 30% in 2006)
c) from other safe sources (e.g. own bore-holes, shallow dug wells, springs) - the rest of households.
2. Sanitation:
In urban settlements:
a) 60% of households connected to the central (piped) sewer systems in 2020 (up from 20% in 2006)
b) 20% of households connected to septic tanks in 2020 (from 15% in 2006)
c) the rest has on plot improved sanitation facilities (e.g. pit latrines, or ventilated pit latrines)
All wastewater collected into central systems is treated:
a) effective mechanical-biological treatment and disinfection – in Bishkek and Osh;
b) effective mechanical treatment in other urban settlements
In rural settlements:
a) 10% of households connected to simple sewer systems in 2020 (up from 0% in 2006)
b) 20% of households connected to septic tanks in 2020 (from 0% in 2006)
c) the rest has improved on plot sanitation facilities (e.g. pit latrines, or ventilated pit latrines)

Disinfection of wastewater collected into sewer systems

Design and implement a package of policy measures which would promote achieving of the set targets

  • Study and pilot volumetric pricing. Selective extension of metering, starting from the bulk metering envisaged in the Baseline, through metering pilots in larger towns. Tariff issues to be resolved include tariff structure, marginal tariff rate, use of block structure, use of cheap or free initial blocks and cross-subsidy from industrial and commercial users.
  • Where electricity bills are being incurred (pumping for groundwater abstraction) it is recommended to pilot the collection of the electricity bills for the pumping costs as a surcharge on electricity bills in rural areas. This will increase collection rates at no additional cost and mean that community groups will not have to collect large amounts from the community to pay the pumping bills.
  • Creating a national system of financial solidarity, requiring the creation of a new budgetary fund (e.g. Water fund), funded from taxation with possible initial contributions from donors. Its purpose would be to compensate communities which, by reason of their small size, location or other geographical circumstances find it difficult to deliver the national service targets except at high cost, which would make them unaffordable. If the GoK was to reconsider its position in relation to the HIPC initiative, this could release funds to start such a solidarity fund.
  • Private property developers might be a source of finance for WSS incorporated in their housing with costs recovered through sales, rents and service charges.
  • The financial remittances from Kyrgyz workers in other countries might be harnessed for community projects through the development of microcredit schemes. Such a scheme would need to be well publicised in order to achieve community acceptance.

Key questions for the Coordination Council to address

At the second meeting of the Coordination Council (CC) on 21st October 2008, there will be plenty of time for discussion because the views of the CC are keenly sought. Three broad questions need to be answered by the CC to take the process further. These are:

  • Are the main problems//challenges and policy measures in Section 2.2 accurate and complete? Are there any other problems or challenges which should be included and what other policy measures could be proposed?
  • Are the macroeconomic and technical assumptions used in the financial modelling (and shown in Section 3.1 and Annex A) reasonable? If not, what changes to the assumptions should be made?
  • What shall be appropriate national targets for the WSS infrastructure development and the level of WSS services, SMART and consistent with MDGs on WSS?
  • Are the policy options summarised in Section 4 complete and reasonable? If not, how could these be improved and what other options could be considered?

Annex A: Technical Assumptions made in the Baseline Scenarios FEASIBLE Model

The main technical assumptions made in the development of the baseline scenario are set out below separately for urban and rural settlements. As well as assumptions, the sections below indicate how the model has been developed to reflect the overall situation for the Kyrgyz Republic, i.e. how all settlements have been included in a manageable way.

The main technical assumptions made in the development of the baseline scenario are set out below separately for urban and rural settlements. As well as assumptions, the sections below indicate how the model has been developed to reflect the overall situation for the Kyrgyz Republic, i.e. how all settlements have been included in a manageable way.

Urban municipalities Water supply

  • Connection rates - The connection rates are based on the number of people registered for water supply connections. These may underestimate the actual proportion connected as they do not account for illegal connections or under-estimates of the population in each household. For example in Karakol, 56% of the population is registered as connected but the opinion of the vodokanal is that 80% is actually connected. Where data is not available for the percentage of the population served by the central WS system, this value is assumed to be 60%: the average connection rate where data is available. The remaining population are assumed to collect water from sources which do not involve any expenditure by the vodokanal (e.g. private well, rivers).
  • Connection types (in-house versus street connections) – Whilst there is normally data on the proportion of the population (or absolute number) that is supplied water by the vodokanal, there is rarely information on the proportion of people that have in-house or street-post connections. Analysis of national data indicates that a split of 70% in house and 30% street post is about the average (although this varies significantly between municipalities). This split has been used in those municipalities where no data is available.
  • Connection types (yard versus in-house connections) - Residents connected via yard-taps are currently included as having in-house connections. However, analysis has shown that water supply expenditure modelled in FEASIBLE is not dependent on connection rates (of different types). Total water production volumes are entered separately and it is this factor which determines expenditure.
  • Water production - Production quantities are in almost all cases modelled as the total invoiced quantities for population, commercial enterprises and budget organisations. These values are actually estimates of consumption by the vodokanal based on soviet normative consumption values which may not reflect actual production. The use of total invoiced volumes based on consumption norms may be underestimating expenditure by as much as 50%.
  • Water losses - in almost all cases, there is no data on water losses (leakage). Occasionally a qualitative estimate is given and these are between 20 and 50%. Where no data is available, an average leakage rate of 25% has been assumed in all cases.
  • Treatment - in most cases, no treatment option is selected in the model as even the lowest form of treatment includes chlorination, coagulation, flocculation and sedimentation. Instead, under ‘additional expenditure’, chlorination costs have been assumed and entered based on a cost of 135 som/kg for hypochlorite.
  • Pumping - a 25% pumping efficiency rate has been assumed in all cases where no data is available (almost all cases) as almost all pumps are decades old and in poor condition.
  • Renovation (of water treatment assets) – the assumption has been made that the current and future value of assets are both 10% of the original value – and so are assuming here that it is the difference between current and future value which determine the need for renovation and not the actual value.
  • Correction factors for terrain - rocky/hard ground has been assumed for all areas, as well as high water tables in Talas and Osh (unless data available suggest differences elsewhere).
  • Quality and regularity – As a default, and unless stated otherwise, surface water sources are generally assumed to be below acceptable standards and ground water sources are assumed to be of acceptable standard.

Waste water

  • Connection types - Where specific data is not available, it is assumed that 20% of the population are connected to a central system (the average for those towns with data) and that the remainder have no sewage treatment (i.e. they have yard latrines with no expenditure requirement for the vodokanal).
  • Unless specific data exists to suggest otherwise, it is assumed that none of the population in small to medium sized towns/cities are connected to septic tanks as few are lined and require no O&M expenditure.
  • In Bishkek, it is assumed that 20% have septic tanks in addition to the 47% of the population who are connected to the central system. In Osh, in addition to the 17% declared to be on the central system, it is assumed that 10% of the population have septic tanks.
  • Network - The default assumption is that there is no renovation of sewer networks as any maintenance occurring at present in Kyrgyzstan is in response to leakage and not part of a planned program of renovation.
  • Infiltration - is assumed to be 10% of sewage flows reaching a wastewater treatment works.
  • Treatment (central system) – in all cases only the mechanical option has been selected.
  • Septic tanks - 125 people per septic tank has been assumed, based on the average occupancy rate in 30 apartments in a 3 story block of apartments. The volume per tank value has a default value of 62.5m3/tank.

Rural settlements with populations of less than 10,000 people There are over 1,800 rural settlements, too many to enter individually into the model. Therefore, the villages in each oblast have been broken down into four categories, depending on size and whether they have had water supplies improved under either the World Bank or ADB Rural Water Supply and Sanitation projects. The four categories are:

  • World Bank or ADB project villages with less than 750 residents
  • World Bank or ADB project villages with between 750 and 10,000 residents
  • Non-project villages with less than 750 residents
  • Non-project villages with between 750 and 10,000 residents

Each of these categories is entered as a representative settlement for each oblast in the model, with information included on the number of villages in each category and the average population for each category. In the rural areas, only water supply has been covered. There are no sewerage systems and sanitation services take the form of septic tanks or communal and/or household pit latrines. For the calculation of user charge contributions to financing the sector, only the villages under the WB/ADB projects are assumed to collect tariffs on a regular basis. The amount of tariff collected has been calculated for each category using data collected from the WB/ADB PMUs on population, tariff rate and average collection rate.

Rural settlements with populations of more than 10,000 people Rural settlements with populations above 10,000 people must be included as urban centres in FEASIBLE. In total, 34 of these exist in Kyrgyzstan and these are now included in the model. No Urban Institute reports exist for these villages therefore some common assumptions were made based on visits to a representative sample of them and knowledge of the rest of the country: These villages have been included as single municipality groups for each region (Oblast) with the number of villages and the average population included. The connection rate is assumed to be 50%, entirely through street-post connections. The remaining population is assumed to take water from other sources such as private wells. Insufficient information is available to assess total billed volumes of water so production volumes have been calculated based on the connected population and the consumption norm of 35 litres per day for street-post connections. Production volumes for industry and other (government) organisations were calculated based on the average proportions of total water production in other towns in Kyrgyzstan (i.e. 58% of total production to household, 20% to industry and 22% to government organisations). Water is assumed to be entirely from gravity-fed surface water sources with no treatment. Network length was calculated from the average length per connection in other Kyrgyz towns. Total billed revenue was calculated using the total consumption volumes and assuming tariffs which were in use in the large villages which the project team visited (i.e. 1 KGS/m3 for households, 6 KGS/m3 for industry and government organisations). Collection rates were assumed to be 50% for households and 100% for industry and government organisations, as was the case in the villages visited. No waste-water infrastructure is included in the model. It is assumed that the entire population uses yard latrines. In some cases, very small central systems existed but these had been neglected and were no longer used.

Costs and financing The FEASIBLE model has default values for costs which it uses to calculate expenditure on water supply and sanitation. In the baseline scenarios, the default costs have been changed to account for the Kyrgyz Republic context. The following values were used for prices to apply to the whole country:

  • Land: 50 KGS/m2
  • Power: 1.05KGS/kWh
  • Fuel: 37 KGS/litre
  • Labour (blue collar): 12,000KGS/year
  • Labour (white collar): 60,000KGS/year
  • Consumables, equipment, buildings/construction materials and other costs are assumed to be 40% of international norms.

Further resources and links

OECD EAP Task Force Water Supply and Sanitation Sector Reform

EU Water Initiative EECCA


  1. Central Asia – Regional and National Water Sector Review
  2. Kyrgyzstan: DFID/WB - Rural Water Supply and Sanitation Project
  3. Roadmap of the Kyrgyz NPD on Financing Urban and Rural WSS in Kyrgyzstan
  4. Rural Water Supply & Sanitation 2

Source(s)

DESCRIBE/LINK SOURCE(S) OF ARTICLE TEXT HERE

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