Journal of Development Effectiveness

ISSN: 1943-9342 (Print) 1943-9407 (Online) Journal homepage: http://www.tandfonline.com/loi/rjde20

Cost-effectiveness and benefit–cost analyses of

some water interventions in Nigeria: the case of
Bauchi State

Eberechukwu Uneze , Ibrahim Tajudeen & Ola Iweala

To cite this article: Eberechukwu Uneze , Ibrahim Tajudeen & Ola Iweala (2012) Cost-
effectiveness and benefit–cost analyses of some water interventions in Nigeria:
the case of Bauchi State, Journal of Development Effectiveness, 4:4, 497-514, DOI:
10.1080/19439342.2012.716075

To link to this article: http://dx.doi.org/10.1080/19439342.2012.716075

Published online: 14 Sep 2012.

Submit your article to this journal

Article views: 69

View related articles

Citing articles: 1 View citing articles

Full Terms & Conditions of access and use can be found at

http://www.tandfonline.com/action/journalInformation?journalCode=rjde20

Download by: [University of Otago] Date: 30 September 2015, At: 06:13

 Journal of Development Effectiveness
Vol. 4, No. 4, December 2012, 497–514

Cost-effectiveness and benefit–cost analyses of some water

interventions in Nigeria: the case of Bauchi State
Eberechukwu Uneze*, Ibrahim Tajudeen and Ola Iweala

Centre for the Study of the Economies of Africa (CSEA), Maitama, Abuja, Nigeria

This study presents a cost-effectiveness analysis and a benefit–cost analysis (BCA) of

water interventions in Bauchi State, Nigeria, with particular emphasis on pipeline and
Downloaded by [University of Otago] at 06:13 30 September 2015

borehole (hand pump) water supply programmes. The cost-effectiveness ratios show
that the borehole water programme is more cost-effective than the pipeline water pro-
gramme. The results of the BCA show that both programmes are beneficial, although
borehole water supply has a higher benefit–cost ratio. On the whole, the results of the
cost-effectiveness and benefit–cost analyses suggest that the borehole water scheme is
more efficient and sustainable.
Keywords: cost; effectiveness; benefit; pipeline water supply; borehole water supply;
sensitivity analysis

1. Introduction
The type of access and quantum of water supply, as well as the quality of sanitation facil-
ities available to households or communities, determine the quality of life of the people
and the potential for poverty alleviation. In spite of its abundance, however, it is estimated
that about 900 million people do not have access to improved drinking water supply, with
84 per cent living in rural areas. More so, about 330 million of the 900 million people
reside in sub-Saharan Africa (WHO and UNICEF 2010). Additional estimates show that
1.8 million people die every year as a result of diseases caused by unclean water and poor
sanitation (WHO 2008a). This problem is even more serious in developing countries where
a large number of women and children in rural areas spend hours each day walking several
kilometres to collect water from unprotected sources such as open wells, muddy dugouts
and streams. For example, in Nigeria a large population still does not have access to good
quality water in adequate quantity. It is estimated that only about 65 per cent of the urban
and 30 per cent of the rural population have access to improved drinking water sources.1
Several reasons are responsible for this, and include among others, poor planning, inade-
quate funding, insufficient relevant manpower, poor implementation and wrong policy or
programme interventions.
Given the competing demand for available financial resources and the need to achieve
the water Millennium Development Goal (MDG) as well as the wider objectives of sustain-
able development, there is a need to pursue programmes that will reduce implementation
costs, increase access to portable water and have long-lasting impact on the communities.
Therefore, the broad objective of this study is to carry out a cost-effectiveness analysis

*Corresponding author. Email: euneze@cseaafrica.org

ISSN 1943-9342 print/ISSN 1943-9407 online

© 2012 Taylor & Francis
http://dx.doi.org/10.1080/19439342.2012.716075
http://www.tandfonline.com
 498 E. Uneze et al.

(CEA) and a benefit–cost analysis (BCA) of borehole water supply (BWS) (hand pump)
and pipeline water supply (PWS) programmes. Specifically, the study seeks to provide
answers to the following questions: Which of these interventions in the water sector,
namely BWS and PWS programmes is more cost-effective in terms of time savings and
health benefits? What is the relative efficiency of the BWS and PWS programmes in terms
of improved portable water accessibility and prevention of waterborne-related diseases?
In monetary terms, which of these interventions is more beneficial and sustainable with
respect to costs?
However, given the enormity of conducting an extensive CEA in terms of resource, time
and data requirements, it will be impossible to examine interventions extending to several
parts of the country. With these issues in mind, the scope of the study is limited to Bauchi
State. The choice of Bauchi State is helped by the availability of cost data from the Bauchi
State Water Supply Project and Bauchi State Water Board (BSWB). The remainder of this
Downloaded by [University of Otago] at 06:13 30 September 2015

study proceeds as follows: Section 2 presents a brief background of BSWB, including the
description of the selected programmes; Section 3 reviews the key and relevant studies
in the water CEA and BCA literature and Section 4 presents the methodology, including
sources of data. Section 5 discusses the findings of water CEA and BCA. Finally, Section 6
concludes with some policy recommendations.

2. Background of interventions
This section provides a brief discussion on the BSWB and some background of the PWS
and BWS programmes. Bauchi State has a population of 4,936,438 people, 617,054 house-
holds (as at 2008) and 20 local government areas. It occupies a total land area of
49,119 km2 , representing about 5.3 per cent of Nigeria’s total land mass (see Figure 1).
Bauchi State spans two distinctive vegetation zones, namely the Sudan Savannah and the
Sahel Savannah. In addition to its vegetation, Bauchi State is surrounded by a number of
rivers and dams for irrigation and other uses. They include the Gongola and Jama’are rivers
and the Gubi and Tilde Fulani dams. The BSWB is in charge of the regulation and coor-
dination of water supply activities in the state. The Bauchi State Government launched a
PWS scheme in 1992 and launched a state BWS scheme in 2007. This effort has resulted
in an increase in water supply investments throughout the state. These programmes are
the two most important (also common) water supply schemes in Bauchi State and Nigeria,
more generally. The massive investment is aimed at meeting the fast growing demand for
safe water and to also improve the socio-economic development of its populace, especially
those dwelling in the rural areas. The background information on the two programmes is
presented below.

2.1. Bauchi township pipeline water supply project

Prior to the establishment of this project, Gubi dam and groundwater sources were the
only available drinking water sources in Bauchi town. In 1987, only about 7300 m3 /day or
roughly less than 35 litres per capita per day drinking water was available for an estimated
population of 210,000. In order to supplement the existing supply, meet the daily water
needs arising from the projected population growth and enhance the adequacy of the sup-
ply to the newly established industrial zone in Bauchi, the PWS project was conceived. The
goal of PWS is in line with the sector’s goal of promoting good health and economic devel-
opment in Bauchi through the provision of adequate water supply. The project is aimed at
 Journal of Development Effectiveness 499
Downloaded by [University of Otago] at 06:13 30 September 2015

Figure 1. Map of Nigeria.

Source: www.nigeriamuse.com.

raising the level of water supply for an individual from about 35 litres per day to around
106 litres per day for an estimated population of about 400,000 by the year 2000. The
scope of the project comprises the construction of a new 45,500 m3 /day treatment plant, a
600 V/2100 kVA standby power station, a high lift pumping station, about 79 km of pump-
ing main transmission and distribution pipelines and provision of logistics. The estimated
total cost of the project is UA 50.67 million (NGN1.39 billion)2 and an AfDB loan of UA
44.95 million (NGN1.24 billion) was to be extended to the federal government of Nigeria
for on-lending to the Bauchi State Government in October 1989 for the implementation.
The balance of NGN0.15 billion was to be raised by the Federal Government as local co-
funding. The final project cost was UA 49.30 million (NGN1.35 billion) and was completed
in October 1992 instead of the stated completion date of December 1991 (AfDB 2000).

2.2. Bauchi borehole water supply programme

As at 2007, 45 million gallons of water were required by Bauchi metropolis daily, but only
2.5 million gallons were available. Water supply from the Gubi dam as at that time was in
the range of 25–30 per cent installed capacity. To meet the water MDG, and to, at least,
provide one borehole for 230–500 people living within 500 m radius from the water point,
the Bauchi State Government, through the MDGs office and Bauchi State Rural Water
Supply and Sanitation Agency, moved to boost water supply by providing solar-powered
boreholes, motorised boreholes and hand pumps. Under this scheme, boreholes were con-
structed in communities, villages, secondary schools, higher institutions and hospitals,
as well as organisations with acute water shortage. The project was expected to deliver
 500 E. Uneze et al.

231 motorised boreholes, 100 solar boreholes and 200 hand pump boreholes. According
to Bauchi State Commissioner of Water Resources, Bayero Bukar, in 200 9, 275 solar-
powered and motorised borehole projects have been completed and inaugurated. He also
added that 200 hand pump boreholes were constructed and commissioned. According to
Hajiya Hajara Wanka, the Senior Special Assistant, 2007–2011, to the Governor of MDGs,
about NGN4 billion was expended on motorised, solar and hand pump boreholes between
2007 and 2008. In specific terms, the State Government spent around NGN1.2 billion on
the execution of solar and hand pump BWS project in the state. Of this amount, NGN1 bil-
lion was used for the provision of solar boreholes. This amount was received from the
federal government under the MDGs Conditional Grant Scheme on water. The remaining
NGN200 million was a counterpart fund from the State Government and was used for the
drilling of 200 hand pump boreholes across the state. These figures do not include the
operations and maintenance cost and the management cost. The State Government also set
Downloaded by [University of Otago] at 06:13 30 September 2015

up a committee on the maintenance of boreholes drilled in the state. The aim is to ensure
adequate maintenance of all the water schemes.

3. Brief review of relevant literature

Studies of CEA and BCA have multiplied since 1950s. These analyses have been carried
out on water supply programmes, with different effectiveness and benefit measures such
as health and nonhealth benefits, prevention of waterborne diseases, water quality, sanita-
tion and others. For example, Clasen et al. (2007), by using effectiveness data from recent
systematic review of improved water intervention conducted by Clasen et al. (2006) and
cost data from programme implementers and World Health Organization (WHO) database,
conducted a CEA of water quality interventions aimed at preventing diarrhoea disease in
developing countries. The study compared nonpiped water source (dug well, borehole and
communal stand post) and four types of household-based interventions (chlorination, fil-
tration, solar disinfection and flocculation/disinfection). The interventions seek to improve
the microbial quality of water that can prevent diarrhoea disease. The analysis was based
on generalised CEA, an approach developed by WHO. The scope of the study was on two
WHO epidemiological sub-regions: sub-Saharan African countries with very high adult
and child mortality and Southeast Asian countries with high adult and child mortality. The
findings of the study, measured against international benchmarks, showed that water source
and household-based interventions were generally highly cost-effective, while household-
based chlorination was most cost-effective, especially where resources are limited and
household filtration also yields additional health gains at higher budget levels. Flocculation
(disinfection) was strongly dominated by all other interventions; solar disinfection was
weakly dominated by chlorination. However, the major weakness of the study by Clasen
et al. (2007) is that they did not include time savings in their assessment of the alternative
interventions. Haller et al. (2007) also estimated the costs and health benefits of water and
sanitation improvements at the global level. The study focused on interventions aimed at
increasing access to improved water supply and sanitation facilities, in-house piped water
and sewage connection and household water treatment in 10 WHO sub-regions. Laurence
et al. used the acute health effects of diarrhoea as the effect measure. The cost-effectiveness
of each intervention was assessed in terms of US dollars per disability-adjusted life year
(DALY) averted. The study found that almost all interventions were cost-effective in most
sub-regions, especially in developing countries with high mortality rates. This is even more
so for access to piped water supply and sewage connections – as they had the largest health
 Journal of Development Effectiveness 501

impact across all sub-regions. Overall, household water treatment was found to be the
most cost-effective intervention. The study concluded that using improved water and sani-
tation facilities such as dug wells, piped water and ventilated-improved latrine would bring
a major improvement in health. More extensively, Whittington et al. (2008) conducted a
cost–benefit analysis of investments in four alternative water and sanitation interventions,
including PWS and hand pump BWS projects. The study used a Monte Carlo simulation
approach to estimate the cost and benefits of portable water supply. Thereafter, a proba-
bilistic sensitivity analysis was used to estimate a frequency distribution of the benefit–cost
ratios for all four interventions, given a wide variety of possible parameter combinations.
The outcome of the study showed potential conditions in developing countries under which
these interventions can be effective. That is, the success of each intervention depends on
the specific context in which it is implemented. However, this study will draw on the work
of Whittington et al. (2008), particularly, the estimated effectiveness measure. Similarly,
Downloaded by [University of Otago] at 06:13 30 September 2015

a cost–benefit comparison of improved water supply investments and cholera vaccination

programmes has been presented (Whittington and Jeuland 2009). Using parameters such
as disease incidence, the effectiveness of vaccine and water supply interventions against
diarrhoea diseases and the value of statistical life (VSL), the study conducted a cost–benefit
evaluation of water interventions, namely deep wells with public hand pumps and biosand
filters, and two cholera immunisation programmes (school-based and community-based
programmes). In addition, a probabilistic sensitivity analysis was performed to estimate
a frequency distribution for benefit–cost ratio for interventions and the results of the
study showed that the two improved water supply interventions and targeted (school-based)
cholera vaccination programme were more likely to produce a more attractive cost–benefit
outcome than a community-based vaccination programme.

4. Methodology
This section sets out the assumptions, sources and methods of data collection, techniques
used for the cost-effective analysis and BCA and the description of the sensitivity analysis.

4.1. Assumptions
We assume the following: the operations and maintenance cost and management cost are
constant throughout the lifespan of the projects3 ; with the availability of alternative power
supply (generator), we assume that the PWS will run for 24 hours just like BWS; the esti-
mated average lifespan of PWS and BWS projects are 20 and 10 years, respectively; there
will be an increase in water consumption for other domestic purposes by households as
a result of time savings from the water interventions; the 106 litres per day per individ-
ual targeted by the programme will be achieved; the average number of beneficiaries per
borehole is 365 individuals4 ; the PWS and BWS programmes will deliver high-quality ser-
vices and positive health outcomes; and reduction in morbidity and mortality are the only
health benefits.

4.2. Data sources

This article uses data from the BSWB, Bauchi State Rural Water Supply and Sanitation
Agency and Federal Ministry of Water Resources. The PWS programme data are from the
Operation Evaluation Department of the African Development Bank. Given the challenges
 502 E. Uneze et al.

in getting the actual information on the programmes and their cost components, some
data were derived through several computations, following the relevant literature. We also
had informal discussions with some government officials and programme managers. Units
of measurement are litre, hour and household. In addition, the costs of all projects are
expressed in Naira (local currency) and converted to the same base year.

4.3. Programme cost-effectiveness analysis

This section presents the techniques adopted in conducting the CEA. It first examines the
relative effectiveness of the programmes by examining the achievement and impact of the
programmes on the targeted households.
Downloaded by [University of Otago] at 06:13 30 September 2015

4.3.1. Effectiveness measures. Although the PWS and BWS programmes have been
implemented by the state government in various parts of Bauchi State, there are little or
no data to capture the effectiveness of the two programmes. In most cases, the govern-
ment has not really seen the importance of conducting impact evaluations alongside the
execution of the programmes and this is neither peculiar to the water programmes nor to
Bauchi State Government. It is only in few instances, in particular, when donor-assisted
projects are involved that report on project execution are presented, and usually focus on
the accountability of funds allocated for the programmes.5 As stated earlier, three different
types of BWS programme (solar, motorised and hand pump boreholes) were implemented
in Bauchi State. Of interest to this study, however, is the hand pump BWS, which is the
most common borehole technology in Nigeria. In addition, given the lack of data to calcu-
late the effectiveness measure, this study adopts the two effectiveness measures reported
in Whittington et al. (2008), namely time savings that result from the installation of new
water source and health benefits (reduction in morbidity and mortality). The estimates
were based on Monte Carlo simulations, and for each of these measures, a plausible range
of values are specified based on professional judgement, and reference to related literature.
Thereafter, the probability distribution that determines the likelihood that a specific value
within the specific range will occur is assumed. The study was on developing countries,
especially Africa, and focused on five alternative water supply and sanitation projects. The
PWS and BWS programmes implemented by Bauchi State Government are similar to the
programmes identified in Whittington et al. (2008). This similarity therefore provides a
good justification for adopting some of the measures and methodology.

4.4. Benefit–cost analysis

This section explains the technique of BCA. For the BCA, the costs of the programmes –
BWS and PWS – are same as estimated for the CEA. There are several benefits associated
with PWS and BWS, including water quality, increased continuity of service provision,
environmental and sustainable impact, time savings and health benefits. However, due to
data limitation, the study will consider two benefits – time savings (direct benefit) and
health benefits (indirect benefit). The time savings from BWS and PWS are estimated
based on average market wage of unskilled labour and the percentage of time savings used
for economic activity (see Table A2 in Appendix). The health benefits are the values of
avoided morbidity and mortality distributed over the lifespan of the interventions (this is
estimated based on cost of illness (COI) from diarrhoea and VSL). After computing the
 Journal of Development Effectiveness 503

costs and benefit of alternative programmes, the net present value (NPV) and benefit–cost
ratio are calculated to evaluate the usefulness (attractiveness) of the programmes, and to
further decide on the programme to recommend for uptake and implementation. The BCA
is based on specific assumptions which include the following: with the provision of opera-
tions and maintenance cost, both BWS and PWS are assumed to run effectively during their
stated lifespan; the VSL is assumed to be the same for all the targeted beneficiaries of the
interventions; COI from diarrhoea, derived from recent survey, is assumed to be the same
for all the beneficiaries of the intervention; since most water interventions are targeted at
the poor, this study adopts the unskilled wage as a proxy for the average income of the
poor. More so, the estimates of the COI and VSL were derived from ILRI and World Bank
(2010) and ICF International (2009), respectively. Although, there are various studies with
estimated values of COI and VSL, the selected studies tried to provide an extensive review
of the existing estimates of the parameters alongside with a survey, before arriving at the
Downloaded by [University of Otago] at 06:13 30 September 2015

current estimates. While both studies were coordinated by World Bank, the former focused
on Nigeria and the later on sub-Saharan Africa.

4.5. Sensitivity analysis

In order to analyse the impact of uncertainty and to also determine the robustness of the
estimates and the underlying assumptions of this analysis, a one-way (including worse-
and best-case scenarios) and multi-way (with worse- and best-case scenarios) sensitivity
analyses are undertaken for the CEA and BCA. This highlights the impact on the results of
varying key parameters which are either uncertain or may change over time. The essence
of the analysis is to determine the extent to which one can rely on the initial results (con-
fidence level), given that some of the parameters were taken from the literature. Some of
the assumptions made also demand that a sensitivity analysis be carried out. In addition, it
helps to determine what level of variations of the underlying parameters will make the two
interventions equally cost-effective.

5. Results
This section presents the cost of the programmes, the results and discussions of the findings
on the CEA, BCA and sensitivity analysis.

5.1. Summary of costs

Computing the cost of the programmes posed a major challenge in this study as data on the
components cost for both programmes were not available. In most cases, only the capital
cost and expected number of beneficiaries of the programmes were made available. Given
this challenge, this study made use of the available data on capital cost and the estimated
operations and maintenance cost to derive the cost on a per household per year basis (see
Table 1).

5.1.1. Cost of pipeline water supply programme. For capital cost of PWS which includes
storage cost, transmission to treatment plant cost, treatment of drinking water cost, genera-
tor cost, standard distribution of water to households including house connection cost and
technical assistance cost, we adopt the figure in the AfDB (2000) performance evaluation
 504 E. Uneze et al.

Table 1. Computation of unit cost (in Naira) of PWS and BWS.

PWS BWS
Cost description Equation (1992 prices) (2008 prices)
   
Capital recovery factor CR = r(1 + r)d / (1 + r)d − 1 0.0672 0.1172
Capital (NGN per year)a C capital = CR ×C PWS  91,061,411 135,486
Operations and PWS: C O&M = PO&M × C capital ; 34,148,029 71,140
maintenance (O&M) cost BWS: C O&M
=C +C
O M
(NGN per year)
Total (annualised) cost C total/year = C capital + C O&M 125,209,440 206,627
(NGN per year)
Number of households n 50,000 47
Total cost per household C total/year /n 2504 4529
per year (NGN per year)b
Downloaded by [University of Otago] at 06:13 30 September 2015

Comparison of the CER for PWS and BWS programmes

Cost description PWS (2008 Prices) BWS
Total cost per household per year (in Naira) 53,005 4529
a Capital cost for PWS includes the cost of alternative power supply (generator).
b Household coverage (n) is used to determine the unit cost per household. It is not used as an effectiveness
measure. See Table A2 in Appendix for the detailed definition of variables.

report on Bauchi State township water supply project. Using a 3 per cent discount rate,
this implies a 0.06721 capital recovery factor for the entire lifespan of the project. This
means that the annualised capital cost of PWS is NGN91,061,411. The operations and
maintenance cost is derived using an average of 37.5 per cent of annualised capital cost;
therefore, the total cost per household per year is estimated at NGN2504 (see Table 1).6

5.1.2. Cost of borehole water supply programme. There are also challenges to the proper
costing of the BWS programme due to nonavailability of data on cost components, among
others. Similar method adopted in costing of PWS is employed for the BWS also. Although
the total cost of the programme and the number of planned boreholes are available, data on
the other cost components are not available. According to a study conducted by Adekile
and Olabode (2009) on public and private borehole drilling in Nigeria, and sponsored
by UNICEF and Rural Water Supply Network, the average economic cost of hand pump
borehole in Nigeria is made up of five components. It is possible that the cost of these com-
ponents may vary in different regions of Nigeria following the differences in topography
that will likely affect the depth of the borehole.
Adekile and Olabode further stated that the average depth of hand pump borehole in
the northern part of Nigeria is 50 m deep, and based on this, they estimated the average cost
of hand pump borehole at US$9750 (see Table A1 in Appendix). Given that Bauchi is a
representative state in Northern Nigeria, we adopt the hand pump cost estimated by Adekile
and Olabode (2009). Using the 2008 exchange rate of NGN118.57/US$, we estimate an
average cost of producing a hand pump borehole at NGN1,156,027. With this, the total cost
of the 200 hand pump boreholes is NGN231,205,455. Given a 3 per cent discount rate and
the average lifespan of 10 years, the capital recovery factor equals 0.1172. This implies an
annualised capital cost of NGN135,486. The average operations and maintenance cost and
management cost of NGN71,140 (or US$600) is taken from Whittington et al. (2008).7
With these, the total cost per household per year is estimated at NGN4529.
 Journal of Development Effectiveness 505

5.1.3. Unit cost of programme per household. Unit cost per household is derived by
dividing the annualised total cost of each programme by the number of household ben-
eficiaries (see Table 1). This represents the cost per household per year for the provision
of the interventions, and it is expected that the programme with the lowest ratio is more
cost-effective. The results in Table 1 show that the total economic cost per household per
year for PWS programme is NGN53,005, while that of BWS is NGN4529 per household
per year. This means that, on average, it will cost about NGN4529 to supply a household
with a BWS in a year, while it costs about NGN53,005 to supply the same household with
PWS in a year. This implies that the BWS programme is more economical than the PWS
programme. This is also true if one was to base the decision on capital investment per
household.
Downloaded by [University of Otago] at 06:13 30 September 2015

5.2. Programme cost-effectiveness analysis

The programme CEA extends the analysis of the unit cost by simultaneously examining
the unit cost of the programmes and the estimated programme impact.

5.2.1. Effectiveness and benefit measures. Table 2 shows the equations from which the
effectiveness measures of PWS and BWS are derived. As stated earlier, two different
effectiveness measures are adopted for the CEA.
Table 3 presents the estimated absolute values of the programme’s effectiveness-based
time savings, morbidity and mortality measures.

5.2.1.1. Time savings. Prior to the PWS and the BWS interventions, an average indi-
vidual in Bauchi State collects water from traditional and other sources far from home.
According to AfDB (2000), an individual uses about 35 litres per day, which is 280 litres
per day for a household of eight people. Since the amount of water an individual uses is a
function of time, Whittington et al. (2008) estimated that the average time taken by an indi-
vidual to fetch 20 litres of water from a typical traditional source in developing countries

Table 2. Computation of effectiveness measures for PWS and BWS programmes.

Values Values
Effectiveness measures Equations (PWS) (BWS)

Time savings (hours) experienced T1W = T0W − T1W , where 0 is 1.17 hours 0.58 hour
in period 1 collecting 35 litres per the pre-intervention and
day per individual 1 post-intervention period
Total time savings: water (hours per TTS = T1W × S × 365 3407 hours 1703 hours
household per year)
Avoided morbidity (per household V morbidity = I × E × S 8.18 2.73
per year)
Avoided mortality (per household V mortality = I × E × S × CFR 0.0069 0.0023
per year)
Health benefits (per household per V HB = V morbidity + V mortality 8.19 2.73
year)

Notes: The time savings resulting from PWS is equivalent to the exact time spent in collecting water before
intervention, since households can now access water directly from their houses. Thus, zero (0) time is required to
fetch water from PWS. See Table A2 in Appendix for the detailed definition of variables.
 506 E. Uneze et al.

Table 3. Estimated increase in effectiveness of PWS and BWS programmes in Bauchi State.

BWS PWS
Before After Before After
inter- inter- inter- inter-
Effectiveness measure vention vention Improvement vention vention Improvement

Time spent collecting initial 3407 1703 1703 3407 0 3407

quantity of water (hours per
household per year)
Reduction in morbidity 10.91 8.18 2.73 10.91 2.73 8.18
(nonfatal cases of diarrhoea
per household per year)
Risk of death from all diarrhoea 0.0092 0.0069 0.0023 0.0092 0.0023 0.0069
(reduction in mortality) per
household per year
Downloaded by [University of Otago] at 06:13 30 September 2015

would be 1 hour –20 litres per hour. Similarly, Rosen and Jeffrey (1999) study of house-
hold water resources and rural productivity in sub-Saharan Africa found that the average
quantity and time spent per carrier per day range from 0.28 to 1.72 per hour, with some
carriers spending as little as 0.12 hour or as much as 4.4 hours per day. Using an average of
20 litres per 0.67 hour, we estimate that an individual will spend roughly 1.17 hour to fetch
35 litres of water per day from existing sources. This means that a household spends about
9.3 hours a day to fetch water (that is, 3407 hours per year). The results that emerge show
that with the introduction of the BWS and the PWS, it will, on average, take 0.33 hour to
fetch 20 litres of water from a borehole and zero (0) time from piped water, respectively.8
This means that a household will now save a total of 3407 hours a year with the introduc-
tion of PWS. For the BWS intervention, a household will now spend 280 minutes a day to
fetch the same amount of water, saving approximately 1703 hours per year.

5.2.1.2. Reduction in morbidity. Results of water interventions on diarrhoea incidence

vary widely along various water supply projects and across regions. It is expected that
improved water supply from PWS and BWS interventions in developing countries on
the average has the capacity to reduce the diarrhoea incidence rate within the range of
60–90 per cent for PWS and 10–40 per cent for BWS (Whittington et al. 2008). Although
a number of potential factors could be influencing morbidity (as well as mortality) at the
same time, we think that the range of values provided by Whittington et al. is fairly realistic
estimates. That said, we recognise that more precise estimates are likely to be derived from
studies with proper control groups and counterfactual. Drawing on WHO (2002) report, the
estimated incidence of diarrhoea for Nigeria is 1.36 cases per capita per year.9 Therefore,
taking the average of the range of possible reduction in diarrhoea incidence in develop-
ing countries, the PWS and BWS have the capacity to reduce diarrhoea incidence by
75 per cent and 25 per cent, respectively (see Appendix). With improved water sources,
the estimations show that PWS will reduce diarrhoea incidence by 8.18 cases per house-
hold per year, while the BWS will reduce diarrhoeal incidence by 2.73 cases per household
per year. This implies that PWS is more effective in the reduction of incidence of diarrhoea.

5.2.1.3. Reduction in mortality. The reduction in deaths due to diarrhoea is another

important health benefit of improved water supply. Therefore, if improved water
 Journal of Development Effectiveness 507

supply programme reduces cases of diarrhoea incidence, there will be a reduction in

diarrhoea-related deaths. Using data from WHO (2002, 2008b) report, the diarrhoea case
fatality rate (live lost per case), which is estimated at 0.00084, is used to calculate the
effectiveness measure (reduction in deaths) for PWS and BWS. The analysis shows that
the reduction in mortality from diarrhoea disease per household per year as a result of
PWS and BWS are 0.0069 and 0.0023, respectively.

5.2.2. Cost-effectiveness ratios. The ratio of estimated unit cost of the programmes to the
probable impacts (that is, time savings and health benefits) gives the estimated value of the
potential cost-effectiveness of the programmes.
In theory as well as in practice, the programme with the lowest cost-effectiveness ratio
(CER) is expected to be the programme with the least cost and a reasonable impact on
Downloaded by [University of Otago] at 06:13 30 September 2015

beneficiaries. Overall, the cost-effectiveness result suggests that the BWS programme is
more successful and efficient than the PWS programme. Clearly, on all the two effec-
tiveness measures adopted in this analysis, the results indicate that BWS programme is
more cost-effective than the PWS programme. Table 4 summarises the estimated cost-
effectiveness ratios. Using time savings as the effectiveness measure, the results show that
the CERs for BWS and PWS are NGN2.66 and NGN15.56 per hour saved, respectively.
Similarly, the CER for BWS is NGN1,970,634, while that for PWS is NGN7,688,141 per
health benefit when the effectiveness is based on health benefits. In all, the cost-
effectiveness outcomes indicate a lower CER for the BWS. This implies that the BWS
intervention with smaller unit cost has more impact on households than the PWS inter-
vention. In summary, this suggests that the BWS intervention is more cost-effective than
the PWS.

5.3. Benefit–cost ratio

The ratio of the monetary value of probable impacts (that is, time savings and health bene-
fits) to the estimated unit cost of the programmes gives the estimated value of the potential
benefit–cost ratio of the interventions. Overall, the BCA shows that the BWS programme
is more sustainable and beneficial than the PWS programme. Table 5 presents the estima-
tion of the monetary benefits of PWS and BWS programmes, while Table 6 presents the
estimates of the NPV and BCA ratio for both interventions.
Like the CEA, the BCA results indicate that both programmes are beneficial, although
BWS programme has a higher benefit–cost ratio. Based on the total benefits (time savings
and health benefits), the results presented in Table 6 show that the NPV and the benefit–cost
ratio are NGN66,558 and 15.70 for BWS and NGN64,451 and 2.22 for PWS, respectively.

Table 4. Estimates of cost-effectiveness ratios (CERs) of PWS and BWS interventions.

Estimated cost of CER (time CER (reduction CER (reduction CER (health
Intervention/ intervention/ savings) in diarrhoea) in mortality) benefits)
programme household (NGN) (NGN) (NGN) (NGN) (NGN)

BWS intervention 4529 2.66 1661 1,968,973 1,970,634

PWS intervention 53,005 15.56 6480 7,681,661 7,688,141

Note: CER = Cost/Effectiveness.

 508 E. Uneze et al.

Table 5. Equations for the computation of monetary benefits of PWS and BWS programmes.

Values Values
Effectiveness measures Equations (PWS) (BWS)

Time savings (hours) experienced T1W = T0W − T1W , where 0 is the 1 hour 35 minutes
in period 1 collecting 35 litres per pre-intervention and 10 minutes
day per individual 1 post-intervention period
Value of total time savings: water V ts = T1W × S × 365v(w/8) 87,094 60,965
(NGN per household per year)
Value of avoided morbidity (NGN V morbidity = I × E × S × COI 5819 1940
per household per year)
Value of avoided mortality (NGN V mortality = I × E × S × CFR × VSL 24,544 8181
per household per year)
Total benefits (NGN per household V TB = V morb + V mort + V ts 117,457 71,087
per year)
Downloaded by [University of Otago] at 06:13 30 September 2015

Note: See Table A2 in Appendix for the detailed definition of variables.

Table 6. Estimates of benefit–cost ratios (BCRs) of PWS and BWS interventions.

Total cost (NGN Total benefits (NGN NPV (NGN per

Intervention/programme per household) per household) household) BCRs

BWS intervention 4529 71,087 66,558 15.70

PWS intervention 53,005 117,457 64,451 2.22

Note: BCR = TPVbenefits /TPVcost .

5.4. Sensitivity analysis: cost-effectiveness analysis

The sensitivity analysis of the CEA results presents three different scenarios. First is the
sensitivity to increase in annual total cost of BWS or sensitivity to decrease in annual total
cost of PWS. Second is the sensitivity to decrease in effectiveness of BWS or sensitivity
to increase in effectiveness of PWS. Third is the sensitivity to increase in annual total cost
and decrease in effectiveness of BWS or sensitivity to decrease in annual total cost and
increase in effectiveness of PWS. The three scenarios are presented in Table 7.
Overall, the findings of the sensitivity analysis affirm the superiority of the BWS pro-
gramme. In all the scenarios presented in Table 7, the BWS programme has to be much
worse for the PWS programme to be equally cost-effective. For example, for the PWS to
have equal CER as the BWS, either the annual total cost of BWS will significantly increase
by 485 per cent or the annual total cost of PWS will drastically decrease by 83 per cent.
Similarly, BWS will only present equal CER as PWS, if the effectiveness of BWS decreases
by 83 per cent.

5.5. Summary of sensitivity analysis: benefit–cost analysis

The sensitivity analysis of BCA evaluates the extent to which the variations in parameters
and assumptions affect their relative benefits and the overall stability of the results. A one-
way and multi-way sensitivity analyses are presented and each focuses on two scenarios –
the worse- (lower limit of the parameters) and best-case scenarios (upper limit of the param-
eters) for each interventions. This exercise re-estimates the total cost per household, NPV
and BCR of the BWS and the PWS (see Table A3 in Appendix). The one-way sensitivity
analysis varies only the discount rate, while the multi-way sensitivity analysis examines:
variations in discount rate and effectiveness, variations in discount rate, effectiveness and
 Journal of Development Effectiveness 509

Table 7. One-way and multi-way sensitivity analyses on the CEA results.

BWS PWS
Sensitivity to cost
Increase in cost Decrease in cost
Base 485% Base 83%

Annual total cost (NGN) 4529 26,495 53,005 9064

Time savings 1703 1703 3407 3407
Cost-effectiveness ratio (NGN) 2.66 15.56 15.56 2.66

Sensitivity to effectiveness
Decrease in effectiveness Increase in effectiveness
Downloaded by [University of Otago] at 06:13 30 September 2015

Base 83% Base 0%

Annual total cost (NGN) 4529 4529 53,005 53,005

Time savings 1703 291 3407 3407
Cost-effectiveness ratio (NGN) 2.66 15.55 15.56 15.56

Sensitivity on cost and effectiveness

Increase in cost and Decrease in cost and
decrease in effectiveness increase in effectiveness
Base 200% and 49% Base 83% and 0%

Annual total cost (NGN) 4529 13,587 53,005 9064

Time savings 1703 874 3407 3407
Cost-effectiveness ratio (NGN) 2.66 15.55 15.56 2.66

lifespan and variations in discount rate, effectiveness, lifespan and operations and main-
tenance cost. Overall, the findings affirm the initial results. An increase in the discount
rate from 3 per cent to 5 per cent further increases the total cost per household per year to
NGN63,087 and NGN4840 for the PWS and BWS, respectively. This therefore reduces the
benefit–cost ratio to 1.86 and 14.69, respectively. Further analysis shows that with decrease
in effectiveness to 60 per cent and discount rate to 2 per cent or an increase to 90 per cent
of effectiveness and 5 per cent discount rate for PWS intervention, the BWS intervention
still has a more favourable BCR than the PWS intervention. Also, reversing this scenario,
a decrease to 10 per cent of effectiveness and 2 per cent discount rate or an increase to
40 per cent of effectiveness and 5 per cent discount rate for the BWS intervention still does
make BWS better. Similarly, varying the lifespan of the interventions to 5 years for BWS
and to 15 years for PWS, and both, with the same changes in discount rate and effective-
ness, reduces the BCR. However, this still does not change the preference for BWS. Finally,
the sensitivity analysis of change in percentage of operations and maintenance cost, along-
side with variations in discount rate, lifespan of interventions and effectiveness for either
PWS or BWS, gives a result that is consistent with the previous analysis.

6. Conclusion and policy recommendations

This study has systematically conducted the CEA and BCA of two basic water interven-
tions – BWS and PWS in Nigeria, with focus on Bauchi State. The results of the cost
 510 E. Uneze et al.

analysis show that BWS programme has a lower-cost per household per year, while the
PWS is more effective or has more benefits along the dimensions of time savings and total
health benefits. However, the CER and, in particular, the NPV and the benefit–cost ratio
suggest that both interventions are implementable, although the BWS is more efficient and
beneficial (in monetary terms). This result is in line with the findings by Whittington et al.
(2008). In all, the findings provide answers to the first, second and third research questions
stated in the earlier part of this study.
Several important policy recommendations emerge from this CEA and BCA of these
water programmes: first, in very dense towns, villages or areas where there is high level
of mortality and morbidity arising from diarrhoea, policy-makers and government officials
should consider increasing investment in PWS intervention. Second, in sparsely populated
villages or areas where access to portable water is very low or with few cases of mor-
bidity and mortality from diarrhoea, there is a need to concentrate investment on BWS
Downloaded by [University of Otago] at 06:13 30 September 2015

project. Third, where the objective of government officials and policy-makers is to reduce
the amount of time people spend in collecting water, taking cost into account, investment
should target the BWS scheme. Fourth, there is a need for the federal government, through
the water supply boards in various states and other relevant agencies, to encourage and
support the state and local governments to implement programmes (BWS or PWS) aimed
at increasing access to improved and sustainable water supply. Furthermore, monitoring
and evaluation of programmes should be introduced – households should be examined
regularly for cases of diarrhoea, cholera and other related diseases. This way, it will be
easy to determine whether programmes are being adequately implemented and if there are
improvements that can be associated with such interventions. Finally, there should be an
effective system for collecting and recording cost data in future projects by project man-
agers. The availability of cost data will help to increase the precision and reliability of
estimates from future studies.
It is important to state that this study, like many similar studies, have some limita-
tions. BWS intervention has several dimensions: solar, motorised and hand pump. These
dimensions also have their complications in terms of costing, measuring and isolating
effectiveness and benefits. With this in mind, the analysis focused on hand pump borehole.
This therefore limits the ability of this analysis to generalise. For a more in-depth under-
standing of the usefulness and sustainability of borehole interventions, this study suggests
that additional research should be carried out on the CEA and BCA of solar and motorised
boreholes, and the PWS.

Acknowledgements
The authors thank David Fuente, Charles Griffin and Courtney Tolmie for technical advice and
helpful comments on earlier draft. The article also benefitted from comments of participants at a
technical workshop organised by the Global Development Network (GDN) in Nairobi on July 2011.
The authors acknowledge financial support from the GDN under its PEM project. The authors are
responsible for the remaining errors.

Notes
1. National Technical Working Group on Water and Sanitation (July 2009), Report of the Vision
2020.
2. Based on 1992 exchange rate (1UA = NGN27.48; 1USD = NGN20.00), where UA is AfDB
unit of account.
3. The borehole water supply project is expected to have an average lifespan of 10 years. See, for
example, Whittington et al. (2008) and Adekile and Olabode (2009).
 Journal of Development Effectiveness 511

4. This assumption is an average estimate of the lower and upper limits of the number of bene-
ficiaries per BWS adapted from previous studies. For example, see Whittington et al. (2008);
Whittington and Jeuland (2009); Adekile and Olabode (2009); Eduvie (2008), Ifabiyi (2011)
and AB-Serkoms (2008).
5. For example, there is a report on the Bauchi State pipeline water project by the African
Development Bank, focusing on project execution and accountability of funds.
6. The average operations and maintenance cost, 37.5 per cent, was adapted from Whittington et al.
(2008) and this was based on the upper and lower limit costs of operations and maintenance for
PWS in developing countries, estimated by previous studies.
7. Whittington et al. (2008) presents the global annual operations and maintenance cost and
management cost as US$250–US$950 per year.
8. We take half the time (upper limit) spent on collecting water from existing sources as a new time
for collecting water from the BWS. For the PWS, zero (0) time will now be spent by household
collecting water since they now have direct access to water in their houses.
9. WHO (2002) reported annual incidence/case of diarrhoea in Africa as 838,857,000, death
per total case as 707,657 and annual death per total case for Nigeria as 173,900. Using this
Downloaded by [University of Otago] at 06:13 30 September 2015

information, this article was able to derive annual diarrhoea incidence/case for Nigeria.

References
AB-Serkoms, 2008. Technical and financial proposal for Likpe Abrani small town water supply
project. Kumasi, Republic of Ghana.
Adekile, D. and Olabode, O., 2009. Study of public and private borehole drilling in Nigeria.
UNICEF, Nigeria. Available from: http://www.rwsn.ch/documentation/skatdocumentation.2009-
11-16.3173940374 [Accessed 17 April 2011].
African Development Bank Group, 2000. Nigeria Bauchi township water supply project. Project
Performance Evaluation Report (PPER), African Development Bank.
Clasen, T., et al., 2006. Interventions to improve water quality for preventing diarrhoea. Cochrane
Database of Systematic Reviews, 3, CD004794. DOI: 10.1002/14651858.CD004794.pub.
Clasen, T., et al., 2007. Cost-effectiveness of water quality interventions for preventing diarrhea
disease in developing countries. Journal of water and health, 5 (4), 599–608.
Eduvie, M.O., 2008. Approaches to cost effective borehole drilling. Kaduna: National Water
Resources Institute. Kaduna: Nigeria.
Haller, L., Hutton, G., and Bartram, J., 2007. Estimating the costs and health benefits of water and
sanitation improvement at global. Journal of water and health, 5 (4), 467–478.
ICF International, 2009. Final report sub-Saharan Africa refinery project: volume 1-a health study.
Final report prepared for The World Bank and African Refiners Association. Available from:
http://siteresources.worldbank.org/INTOGMC/Resources/ssa_health_study_vol_1.pdf [Acces-
sed 17 April 2011].
Ifabiyi, I.P., 2011. Spatial distribution of performance of water pumps in the rural areas of Kaduna
state, Nigeria; before the second republic. European journal of social sciences, 25 (3), 15–25.
ILRI and World Bank, 2010. Nigeria Integrated Animal and Human Health Management Project.
Nigeria: Abuja.
National Bureau of Statistics, 2009. Annual abstract of statistics. Nigeria: Abuja.
Rosen, S. and Jeffrey, R., 1999. Household water resources and rural productivity in
sub-Saharan Africa: a review of the evidence. Cambridge, MA: Harvard Institute
for International Development. Available from: http://www.cid.harvard.edu/archive/events/
cidneudc/papers/rosenvincent.pdf [Accessed 15 May 2011].
Whittington, D., et al., 2008. The challenge of improving water and sanitation services in less
developed countries. Foundation and trends in microeconomics, 4 (6–7), 469–609.
Whittington, D. and Jeuland, M., 2009. Cost-benefits comparisons of investments in improved water
supply and cholera vaccination programmes. Vaccine, 27, 3109–3120.
World Health Organization, 2002. Revised global burden of disease estimates. Available from:
http://www.who.int/healthinfo/global_burden_disease/estimates_2000_2002/en/index.html
[Accessed 17 April 2011].
World Health Organization, 2008a. Protecting health from climate change – World Health Day.
Geneva, Switzerland. Available from: http://www.who.int/world-health-day/toolkit/report_web.
pdf [Accessed 10 March 2011].
 512 E. Uneze et al.

World Health Organization, 2008b. Revised global burden of disease estimates. Available
from: http://www.who.int/healthinfo/global_burden_disease/estimates_country/en/index.html
[Accessed 17 April 2011].
WHO and UNICEF, 2010. Meeting the MDG drinking water and sanitation target: the urban
and rural challenge of the decade. Available from: http://www.who.int/water_sanitation_health/
monitoring/jmpfinal.pdf
WHO, 2008. Protecting health from climate change – World Health Day. Geneva: Switzerland.
Available from: http://www.who.int/world-health-day/toolkit/report_web.pdf [Accessed
10 March 2011].

Appendix

Table A1. Cost of a 110 mm UPVC-lined hand pump borehole 50 m deep.

Downloaded by [University of Otago] at 06:13 30 September 2015

Unit rate Amount

Description Unit Quantity (US) (US$)

Mobilisations/de-mobilisation Ls 1 2101 2101

Drilling: site clearing and preparation 1 35 35
Drilling (fuel and lubricants cost $10 per hour) m 50 46 2254
Casing and completion: 110 UPVC casing m 40 22 878
110 UPVC screen m 10 24 235
Supply sand pack river gravel No 1 209 209
Backfill Ls 1 70 70
Grouting (six bags of cement) No 6 23 139
Development and pumping
Borehole development (compressor running for 10 hours) No 4 70 278
Pumping test (pump and generator running for 24 hours) No 3 208 624
Subtotal 6823
Other costs 2927
Total cost 9750

Source: Computed based on Adekile and Olabode (2009) estimates.

Table A2. Definition of parameters used in cost-effectiveness and benefit–cost analyses.

Average/base Average/base
Symbols Parameters description (PWS) (BWS)

C PWS/BWS Total capital cost of interventionsa,b NGN1,354,764,000 NGN1,156,027.26

PO&M Operations and maintenance (O&M) 37.5 –
expenditure, as per cent of annualised
capital (%)c
o&m
C Annualised O&M and management costsc,d NGN34,148,028.97 $600/NGN71,414
D Duration of network (years)c 20 10
R Real (net of inflation) discount rate (%)c 3 3
S Household size (person/Hh)e 8 8
K Number of individual served by 400,000 356
PWS/BWSb,c
N Number of household served by PWS/hand 50,000 45.625
pump BWSd
T0W Collection time from traditional water 0.67 0.67
source in period 0 (hours/jerrican)b
T1W Collection time from improved water supply 0 0.33
in period 1 (hours/jerrican)b

(Continued)
 Journal of Development Effectiveness 513

Table A2. (Continued)

Average/base Average/base
Symbols Parameters description (PWS) (BWS)

Qw Water use when collection time is 106 80

T1W = 0 (litre per person per day)d
I Diarrhoea disease incidence 0.060905 0.060905
(cases/household year)e
E Per cent reduction in diarrhoea incidence 75 25
due to water supply improvementb
W Market wage for unskilled labour 10,000 10,000
(NGN/per day)c
V Value of time saving as a percentage of 30 15
market wage for unskilled labour %b
COI Cost of illness from diarrhoea (NGN/case)f 1305.5 1305.4
Downloaded by [University of Otago] at 06:13 30 September 2015

VSL Value of statistical life (NGN/life lost)g 6,153,622.11 6,153,622.11

CFR Diarrhoea case fatality rate (lives lost/case)e 0.0008436 0.0008436
CR Capital recovery factord 0.06721 0.1172

Sources: a Adekile and Olabode (2009); b Bauchi State Government; c Whittington et al. (2008) and Whittington
and Jeuland (2009); d Authors’ estimate; e WHO, Global Burden of Disease (GBD) 2002 and 2008a; National
Bureau of Statistics (2009); f ILRI and World Bank (2010); g ICF International (2009).

Table A3. One-way and multi-way sensitivity analyses on the BCA results.

PWS BWS
Sensitivity on discount rate
One-way Base case Decrease Increase Base case Decrease Increase

Discount rate (%) 3 2 5 3 2 5

Annual total cost 53,005.36 48,229.89 63,086.84 4528.80 4380.07 4840.45
(NGN)
Value of time savings 87,093.56 87,093.56 87,093.56 60,965.49 60,965.49 60,965.49
(NGN)
Value of avoided 5818.94 5818.94 5818.94 1939.65 1939.65 1939.65
morbidity (NGN)
Value of avoided 24,544.22 24,544.22 24,544.22 8181.41 8181.41 8181.41
mortality (NGN)
Annual total benefits 117,456.72 117,456.72 117,456.72 71,086.55 71,086.55 71,086.55
(NGN)
Net present value 64,451.37 69,226.83 54,369.88 66,557.75 66,706.48 55,246.09
(NGN)
Benefit–cost ratio 2.22 2.44 1.86 15.70 16.23 14.69

Sensitivity on effectiveness and discount rate

Multi-way Base case Decrease Increase Base case Decrease Increase

Effectiveness of 75 60 90 25 10 40
intervention (%)
Annual total cost 53,005.36 48,229.89 63,086.84 4528.80 4380.07 4840.45
(NGN)
Value of time savings 87,093.56 87,093.56 87,093.56 60,965.49 60,965.49 60,965.49
(NGN)

(Continued)
 514 E. Uneze et al.

Table A3. (Continued)

Sensitivity on effectiveness and discount rate

Multi-way Base case Decrease Increase Base case Decrease Increase

Value of avoided 5818.94 4655.15 6982.72 1939.65 775.86 3103.43

morbidity (NGN)
Value of avoided 24,544.22 19,635.38 29,453.07 8181.41 3272.56 13,090.25
mortality (NGN)
Annual total benefits 117,456.72 111,384.09 123,529.35 71,086.55 65,013.91 77,159.18
(NGN)
Net present value 64,451.37 63,154.20 60,442.51 66,557.75 60,633.85 72,318.73
(NGN)
Benefit–cost ratio 2.22 2.31 1.96 15.70 14.84 15.94

Sensitivity on lifespan, discount rate and effectiveness

Downloaded by [University of Otago] at 06:13 30 September 2015

Multi-way Base case Decrease Increase Base case Decrease Increase

Lifespan of 20 15 25 10 5 15
intervention (years)
Annual total cost 53,005.36 61,375.61 55,989.57 4528.80 6935.87 3999.25
(NGN)
Value of time savings 87,093.56 87,093.56 87,093.56 60,965.49 60,965.49 60,965.49
(NGN)
Value of avoided 5818.94 4655.15 6982.72 1939.65 775.86 3103.43
morbidity (NGN)
Value of avoided 24,544.22 19,635.38 29,453.07 8181.41 3272.56 13,090.25
mortality (NGN)
Annual total benefits 117,456.72 111,384.09 123,529.35 71,086.55 65,013.91 77,159.18
(NGN)
Net present value 64,451.37 50,008.48 67,539.78 66,557.75 58,078.04 73,159.93
(NGN)
Benefit–cost ratio 2.22 1.81 2.21 15.70 9.37 19.29

Sensitivity on percentage of O&M, discount rate, lifespan and effectiveness

Multi-way Base case Decrease Increase Base case Decrease Increase

Percentage of O&M 37.50% 25% 50% $600 $250 $950

Annual total cost 53,005.36 55,774.59 61,079.59 4528.80 6026.32 4908.80
(NGN)
Value of time savings 87,093.56 87,093.56 87,093.56 60,965.49 60,965.49 60,965.49
(NGN)
Value of avoided 5818.94 4655.15 6982.72 1939.65 775.86 3103.43
morbidity (NGN)
Value of avoided 24,544.22 19,635.38 29,453.07 8181.41 3272.56 13,090.25
mortality (NGN)
Annual total benefits 117,456.72 111,384.09 123,529.35 71,086.55 65,013.91 77,159.18
(NGN)
Net present value 64,451.37 55,609.50 62,449.79 66,557.75 58,987.59 72,250.38
(NGN)
Benefit–cost ratio 2.22 2.00 2.02 15.70 10.79 15.72