Preliminary assessment of economic sustainability of water supply schemes in rural highlands of Oromia

The study consists in a preliminary analysis about the economic sustainability of rural water supply schemes management in the highlands of Oromia region and it aims at providing the WaSH sector in Ethiopia with a methodology for reviewing tariffs and post-project management. A quantitative analysis is carried out through the Average Incremental Cost method and by assessing the Break-Even Point achievement of a stratified sample of water schemes, respectively considering: O&M, Depreciation and Capital Investment Return. Despite the limited sample dimension, the methodology has been proven consistent with the challenging situation of the rural water supply sustainability. Hence the study offers relevant findings and reflections on the fragile link between tariff setting and cost-recovery necessities and the implications of low economic sustainability, which is often the main cause of water schemes malfunctioning. Finally, a more comprehensive investigation on the same theme across the sector in Ethiopia is suggested.