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To design pro-poor concession arrangements in the water sector, policymakers must pay careful attention to how the proposed contract, and existing or proposed regulations, will affect private concessionaires' ability, obligations, and financial incentives to serve low-income households; The Bolivian government awarded a concession for water and sewer services in La Paz and El Alto in 1997. One goal of doing so was to expand in-house water and sewer service to low-income households. Komives uses the Aguas del Illimani case to explore how the design of typical concession agreements (with monopoly private service suppliers) can affect outcomes in poor neighborhoods. She finds that outcomes in services can be affected by the concession contracts, by the contract bid process, by sector regulations, and by regulatory arrangements. To increase the likelihood of improvements in low-income areas, policymakers should: Make contract objectives clear and easily measurable; Eliminate policy barriers to serving the poor (including property title requirements and service boundaries that exclude poor neighborhoods); Design financial incentives consistent with service expansion or improved objectives for low-income areas. Contracts are subject to negotiation, so expansion or connection mandates alone do not guarantee that concessionaires will serve poor areas. Provisions and standards that reduce service options (for example, requirements that eliminate all alternatives to in-house connections) or restrict the emergence of new service providers (for example, granting exclusivity in the service area) could do more harm than good. In two years of operation, Aguas del Illimani met its first expansion mandate and took many steps to facilitate the expansion of in-house water connections in low-income areas. The company and the Bolivian water regulator were willing to discuss and seek possible solutions to problems associated with servicing poor neighborhoods. It is too early to tell whether these gains will be sustainable or to predict how privatization will ultimately affect poor households in La Paz and El Alto. This paper - a product of Private Participation in Infrastructure, Private Sector Development Department - is part of a larger effort in the department to analyze and disseminate the principles of, and good practice for, improving service options for the poor through reforms for private participation in infrastructure. The author may be contacted at komives@email.unc.edu.
Concession Contracts --- Contract Objectives --- Cost Recovery --- Financial Incentives --- Industry --- Low-Income Households --- Private Companies --- Private Participation --- Public Utility --- Public Water --- Sanitation Service --- Sanitation Services --- Sanitation Solutions --- Service Providers --- Service Supplier --- Sewer Service --- Town Water Supply and Sanitation --- Urban Areas --- Urban Water Supply and Sanitation --- Utility Model --- Water --- Water and Industry --- Water Conservation --- Water Resources --- Water Sector --- Water Supply and Sanitation --- Water Supply and Sanitation Governance and Institutions --- Water Utilities
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Large and growing subsidies to residential consumers in Mexico have become a major policy concern. This report explains the growth of subsidies, the current distribution of subsidies across income classes, and uses utility and household survey data to simulate how alternative subsidy mechanisms could improve distributional and fiscal performance. The goal is to help inform discussion in Mexico about how to reduce subsidies and redirect them toward the poor. The findings also offer lessons for other countries that are planning tariff reforms in their electricity sectors.
Electric utilities --- Subsidies --- Rates
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"This book is an extremely thorough and readable review of how effective utility subsidies are in reaching the poor. It makes sobering reading for policy makers who have implemented such subsidy programmes, who are looking for ways to ameliorate heavy price increases, or who believed that these subsidies were useful instruments for alleviating poverty." - Catherine Waddams, Director, Center for Competition PolicySchool of Management, University of East Anglia, United Kingdom "This study makes a fine contribution, theoretical and empirical, in an area where much nonsense has been preached, and
Social policy --- Public expenditure --- Public economics --- Public utilities --- Subsidies --- Rates --- Business subsidies --- Corporate subsidies --- Corporate welfare --- Government subsidies --- Grants --- Subventions --- Vouchers (Subsidies) --- Welfare, Corporate --- Government aid --- Foreign trade promotion --- Trade adjustment assistance --- Municipal utilities --- Public-service corporations (Public utilities) --- Utilities, Public --- Utility companies --- Municipal franchises
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Si bien los subsidios a usuarios de servicios publicos son comunes tanto en el sector de agua como en el de electricidad, su eficacia para alcanzar y distribuir recursos a las personas mas pobres es objeto de amplio debate. Esta publicacion reune pruebas empiricas sobre el desempeno de los subsidios en diversos paises. El texto pone en evidencia la preponderancia de los subsidios a los usuarios, ofrece una tipologia de las muchas variantes que existen en el mundo en desarrollo y presenta varios indicadores utiles para evaluar la medida en la cual esos subsidios benefician a los pobres, con un enfoque en tres conceptos clave: incidencia en el beneficiario, incidencia del beneficio y valor material. Los hallazgos sobre el desempeno de los subsidios seran de utilidad para los encargados de formular politicas y para los profesionales del sector, quienes contemplan la posibilidad de introducir los subsidios, eliminarlos o modificarlos, y para aquellos que consideran que los subsidios a los usuarios de servicios publicos representan un instrumento de proteccion social.
Access To Safe Water --- Connection Fees --- Spanish Translation --- Tariffs --- Water Supply
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The poor in most parts of the world may have electricity (especially in urban areas), but they rarely have water, sewer, and telephone services. When they gain access to local services, however, many do decide to connect.
Electricity --- Poor. --- Costs.
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