• Richard

Costing the SDG6's: $2.6trn? – really ??

I wanted to have in my mind a simple answer to the cost of achieving SDG6.1 & 6.2 ….. noting the appropriate slogan of the SDGs in their entirety: ‘trillions not billions’. So going to the excellent Hutton and Varughese ‘The Costs of Meeting the 2030 Sustainable Development Goal Targets on Drinking Water, Sanitation, and Hygiene, World Bank, 2016 I find the answer quite easily “The total capital cost of meeting targets 6.1 and 6.2 is $114 billion per year (range: $74 to $166 billion). So taking the 15 year period in which to achieve the targets this comes out at $1,710 billion – trillions indeed (well almost).

But then I read that “The total cost estimates include the resources required to put in place, operate, and maintain a WASH service for those without the service in 2015. The costs of maintaining access for those already served by a given service level in 2015 are excluded from the calculations.” Reasonable to make that assumption, really appreciating how the authors are quite explicit (and detailed) in the assumptions they have had to make.

But it left me wondering, as everywhere I travel to work there is massive unfunded OpEx and CapManEx, particularly the latter with so much renewal, rehabilitation and replacement maintenance required. They are in good company of course, noting the record of London (Thames Water gradually working to overcome the ‘one third of pipes older than 150 years, half older than one hundred years) and similarly many cities in North America.

So if we actually include ‘the costs of maintaining access for those already served by a given service level in 2015’ what number do we get? Trying to be systematic also in my assumptions, taking the reported 5bn people already with ‘safely managed’ and the 3bn people with ‘safely managed sanitation’ and subtracting a billion for the higher-income countries, then taking the Median of the CapEx costs reported for the countries considered by H&V for 60% ‘Advanced Urban Water Piped on Plot’ and 40% ‘Advanced Rural Water’ (the 60/40 split being a slightly higher urban number than the standard global split because those with safely managed services tend to be in the countries already further along the rural urban transition) and a 3% CapManEx annual charge (sounds reasonable, average life of 30 years for the assets?) and a 2% OpEx charge (could easily have made that higher … will think about that) and we get to another $60 billion per year required on top of the unserved $114 billion per year. So actually $175 billion per year is required to achieve the SDG 6s ‘for all’ in MIC and LICountries. Or $2.6 trillion for the 15 year period.

We are also helpfully told that in 2014, development finance for water stood at just $18 billion per year (https://www.devex.com/news/what-you-need-to-know-from-stockholm-world-water-week-2018 newsletter) and “In 2015, ODA disbursements in the water sector totalled about $8.6 billion, which represents an increase of 67 per cent in real terms since 2005. ODA for the water sector has been rising steadily, but has remained relatively constant as a proportion of total ODA disbursements, at approximately 5 per cent since 2005.” (PROGRESS OF GOAL 6 IN 2017, https://sustainabledevelopment.un.org/sdg6)

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