Home > Policy Instruments > Grid Integration in India > Financial and Physical Sustainability

Share your knowledge

Financial and Physical Sustainability

Introduction

• Emphasis on the physical and financial sustainability of existing facilities • Adoption of a rotational water distribution system and supply of water on a volumetric basis subject to certain ceilings and rational pricing

Rationale

  • • Maintain the existing facilities with optimum finance and usage

Basic elements of design

• Regulation of water tariff/pricing, allocations, monitoring operations, reviewing performance, etc. • Water tariff set at time bound cost-recovery resolving inter-country; inter-state; intra-State water-related disputes • Water charges for various uses should be fixed to cover the operation and maintenance charges of providing the service initially and a part of the capital costs subsequently • These rates should be linked directly to the quality of service provided • The subsidy on water rates to the disadvantaged and poorer sections of the society should be well targeted and transparent • Conservation incentives should be given

Potential challenges

• Prioritising water allocation and tariff • Difficult to allocate charges • Inadequate water tariff collection system

India experience

• Groundwater extraction when used for different purposes remains unaccounted in the tariff system and therefore, very minimal bill is generated for the water usage • Minimal collection of water tariffs/pricing

[Contributor: Deepshikha Sharma, PhD Scholar, TERI University, New Delhi, India]