1. Economics of Drinking Water Safety Planning in Palau: an advocacy tool * Water Services Coordinator, Pacific Islands Applied Geoscience Commission, Mead Road, Suva, Fiji Islands. (E-mail: tasleem@sopac.org) ** Resource & Environmental Economist, Natural Resource Economics, Pacific Islands Applied Geoscience Commission, Mead Road, Suva, Fiji Islands. (E-mail: federica@sopac.org) Tasleem Hasan* & Federica Gerber**

2. Outline Objective Overview - Drinking Water Safety Planning DWSP in Palau Economics Recommendations and Conclusion

3. Objective To showcase the economic assessment of the Koror-Airai drinking water safety plan, illustrating the potential returns from implementing the plan and associated improvement schedule. To advocate for the benefits of drinking water safety planning

4. Drinking Water Safety Planning Risk assessment and risk management approach to ensure safe drinking water supplies Catchment to consumer approach Pro-active approach promoted by WHO as opposed to traditional reactive approach, which has limitations.

6. Day 1 at 10.00am water sampled and sent to lab for testing

7. Day 1 at 11.00am Day 1 at 1.00pm

9. Day 2 at 10.00 am results are read. Its all good, no contamination. But seeing the sequence of events we know:

10. BUT the community has consumed the contaminated water. RESULT – people get sick Toilet

11. So instead of only relying on end-point water quality testing implement drinking water safety planning. In the example shown what could that be: Source water protection – do not allow pigs near the intake zone Water operators training, regular inspections, standards operating procedures etc.

12. Details on DWSP:

13. Pacific Region DWSP in Palau

14. Palau is being supported by SOPAC and WHO to implement the DWSP approach, among other countries The drinking water safety plan for the Koror-Airai water supply has been developed along with an improvement schedule Important thing to note is that the PLAN is not the end, the PLAN should be implemented and reviewed and the risk assessment and risk management should become part of day- to-day operations Federica will now use economics to demonstrate the benefits of implementing the drinking water safety PLAN for the Koror- Airai water supply

15. Definitions & Methodology Economics concerns the efficient allocation of scarce resources Economics work at SOPAC is primarily for advocacy Data is collected in situ during 1 week Cost Benefit Analysis or CBA is used as well as with or without analysis Discounting is used to account for future values Sensitivity analysis is used to account for data inconsistencies Report in press and summary has been presented to country counterparts

16. Major Potential Benefits of DWSP Without drinking water safety planningWith drinking water safety planning Benefits No immediate investment so would seem as saving Reduced health care costs Reduced purchases of alternative sources of water CostsHealth costs for treatment of gastrointestinal health impacts induced by unsafe water. Loss of water through leakage Purchase of alternative sources of water Installation of equipment as part of improvement schedule Maintenance costs of new equipment installed Education and awareness-raising costs Change to pro-active approach of risk assessment and management Other benefits include: investment planning, greater risk assurance and more integrated approach

17. Findings from Palau Estimated total present value of cost of establishing and implementing the K-A drinking water safety plan: US$ 0.2 million Estimated total present value of benefits over time is expected to be US$ 1.34 million Expected net present benefits: US$ 1.11 million Benefit: cost ratio of 6: 1  i.e. US$6 payoff for each dollar invested

18. Koror-Airai Water Treatment Plant

19. Future Work & Recommendations Koror-Airai DWSP improvement schedule should be implemented as planned and reviewed periodically as required DWSP approach should be replicated across the water supplies in Palau Quantitative outcomes to be used to advocate continued DWSP investments at national and regional levels Water demand management practices as a component of the Koror-Airai DWSP should be improved Access to data relevant to water economics should be improved

20. Concluding Remarks CBA shows that the benefits are greater than the costs of DWSP improvement with an estimated benefit: cost ratio of 6: 1 Critically important benefit  reduced water-induced gastrointestinal diseases Advocacy support to further the work on DWSP in Palau and in the Pacific Drinking Water Safety Planning is the way to go!

21. Acknowledgement: Navneet Lal (SOPAC Library) for assisting with the graphics Vinaka Vakalevu