Publication: Applying Results-Based Financing in Water Investments
Loading...
Files in English
909 downloads
Published
2014-05
ISSN
Date
2014-09-10
Editor(s)
Abstract
Given the broad array of issues and the complexity faced by the water sector as a whole (from irrigation to flood protection, to water conservation and hydropower), there is great demand for future exploring the potential of RBF and tackling the questions still unanswered about many of its operational dimensions. This document takes a closer look at some of the practical aspects of implementing various RBF water schemes. Chapter 2 provides an analytical framework to explore if and when RBF can be a viable option, shedding light on some key factors and preconditions that are necessary for RBF to work--with the understanding that it can be used either as an alternative or a complement to a more traditional input-based funding scheme. Chapter 3 then revisits the concepts discussed in the analytical framework through the analysis of various case studies of RBF approaches in different water-related areas. Some of the case studies are based on actual projects already implemented or ongoing, while others are an illustrative elaboration, given the lack of practical cases to use as sources. Chapter 4 presents some conclusions and lessons learned. The key challenges that are likely to be encountered in designing an RBF scheme deal with: the clarity and level of certainty of the relationships from input to output to outcomes (causal links); the ease and availability of measurable indicators; and, consequently, the optimal determination of the necessary incentive(s) to align the goals of the principal with the agents' deliverables. Appendix A presents a glossary of RBF concepts and acronyms. Appendix B presents specific results and indicators which may be relevant for different sectors.
Link to Data Set
Citation
“Rodriguez, Diego; Suardi, Mario; Ham, Marcel; Mimmi, Luisa; Goksu, Amanda. 2014. Applying Results-Based Financing in Water Investments. © http://hdl.handle.net/10986/20041 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Toward Integrated Water Resources Management in Armenia(Washington, DC: World Bank, 2015)The proper management of water resources plays a key role in the socioeconomic development of Armenia. On average, Armenia has sufficient water resources. Taking into account all available water resources in the country, Armenia has sufficient resources to supply approximately 3,100 cubic meters per capita per year well above the typically cited Falkenmark water stress indicator of 1,700 cubic meters per capita per year. These water resources are not evenly divided in space and time with significant seasonal and annual variability in river runoff. In order to address temporal variations in river runoff, the country has built 87 dams with a total capacity of 1.4 billion cubic meters. Most of these dams are single purpose, mainly for irrigation. Armenia also has considerable groundwater resources, which play an important role in the overall water balance. About 96 percent of the water used for drinking purposes and about 40 percent of water abstracted in the country comes from groundwater. Irrigation remains the largest consumptive user.Publication How to Develop Sustainable Irrigation Projects with Private Sector Participation(World Bank, Washington, DC, 2016-02-01)This is a handbook designed to guide governments, public authorities and other interested stakeholders in the process of designing and tendering sustainable Public-Private Partnership (PPP) arrangements in the irrigation sector. It takes a practical, step-by-step approach in describing what a government needs to do in preparing and implementing a PPP irrigation scheme from inception. The handbook takes account of the various stages of the irrigation value chain and how to handle private sector participation in irrigation schemes of different sizes and types. It assumes that governments have already made the underlying policy decision to embark on a PPP in irrigation, and therefore does not dwell on the rationale for undertaking a PPP. The handbook’s practical aspects are contained in four, stand-alone chapters that follow an over-arching Executive Summary and an Introduction. The chapters are deliberately numbered to coincide with the four steps that a government should take in establishing an irrigation PPP: Preparation, Structuring, Procurement Management, and Implementation. In addition, each chapter concludes with a practical Checklist to help executives keep track of the necessary tasks in each step on the way to establishing a sustainable PPP operation. The chapters are designed to be read as stand-alone guides, out of an understanding that institutions using the book may already have completed prior steps. Nevertheless, it would be prudent for users to acquaint themselves with the entire handbook so as to develop a holistic view of the requirements for a full PPP project. Chapter One: Preparation is divided into two parts, A and B (each with its own concluding Checklist). Part A reviews the scope for introducing PPPs into the irrigation sector, identifying the issues that policymakers should consider from the outset in order to make the private sector’s involvement feasible with a specific irrigation project.Part B discusses the irrigation as a business. It contains a variety of case studies—the first time such studies have been documented—with discussion of lessons learned, PPP types, transfer of investment functions in developing countries, competitive bidding, and third party involvement among the subjects covered. Chapter Two: Structuring a PPP sets out the various tasks that must be completed to structure a sustainable PPP contract. Chapter Three: Managing Procurement examines how to select a private contractor, which involves such factors as the fiscal commitments to the PPP, to what extent the process should be competitive and how that might be conducted and managed, and what issues are peculiar to PPPs in irrigation.Chapter Four: Implementation highlights management of the contract and establishment of those management structures, monitoring, penalties and grantor’s rights, use of performance bonds, enforcement of customer payments, dealing with changes to the contract, and contract expiry and asset handover. The overall structure of the handbook is illustrated below. The handbook is supported by three annexes: Annex 1 explains how to use the Excel Options Assessment Tool, , and Annex 2 provides case studies of 29 existing or emerging irrigation PPPs.Publication Handshake, No. 1 (March 2011)(International Finance Corporation, Washington, DC, 2011-03)In this issue: trends: 10 years of private-sector participation in water; interview: Mozambiques industry behind the tap; and feature: irrigating Brazils semi-arid northeast.Publication A Water Sector Assessment Report on the Countries of the Cooperation Council of the Arab States of the Gulf(Washington, DC, 2005-03)The main objective of the Water Sector Review in the member countries the Cooperation Council of the Arab States of the Gulf (GCC) is to (1) conduct a diagnosis of the current situation of the water sector, identify issues in the GCC region, evaluate the GCC governments' current water policies, and propose recommendations for improved Integrated Water Resources Management (IWRM) in Phase I of the study; (2) present key findings and recommendations at the GCC Water Conference in Bahrain, September 19-20, 2005, where Government officials, academic specialists and technical experts from the region would provide inputs to this study; and (3) if amenable to the GCC governments, conduct Phase II of the study to develop specific policies and action plans for more sustainable water resources management in individual GCC states.Publication Sierra Leone : Public Expenditure Review for Water and Sanitation 2002 to 2009(World Bank, Washington, DC, 2011-07)This review focuses on how public expenditure translates into the delivery of water supply and sanitation services in rural and urban areas in Sierra Leone. It describes the legal and institutional framework for the allocation of resources assesses access to Water Supply and Sanitation (WSS) services and past sector performance, and analyzes public expenditure in the sector, including the factors affecting the efficiency of use of resources, and makes recommendations. Water supply includes the supply, distribution, and usage of water for drinking, food preparation, and hygiene. Sanitation is defined as the sanitary disposal of liquid waste and the promotion of hygienic practices. The review covers the period from 2002 to 2009, a period of reconstructing after a decade of upheavals. Since 2002, democracy and a stable environment for development have been re-established in the country, especially since the 2007 presidential elections. Sierra Leone remains one of the poorest countries in the world.
Users also downloaded
Showing related downloaded files
Publication Digital Africa(Washington, DC: World Bank, 2023-03-13)All African countries need better and more jobs for their growing populations. "Digital Africa: Technological Transformation for Jobs" shows that broader use of productivity-enhancing, digital technologies by enterprises and households is imperative to generate such jobs, including for lower-skilled people. At the same time, it can support not only countries’ short-term objective of postpandemic economic recovery but also their vision of economic transformation with more inclusive growth. These outcomes are not automatic, however. Mobile internet availability has increased throughout the continent in recent years, but Africa’s uptake gap is the highest in the world. Areas with at least 3G mobile internet service now cover 84 percent of Africa’s population, but only 22 percent uses such services. And the average African business lags in the use of smartphones and computers as well as more sophisticated digital technologies that catalyze further productivity gains. Two issues explain the usage gap: affordability of these new technologies and willingness to use them. For the 40 percent of Africans below the extreme poverty line, mobile data plans alone would cost one-third of their incomes—in addition to the price of access devices, apps, and electricity. Data plans for small- and medium-size businesses are also more expensive than in other regions. Moreover, shortcomings in the quality of internet services—and in the supply of attractive, skills-appropriate apps that promote entrepreneurship and raise earnings—dampen people’s willingness to use them. For those countries already using these technologies, the development payoffs are significant. New empirical studies for this report add to the rapidly growing evidence that mobile internet availability directly raises enterprise productivity, increases jobs, and reduces poverty throughout Africa. To realize these and other benefits more widely, Africa’s countries must implement complementary and mutually reinforcing policies to strengthen both consumers’ ability to pay and willingness to use digital technologies. These interventions must prioritize productive use to generate large numbers of inclusive jobs in a region poised to benefit from a massive, youthful workforce—one projected to become the world’s largest by the end of this century.Publication Management Contracts and Water Utilities : The Case of Monagas State in Venezuela(World Bank, Washington, DC, 1998-12)The management contract for water and sanitation services in the Venezuelan state of Monagas, awarded in early 1997 to a Spanish firm, is one of very few signed and active management contracts in the water sector. Management contracts pose design challenges. Their built-in incentives do not include equity at risk, so surrogate incentives must be designed, such as a performance bonus. Deciding how to award these contracts is also a challenge, because they lie somewhere between technical assistance (which should be awarded on the basis of skill and experience) and a lease (which should be awarded on the basis of price). It is too early to say whether management contracts can evolve into a more high-powered form of private participation like a concession. But the early operational results are very positive, and the experience sheds light on when a management contract is the right choice, how it should be designed to introduce the right incentives for the contractor and the public representatives, and what steps to take in awarding it.Publication Wastewater? From Waste to Resource in a Circular Economy Context(World Bank, Washington, DC, 2019-08-30)The World Bank, with contributions from the CAF - Development Bank of Latin America, is promoting a paradigm shift, moving away from considering wastewater as a waste and recognizing its inherent value. As part of this collaboration, both organizations have co-organized sessions with key stakeholders at the World Water Forum and Latinosan, to encourage the water community to move towards a circular economy model. This joint note summarizes the main findings of this collaborative work.Publication Wastewater(World Bank, Washington, DC, 2018-03)A set of case studies was prepared as part of the World Bank’s Water Global Practice initiative 'Wastewater. Shifting paradigms: from waste to resource' to document existing experiences in the water sector on the topic. The case studies highlight innovative financing and contractual arrangements, innovative regulations and legislation and innovative project designs that promote integrated planning, resource recovery and that enhance the financial and environmental sustainability of wastewater treatment plants. This case study documents Atotonilco de Tula, Mexico.Publication Easing the Transition to Commercial Finance for Sustainable Water and Sanitation(World Bank, Washington, DC, 2017-08)Providing sustainable water supply and sanitation (WSS) services in developing countries remains an immense, and increasingly urgent, challenge. Chapter two sets out how the sector is currently funded and why business as usual is insufficient for meeting WSS-related goals, covering the size of the investment gap, and the challenges presented by the status quo. Chapter three proposes a financing framework toward more effective use of existing funds to enable the mobilization of new sources of finance, and explains the benefits and costs of commercial finance. Chapters four to six detail the three components of the financing framework, providing practical advice and global experiences that demonstrate how countries can begin to make progress. Chapter seven summarizes how stakeholders can bring the three components together to mobilize commercial finance, and provides the main conclusions and recommendations of the report.