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A methodology to cost water services in a refugee context

The life-cycle cost approach to costing the provision of water services to refugees in camps

What is this tool?

This is a methodology to cost water services that has been adapted from the lifecycle costs approach (LCCA) initially developed and tested in regular settlements and which has currently been adopted by more than 80 organisations across the world. LCCA is a cost / benefit approach where real financial expenditure is converted into unit costs and compared with the service actually delivered to a given population in a given area. It identifies the true costs for providing a water service, not only for a few years but for an unlimited period of time, to a given population in a targeted area.

Why is it needed?

In a refugee context, this methodology is particularly adapted to post-emergency situations, when more permanent water systems are built and financial resources must be budgeted for to cover the operation and (minor and capital) maintenance of systems, but also the support for administration, management, monitoring and reporting functions endorsed by international agencies. However, the methodology could fit first emergency situations as well, as all the expenditure made on the provision of water is documented since the creation of the camp. The costs of providing water during the first emergency phase are thus identified, and could be compared across camps, time and countries to refine budgeting processes and budgeted expenditure also for a specific and usually short period of time.

How is the tool structured?

The report details the information required to cost the provision of a water service, the tool that has been developed to assess the level of service delivered to refugees and the calculations that convert financial expenditure into cost per system, per capita and m3. It also explains how to estimate the life-cycle costs for providing a targeted level of service to a given population.