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Assessing Cost Recovery

A New Comparative Framework in Line with WFD Article 9


Britta Ammermüller

This study proposes a comparative accounting framework for assessing cost recovery of water supply and sewerage services for households and agriculture in line with the requirements of Article 9 of the EU Water Framework Directive (WFD). It provides an integrative analysis of the partly contradictory objectives of Article 9 and the Directive’s approach to cost recovery. The book defines cost categories and accounting guidelines in line with the specific requirements of WFD Article 9. On this basis, an integrative framework for analysing different financing schemes for water services provision and their compliance with the objectives of Article 9 is developed, along with a pragmatic approach for the incorporation of environmental and resource costs in the overall cost recovery analysis.


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5 Conclusions and outlook 331


331 5 Conclusions and Outlook This chapter provides a summary of the problem statements addressed by this thesis and summarizes main findings of the analysis. It outlines remaining open issues, which were identified in the respective chapters, warranting further concretisation in upcoming WFD implementation cycles. Finally, it discusses further research needs identified through the analysis. 5.1 The problem statements of the thesis revisited Article 9 of the WFD formulates new and unprecedented objectives for water management in Europe, whose implementation will require the adaptation of existing practices. As the Article’s dissection in Chapter 1.4 revealed, four partly contradictory objectives are explicitly referred to or implied by the Directive’s text, namely: Objective 1: recovering financial and environmental and resource costs for water services; Objective 2: using water prices for setting incentives for efficient water resources use; Objective 3: making the polluter pay and ensuring an adequate contribution of water uses; Objective 4: establishing transparency of financial flows within the European water sector, and guaranteeing the sustainability of water ser- vices provision and infrastructural systems. Implementing these objectives in a way that allows for European cross-country comparisons is by no means straightforward. While a certain harmonisation of definitions and procedures could be achieved through an exchange within the economic working groups of the CIS Process at EU level, the definition of and the accounting rules for the cost categories to be considered in the assessment of cost-recovery as well as the accounting for different approaches to water service financing varies considerably across...

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