Valuing water and wastewater service improvements via impact-weighted numbers of service failures

Abstract

ABSTRACT Stated preference valuations of water and wastewater service improvements in Great Britain have been found to be highly variable across studies for similar units of service, driven primarily by a substantive dependence on the scope of service change offered to survey participants. The present paper motivates and describes a new approach that is simpler for survey participants and sidesteps the key problems caused by scope insensitivity. It relies on first deriving estimates of the relative impact of different types of service issue, and then using these to apportion a package valuation into valuations of individual service level improvements. The paper presents a case study that implements the new approach in a real business planning context and discusses the impact the new approach has on the valuation results obtained. We contend that the new approach has significant advantages over traditional discrete choice experiment approaches to water and wastewater service valuation and recommend it for future use in similar policy/planning contexts.