Cost – Benefit analysis of water supply: A case study of Ghana water company limited Ashanti-Region
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Date
2008-08-05
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Abstract
The effect of recent water crisis in and around the cities and regional capitals of Ghana is a great concern. It hindered proper economic growth and put much pressure and stress on workers, women and school children.
This research meant to look at the costs and benefits associated with improved water supply to the communities by the water company. Ghana Water Company Limited (GWCL)–Ashanti region was used as a case study.
Cost –Benefit Analysis (CBA) is performed on monthly costs and benefits (revenue) from January, 2006 to December, 2007 from GWCL- Ashanti. It used Government of Ghana 91-day Treasury bill rate of 11.27 % (Bank of Ghana) as the discount rate for the analysis.
The analysis indicated clearly that, the operation of GWCL is economically viable. The Benefit- Cost Ratio (BCR) gives the value of 1.3466 which is greater than one, the Net Present Value (NPV) is GH¢4,304,701.50 and that is greater than zero. The Internal Rate of Return (IRR) also gives the value of 27% which is also greater than the discount rate of 11.27%.
All these clearly show that, the benefits the communities derived from having water supply improved are by far more than the costs incurred. These benefits amount to time saving, less illness, increases productivities at the workplaces, increase in school attendance rates.
Description
A thesis presented to the Department of materials Engineering, Kwame Nkrumah University of Science and Technology in partial fulfilment of the requirements for the Degree of Master of Science