Valuing the Costs and Benefits of Improved Wastewater Management

Introducing a Pilot Study and Resources for use in the Wider Caribbean Region

28th October 2015


Under Component 2 of the GEF CReW Project, UNEP CAR/RCU coordinated Pilot Resource Valuation Studies which were conducted at three sites in two participating countries, Panama and Trinidad and Tobago, by the World Resources Institute (WRI), working with local agencies, between October 2014 and August 2015. Both countries are signatories to the Protocol on Land Based Sources of Marine pollution (LBS Protocol) with obligations to improve wastewater management in their respective countries.

Experiences from the development and application of this resource valuation methodology for use in wastewater management planning were shared with GEF CReW participating countries at a Regional “Resource Valuation Workshop”convened by UNEP CAR/RCU and the GEF CReW Project from 23rd– 24thAugust 2015 in Miami, Florida,on the fringe of the Caribbean Water and Wastewater Association’s (CWWA) 24th Annual Conference and Exhibition. Prior to this, national workshops were held in both countries, to obtain local input, share and review the results.  The results of the resource valuation studies were discussed at the Regional Workshop and are now being disseminated.  A technical paper based upon the study was also presented at CWWA’s Conference.

Low investment in wastewater management is the norm in countries of the Wider Caribbean Region.  Our governments have not ensured that providers of wastewater services have sufficient funding to cover the costs of developing and operating wastewater systems; households and businesses are seldom willing to pay for available wastewater services (such as sewerage), or to invest in their own, unless required by law.

Getting governments to understand the importance of improving wastewater management, and crucially, the benefits that accrue as a result of better wastewater management is a priority for the GEF CReW Project as we better understand the challenges that exist. 

As it is, governments see wastewater as having little to  no revenue earning potential and its treatment as a service no one wants to pay for.  Changing this perception and the attitudes that result is difficult.  Even small investments in appropriate systems can make a significant difference.  If, in addition, we look at treated wastewater as a resource, it is possible to realize even more environmental, social and economic benefits.

The benefits of wastewater treatment are many but because they are seldom quantified, they are undervalued or ignored. 

Resource Valuation can assist countries by making stronger justification for wastewater investment and by helping to identify the most cost-effective management approaches.  Economic Valuation enables the accounting for services which otherwise go unaccounted for in decision-making.  It helps to highlight economic importance, as well as helps with the setting of fees, and in determining compensation for damages.

This study essentially examined the trade-offs between ecosystem and human health and the costs of investing in improved domestic wastewater management for the three pilot sites.  These were selected based on input from the in-country executing focal points: in Trinidad and Tobago - the Environmental Management Authority (EMA); and in Panama - the Panamanian Ministry of Environment (MdA). The pilot sites selected were the Buccoo Reef / Bon Accord area in Southwestern Tobago; the Borough of Chaguanas, near the Caroni Swamp in Trinidad; and Isla Colon in Bocas del Toro Provence, Panama.

The overall aim of the study was to improve the regional understanding of the connections between wastewater treatment and human and ecosystem health and to enhance the capacity within the Wider Caribbean Region for conducting economic valuations related to wastewater management investments and to use the findings to develop a generalizable economic valuation approach which could be applied in any country in the Wider Caribbean Region.

The policy question for this Resource Valuation Study was:

  • How do the benefits to ecosystems, the economy and human health compare to the cost of investing in improved wastewater management? (within a given study area)

The valuation methodology used by WRI is based on typical economic analyses used by infrastructure decision-makers, but tailored for water resource managers and updated to consider ecological and health co-benefits from wastewater treatment.  In all three locations Multi-Criteria Decision Analysis (MCDA), was used instead of Cost-Benefit Analysis because, based on best available data and expert input, it allows those interested in the research question to weigh the benefit and cost trade-offs based on a key set of criteria deemed important for decision-making including changes in costs, water quality, ecosystem impacts, and human health impacts.

It should be noted that the study of Isla Colon in Panama is a work in progress as consideration of different scenarios has not yet been completed.

The report prepared by WRI and titled: “Valuing the Costs and Benefits of Improved Wastewater Management: An Economic Valuation Resource Guide for the Wider Caribbean Region” consists of the following components:

  • Part I: Summary Report
  • Part II: Economic Valuation Guidance
  • Annex 1: Characterization Form and Technical Summary Templates
  • Annex 2: Supplementary Materials
  • Annex 3:Characterization Results

It is now available on the GEF CReW Project website, under Resources at:

The Spanish version of Part I: Summary Report will soon be available.

In addition the WRI guidebook “Coastal Capital: Ecosystem valuation for decision-making in the Caribbean,” (Waite et al. 2014), upon which the approach used in this valuation study is based, is also being made available under Resources in both English and Spanish.

The GEF CReW Project wishes to acknowledge and thank the World Resources Institute and all partners in Trinidad & Tobago and Panama who contributed to this important Pilot Study.


For more information contact:

Donna Sue Spencer,
Communications Specialist,
GEF CReW Project 
This email address is being protected from spambots. You need JavaScript enabled to view it.orThis email address is being protected from spambots. You need JavaScript enabled to view it.

What is the CReW?

The CReW is a four-year project that began in 2011. It is funded by the Global Environment Facility (GEF) and implemented by the Inter-American Development Bank (IDB) and the United Nations Environment Programme (UNEP).

Our Location

Project Coordinating Group

Caribbean Regional Fund for Wastewater Management
c/o Inter-American Development Bank (IDB)
40 - 46 Knutsford Boulevard
Kingston 5
Jamaica, W.I.

Phone: +(876) 764-0815


Permission is granted to duplicate materials for non-commercial, non-profit use only, provided acknowledgment is given. All other rights are reserved.