THE REAL COST PER DROP – HOW OPEX DEFINES EQUITY

Author : AM Tris Hardyanto

THE REAL COST PER DROP – HOW OPEX DEFINES EQUITY

Series: The Hidden Cost of Water: Rethinking CapEx and OpEx in a Thirsty World (Article 2 of 5)

 

1. Introduction

Every drop of clean water delivered to a household carries a cost far beyond its physical form. Operational Expenditure (OpEx) — the often-invisible force that keeps water systems running day after day — plays a critical role in determining who gets consistent access and who is left behind. This article examines how chronic underfunding of operational expenses (OpEx) widens water inequality and why sustainable access to water cannot be achieved without financing the ongoing costs of service.

Access to clean water remains a critical global challenge, intimately tied to operational expenditures (OpEx) that define equitable water distribution and accessibility. The costs associated with maintaining water supply systems often extend beyond initial capital investments (CapEx), highlighting a disconnect that exacerbates existing inequalities. This situation is further compounded by the chronic underfunding of operational expenses (OpEx), which hinders the consistent provision of clean water to vulnerable populations. As a result, merely providing clean water infrastructure is insufficient; sustaining operations through adequate funding is essential for ensuring equitable access.

A significant body of literature emphasises that clean water is not just a basic necessity but a fundamental human right. Studies have shown that access to clean water is directly correlated with public health outcomes, particularly in children's health. For instance, children who lack reliable access to clean water experience higher rates of dehydration and malnutrition, as clean water is essential for various aspects of human metabolism and nutritional uptake (Hussain et al., 2024; Miller et al., 2021). Investigations into community water systems reveal that when operational expenses (OpEx) are not sufficiently prioritised, poorer segments of society continue to suffer disproportionately from water scarcity, leading to severe public health crises (Mangai & Vries, 2018; Muazzinah et al., 2020; Arcipowski et al., 2017).

Moreover, the intricacies of financing operating expenses (OpEx) are crucial in the context of global water scarcity. While capital expenditures (CapEx) investments are often clearly articulated in development projects, continuous financial support for operations is frequently neglected. This neglect results in inadequate maintenance of water facilities, leading to breakdowns and service interruptions that primarily affect marginalised groups. The Sustainable Development Goals (SDGS) recognise this disconnect; they emphasise that to achieve equitable access to clean water and sanitation, collaborative management approaches that highlight community involvement and sustainable funding models are necessary (Yehia & Said, 2024; Kishore et al., 2023).

Empirical evidence suggests that countries with robust operational plans and community engagement see better outcomes in clean water distribution (Karmilah & Madrah, 2024; Setyari et al., 2022). Partnerships between civil society organisations and governmental bodies can create pressure for sustainable funding models that support consistent water service operations. Successful case studies from various regions demonstrate how community participation in water management leads to improved resource allocation and increased transparency (Nugroho et al., 2024; Basri et al., 2023; Gration et al., 2023). Therefore, it becomes evident that funding OpEx must be viewed as a foundational investment, critical to breaking the cycles of poverty and inequity linked to water access.

The nexus of clean water, energy, and operational costs further complicates the pursuit of equitable access. As highlighted in recent studies, the transition to alternative water supply methods, such as desalination and rainwater harvesting, often entails significant operational costs (O'Connell et al., 2024; Linares et al., 2016; Shemer et al., 2023). Innovations that might reduce these costs or enhance water quality intersect directly with notions of equity. Communities that secure financing for such technologies often find themselves better equipped to sustain clean water access, thereby improving their overall socioeconomic conditions (Russell et al., 2024; Arndt et al., 2024; Whitford et al., 2010).

Additionally, the role of local knowledge and community-based strategies in addressing water scarcity cannot be overstated. Leveraging local insights aids in identifying specific community needs and fosters a sense of ownership, which is crucial for the longevity and effectiveness of clean water projects (Karmilah & Madrah, 2024; Edwin, 2022). Instances where community members take the helm of water management frequently result in improved service delivery due to localised decision-making processes, which are more responsive to the unique challenges faced by different demographics (Mangai & Vries, 2018; Rahmawati & Firman, 2022).

The socioeconomic implications related to the operational expenses (OpEx) of water supply systems also reveal stark disparities. Marginalised neighbourhoods often resort to using contaminated water sources when municipal supplies are disrupted or unreliable, exposing themselves to preventable diseases (Saylan et al., 2019; Gulumbe et al., 2023). A study detailing the water infrastructure in urban Bangladesh revealed a correlation between household poverty levels and access to clean water, indicating that addressing the underlying socioeconomic issues is crucial for prioritising operational expenditures (Hossain et al., 2023).

In rural areas, particularly, infrastructure improvements coupled with sufficient operational expenditures (OpEx) allocations tend to yield significant health benefits and boost local economies (Nathasya et al., 2022). For instance, poorly maintained water infrastructure compromises public health, resulting in unnecessary expenditures on healthcare that could have been allocated for productive investments (Onditi, 2024; Árvai & Post, 2011). Moreover, incentivising local governance structures to manage water supplies effectively has yielded significant results in improving access to and the quality of water (Muazzinah et al., 2020; Abedin et al., 2021).

Ultimately, the pursuit of water equity cannot overlook the necessity of sustained operational expenditures. Without a balanced focus on both capital expenditures (CapEx) and operating expenditures (OpEx), efforts to provide universal access to clean water will falter, perpetuating cycles of inequality. Therefore, stakeholders must advocate for comprehensive funding strategies that prioritise OpEx as a core pillar in water service provision (Riaz et al., 2014; Kaleeswari et al., 2023). Only through a collaborative approach that includes investment in operational sustainability alongside infrastructural development can the global community hope to bridge the gap in water access and deliver on the promise of health and dignity for all.

 

2 OpEx: The Backbone of Service Equity

While CapEx brings infrastructure into existence, OpEx ensures its daily function. It pays the technicians who maintain pumps, the fuel and energy required to keep systems running, the chemicals to purify water, and the logistics to deliver it. However, in many systems around the world, OpEx is treated as an afterthought — or worse, an avoidable cost.

Chronic Underfunding of OpEx: The Silent Saboteur of Infrastructure

The failure to prioritise operational expenditure (OpEx) is a systemic flaw that turns ambitious infrastructure projects into dysfunctional relics. When governments and utilities focus on capital expenditure (CapEx) alone—constructing pipelines, treatment plants, and distribution networks—without ensuring long-term funding for operation and maintenance, systems quickly degrade:

• Pump failures become routine due to neglected repairs.
• Water treatment inconsistencies lead to unsafe drinking conditions.
• Workforce shortages mean communities endure service disruptions simply because technicians and support staff are not paid or trained adequately.

The result? What seemed like transformative projects morph into unreliable "white elephants" that cannot sustain consistent service.

Two-Tiered Service Inequality: The Hidden Divide in Water Access

When OpEx falls short, a stark divide emerges between well-resourced urban districts, which receive continuous service, and marginalised or rural areas, which face intermittent supply or shutdowns. This disparity is driven by unequal OpEx allocation:

• High-income zones benefit from stable budgets that ensure consistent service.
• Poorer districts are forced into intermittent access, with water available for only a few hours or days per week.
• Private alternatives—water tankers and bottled water—have become essential survival tools for poorer households, but at a significantly higher price per litre.

This cruel irony means those least able to afford premium rates end up paying disproportionately more for water than the wealthy.

Understanding the interplay between operational expenditures (OpEx) and service equity in water supply systems is crucial for ensuring sustainable access to clean water. Operational expenditures play a vital role in maintaining the efficacy of water services, encompassing the costs associated with workforce compensation, equipment repair, treatment chemicals, and logistical operations necessary for water distribution. The preoccupation with capital expenditures (CapEx), which focuses primarily on infrastructure development, often occurs at the expense of operating expenditures (OpEx). This disjuncture can have dire consequences for service delivery, disproportionately hindering marginalised communities that rely on consistent access to clean water for their health and well-being.

When governments and utilities prioritise CapEx without embedding sustainable OpEx funding into their frameworks, they unwittingly set the stage for chronic underfunding of essential services. The failure to allocate adequate resources for daily operations can transform promising infrastructure projects into ineffective "white elephants," characterised by unreliable service and deteriorating facilities. Regulatory oversight must adapt to ensure that operational costs are accounted for from the outset of project planning. Specifically, reports indicate that a lack of consistent funding can lead to frequent pump failures and interruptions in water supply, while insufficient workforce investment results in chronic understaffing and inadequate technician training (Hussain et al., 2024; Miller et al., 2021; Mangai & Vries, 2018). This systemic flaw is illustrated in many regions worldwide, where water systems are plagued by mechanical failures and untreated water supplies, highlighting the importance of a holistic approach to infrastructural investments that includes sustained operational funding (Muazzinah et al., 2020; Arcipowski et al., 2017).

The resulting inequities from a neglectful approach to OpEx manifest starkly within two distinct tiers of service delivery. In high-income urban districts, stable budgets enable continuous access to water services, ensuring residents enjoy consistent quality and availability. In contrast, poorer or rural areas often face intermittent supply issues, with households experiencing unreliable access, sometimes receiving water for only a few hours each week. This inconsistency fuels a reliance on expensive alternatives such as bottled water and private water tankers, which paradoxically places a heavier financial burden on poorer households who can least afford it. Available data indicate that in urban areas across Africa, households in wealthier districts utilise centralised water services, while economically disadvantaged families are compelled to seek more costly sources, thereby exacerbating the socioeconomic divide (Yehia & Said, 2024; Kishore et al., 2023; Karmilah & Madrah, 2024).

Moreover, an inherent irony exists within the water access ecosystem, wherein those least equipped to absorb additional financial burdens often bear the highest costs for lower-quality resources. Households in marginalised communities frequently experience a coerced reliance on private vendors due to inadequate infrastructure or service provisions from state-run utilities (Setyari et al., 2022; Nugroho et al., 2024). This paradox exacerbates health disparities and cultivates an environment of chronic inequity, wherein families expend a disproportionate share of their income on water. Research reveals that low-income families often allocate a significantly higher percentage of their total income to water costs compared to wealthier counterparts, further entrenching cycles of poverty and limiting the financial flexibility necessary for investing in health or education (Basri et al., 2023).

The need for comprehensive planning that interlinks capital and operational expenditures, therefore, becomes evident. This integrated approach requires acknowledging OpEx as not merely an ancillary expense but rather a foundational pillar that sustains the operational integrity of any water system. Subsequently, diverse funding mechanisms, such as escalated local government support or innovative community financing models, need to be activated to bolster OpEx sustainability (Gration et al., 2023; O'Connell et al., 2024; Linares et al., 2016). Reports from various countries indicate that when communities play an active role in decision-making regarding the management and funding of water services, improvements in both access and quality are often achieved (Shemer et al., 2023; Russell et al., 2024).

Furthermore, implementing regular monitoring frameworks to assess the performance of water utilities can help illuminate disparities and inefficiencies, ensuring that funds are used judiciously and directed appropriately based on need (Arndt et al., 2024; Whitford et al., 2010). Continued failure to address these issues will perpetuate inconsistent access and service quality, hampering public health initiatives aimed at reducing waterborne diseases that disproportionately impact vulnerable populations (Edwin, 2022; Rahmawati & Firman, 2022). Thus, it is evident that operational expenditures must be recognised as a critical driver of equity, influencing the very fabric of accessibility across sociopolitical strata.

In conclusion, resolving disparities in water access requires a dual focus on both capital expenditure for infrastructural development and operational expenditures for sustainable service delivery. Recognising and prioritising OpEx not only sustains technological investments but ultimately transforms water infrastructure into a catalyst for social equity. Policymakers must champion mixed funding strategies and community involvement to create cognitive alignments that elevate OpEx to its rightful place within the paradigm of modern water service provision. The future of equitable water access hinges on acknowledging that operational costs are not an afterthought, but rather the backbone of robust, sustainable infrastructure that can withstand the pressures of demand and climate variability.

 

3 The Inequity of Intermittent Access

A pipe in the ground does not mean water at the tap. In many cities, water is only available for a limited number of hours a day or a few days a week. This intermittent access is often worse in low-income or peri-urban areas, where operational expenditure (OpEx) allocation is minimal. Residents are forced to rely on expensive alternatives, such as private tankers, bottled water, or unsafe sources of water. In effect, the poor pay more per litre than the rich.

Hidden Costs Burdening the Poor: The "Poverty Premium" in Water Access

When utility-operated water systems fail, vulnerable households must find alternatives—many of which come at staggering costs, both financial and health-related:

Coping Mechanism	Impact on Households
Private water tankers	Exorbitant rates exploit scarcity.
Bottled water	A daily necessity, but it remains unaffordable for many.
Unsafe sources (wells, rivers)	High risk of contamination and waterborne diseases

This "poverty premium" forces struggling communities into an endless cycle where the financial burden of securing clean water deepens economic hardships.

Intermittent access to water—a situation where water supply is not available 24/7—poses significant challenges across urban landscapes, particularly in low-income and peri-urban communities. The discrepancy between having physical infrastructure and actual access to water creates critical barriers for millions worldwide, leaving them reliant on expensive alternatives. In cities where intermittent supply is standard, inhabitants find themselves subjected to a "poverty premium," whereby the more they struggle to obtain clean water, the more they end up paying per litre, exacerbating their financial hardships and health risks.

The economic implications of intermittent water supply systems are profound. Residents in areas experiencing chronic water supply failures are often forced to rely on private water tankers, which charge exorbitant prices. For instance, studies indicate that the costs associated with using water tanks can easily triple the average household expenditure on water compared to those with continuous access (Galaitsi et al., 2016; Ben et al., 2019). This service model not only exploits existing scarcities but also creates a sense of dependency that entrenches poverty. The dilemma further intensifies for families who, when forced to rely on unsafe sources such as wells or stagnant rivers, risk exposure to waterborne diseases that threaten their health and economic stability (Victor et al., 2022; García‐López et al., 2023).

Current literature identifies the detrimental health impacts associated with intermittent water supply systems. The reliance on unsafe water sources contributes to heightened exposure to waterborne pathogens, thereby increasing the incidence of gastrointestinal illnesses, particularly among vulnerable populations such as children and the elderly (Galaitsi et al., 2016; García-López et al., 2023). As these communities grapple with health issues, the associated medical costs often exacerbate their financial situations, compelling them into a vicious cycle where poor health leads to decreased income and ultimately hinders their ability to secure safe water (García-López et al., 2023). The interplay between economic strain and health fragility highlights the crucial role of equitable water access in determining overall community resilience.

Moreover, intermittent access amplifies the inequalities that exist between affluent and impoverished neighbourhoods. Areas with sustained water supply benefit disproportionately from low rates and consistent quality, enabling residents to maintain better hygiene practices and alleviate health risks associated with unsanitary conditions. In contrast, low-income communities with intermittent access face systemic barriers that extend beyond water availability, encompassing broader social and infrastructural disparities (Adams & Smiley, 2018; Lieb et al., 2016). For example, urban studies suggest that wealthier neighbourhoods tend to receive prioritised public investment, leading to fortified infrastructure and service reliability that poorer zones lack (Klassert, 2023; Thomas et al., 2024).

The concept of "water use inequality" becomes particularly salient when considering access patterns across different socioeconomic strata. Recent research emphasises the correlation between intermittent water supply and social inequity, with poorer neighbourhoods growing increasingly reliant on expensive and less reliable water sources (Bayu et al., 2020). Furthermore, policies and governance structures often fail to address these disparities directly, leaving marginalised communities trapped in cycles of dependency on costly alternatives while those in affluent zones continue to enjoy uninterrupted access (Yang et al., 2013; Yu et al., 2014). This dynamic perpetuates existing inequalities, translating to broader societal ramifications that hinder social cohesion and economic mobility.

Ultimately, the need for a comprehensive approach to address these disparities is evident. Sustainable urban water governance must prioritise equitable access to resources through policy reforms that include targeted investments in infrastructure within underserved communities. Additionally, integrating community-driven management systems can offer mechanisms for accountability and responsive service provision tailored to local needs, potentially alleviating the inequities arising from intermittent access (Ben et al., 2019; Yang et al., 2013; García‐López et al., 2023). Urban planners and water governance officials must recognise and act on the intertwined nature of water access, equity, and health outcomes to create a framework where access to safe, reliable water is truly a universal right, rather than a privilege based on socioeconomic status.

 

4 Global Patterns of OpEx Disparity

In Latin America, small municipal utilities in remote areas often lack the financial or technical capacity to cover their operating expenses (OpEx). In East Africa, donor-funded projects often collapse within a year due to budget shortages for fuel or staff. Even in high-income countries, austerity policies have led to shrinking maintenance budgets, disproportionately affecting low-income or Indigenous communities.

Failure of One-Off Capital Grants: Why Short-Term Investments Do not Solve Long-Term Problems

International donors and government programs often inject large sums into capital expenditures—building treatment plants and expanding pipelines—but neglect to provide ongoing Operational Expenditures funding. Its leads to:

• Infrastructure collapse within months or years as maintenance funds run dry.
• Abandoned projects, once celebrated as milestones, are now nonfunctional.
• Wasted investments as entire systems shut down due to the absence of operational budgets.

The solution? A paradigm shift toward multi-year, performance-based funding that guarantees continuous service rather than one-time infrastructure injections.

The operational expenditure (OpEx) landscape reveals pronounced disparities globally, which have a profound impact on water service provision in both economically advanced and developing regions. In Latin America, for instance, small municipal utilities often operate on limited budgets, struggling to cover ongoing operational costs necessary for maintenance and service delivery. This situation culminates in insufficient water quality and availability, disproportionately affecting remote communities that lack both the financial and technical resources to sustain effective water management systems. This disparity illustrates a broader trend where utility maintenance is underfunded, resulting in poor service delivery, equipment failures, and health risks borne by these communities (Rückert & Labonté, 2014; Córdoba-Doña et al., 2018).

Similar patterns emerge in East Africa, where donor-dependent water projects face significant operational challenges. Numerous initiatives, often celebrated upon completion, frequently collapse within a year due to a lack of allocated funds for necessary operational expenses, such as fuel and staffing (Hastings et al., 2015; Hastings et al., 2017). Analysis reveals that infrastructure can collapse soon after commissioning if the appropriate budgets for ongoing maintenance are neglected. This reality emphasises how reliance on sporadic funding for infrastructure, without sustained operational expenses (OpEx), can hinder the long-term sustainability and reliability of water services, ultimately undermining the intended benefits (Fauconnier, 2012).

Moreover, austerity measures in high-income countries reveal a troubling paradox: even in wealthier nations, budget cuts often disproportionately affect low-income and marginalised populations. As national and local governments implement austerity policies, the maintenance budgets for public services dwindle, weakening the infrastructure in already vulnerable communities. Studies indicate that public service reductions often lead to a concentration of resource scarcity among those who rely on these services the most, resulting in lower service quality and access problems for those already disadvantaged (Irving, 2020; Hastings et al., 2017). This further entrenches societal inequities by perpetuating a cycle where the most impoverished face the most significant barriers to obtaining vital services like water.

Another critical aspect of this issue is the failure of one-time capital grants to address persistent operational problems effectively. While international donors and government bodies frequently inject substantial amounts into capital expenditures (CapEx), such as constructing treatment plants and expanding pipelines, they often overlook the long-term operational expenditures (OpEx) funding necessary for effective system operation. As a result, infrastructure funded through these grants frequently falls into disrepair, leading to the collapse of what were once celebrated public works projects within just months or years of their inauguration (Hamer, 2023; Fauconnier, 2012). Abandoned projects litter the landscape, representing wasted investments that fail to provide the anticipated benefits due to the absence of operational budgets. This pattern reflects a fundamental misunderstanding of the need for sustainable financial planning, which includes both initialisation costs and continued operational support vital for maintaining infrastructure longevity (Stehlin & Payne, 2022).

The proposed solution lies in a paradigm shift toward multi-year, performance-based funding mechanisms that prioritise continuous service provision over one-time infrastructure investments. Such funding models would emphasise the importance of sustaining operations through targeted investments in maintenance and infrastructure repair, with clear performance indicators to ensure accountability and efficiency in service delivery (Parker et al., 2021). By adopting a more integrated approach that combines both CapEx and OpEx support, governments and international organisations can develop a more resilient and equitable water supply system that prioritises the needs of underserved communities (Tsiakalakis et al., 2021; Osman & Faust, 2021).

Overall, the disparity in OpEx allocation highlights the urgent need to redefine water governance frameworks that prioritise sustainable operational funding alongside infrastructure investments. A paradigm shift towards long-term, reliable funding models tailored to the unique needs of both urban and rural populations will be crucial for addressing the profound inequities currently existing in water access. By ensuring that operational costs are recognised and funded appropriately, stakeholders can begin to dismantle the barriers that currently perpetuate water inequity, fostering an environment where clean water access becomes a universally enjoyed right rather than a privilege determined by socioeconomic class.

 

5 Toward Equitable Water Economics

Accurate equity in water access requires rethinking how operating expenses (OpEx) are valued and allocated. Utility governance models must ensure that tariff structures are fair and that subsidies are effectively distributed to those in need. International funding must move beyond one-off capital grants to include long-term operational support. Performance-based budgeting and real-time cost tracking can also help redirect funds to where they are needed most.

Models for Equitable OpEx Financing: Sustainable Solutions for Closing the Gap

The path to equitable water access lies in more intelligent operational expenditure (OpEx) allocation. Effective governance strategies include:

• Cross-subsidy tariffs — Wealthier users pay slightly more to subsidise lower-income households.
• Targeted subsidies — Government assistance ensures vulnerable populations receive affordable water.
• Mobile maintenance units — Cost-effective teams deployed to underserved areas for rapid repairs.
• Real-time cost tracking — Data-driven resource allocation optimises spending and prevents service disruptions (as successfully implemented in Kampala, Uganda).

These models offer immediate, scalable solutions that can be adopted to ensure every community receives fair, consistent water access.

Achieving equitable access to water necessitates a profound reevaluation of how operational expenditures (OpEx) are valued and allocated within water governance frameworks. It is essential to adopt governance models that not only ensure fair tariff structures but also guarantee that subsidies reach vulnerable populations effectively. As international funding bodies increasingly recognise the limited effectiveness of sporadic one-time capital grants, it becomes vital to integrate long-term operational support into funding strategies. A shift towards performance-based budgeting and real-time cost tracking will allow for the effective redistribution of funds toward communities and areas most in need of support.

One promising model for equitable water economics involves implementing cross-subsidy tariffs, where wealthier users pay slightly higher rates to subsidise lower-income households. Such a model fosters inclusivity and ensures that financial burdens do not disproportionately affect those who cannot afford exorbitant prices for water access. Similarly, targeted subsidies provided by governments and non-profit organisations can help to ensure that vulnerable populations receive affordable water, improving overall public health and economic stability in marginalised communities (Tantoh et al., 2018). These subsidy structures create a more balanced economic landscape, where those with greater means contribute to a system that supports all users equitably.

Moreover, the establishment of mobile maintenance units can be instrumental in allocating resources efficiently to underserved areas. These teams would be deployed to conduct rapid repairs, thereby preventing service interruptions that disproportionately affect lower-income neighbourhoods. This proactive maintenance strategy not only extends the lifespan of existing infrastructure but also enhances service reliability for those who rely on these resources (Rahman, 2012). Such a model of service delivery can significantly decrease the operational burden on water providers while improving customer satisfaction and health outcomes.

Real-time cost tracking is another vital component of this equitable water economics framework. By employing data-driven resource allocation models, utilities can optimise spending and ensure that funds are directed towards the areas of highest need. A successful implementation of this approach demonstrated that timely data analysis allowed for more informed decision-making regarding maintenance schedules and funding allocations, ultimately resulting in improved service delivery (Liu et al., 2024). Such tools empower utility managers to respond dynamically to service disruptions and operational challenges, fostering resilience within water systems.

Beyond these foundational strategies, broader considerations regarding integrated water resource management (IWRM) must be applied. This holistic approach facilitates the coordinated use and management of water, land, and related resources to maximise economic and social welfare while promoting sustainability. IWRM encourages engagement from all stakeholders, ensuring that the voices of marginalised communities are included in decision-making processes regarding water access and governance (Solarek & Kubasińska, 2022). By fostering collaboration among communities, governments, and NGOS, initiatives can be tailored to local contexts, reflecting the distinct needs and circumstances of various populations.

Furthermore, the role of economic instruments in water governance should not be overlooked. Policies that promote conservation and ensure efficient resource usage through economic incentives can help to alleviate pressure on water resources, ultimately leading to more sustainable practices. For example, when urban water pricing structures are designed to reflect the actual cost of water, including its ecological value, consumers are incentivised to conserve and use water more judiciously (Grafton et al., 2023).

A critical aspect of equitable water economics involves addressing the socio-political inequalities that underpin access to water resources. By recognising the structural barriers that marginalised communities face, effective governance can work to dismantle existing inequalities. Research indicates that equitable water governance is crucial for social stability and economic development; therefore, implementing policies that reflect and address these disparities is essential (Sun et al., 2015; Xie et al., 2023; Pearson et al., 2021).

To transition towards a system where equitable water access is truly achievable, stakeholders must engage in continuous dialogue about the complexities of both economic and social factors influencing water governance. Capacity-building efforts tailored to increase local governance capabilities enhance the resilience and responsiveness of water management systems (Gorgoglione et al., 2019).

In conclusion, to pave the way toward equitable water economics, stakeholders must reconsider the existing frameworks governing OpEx and explore innovative solutions that prioritise fair access for all. Emphasising performance-based funding and equitable service delivery strategies will ultimately ensure that securing access to clean, affordable water becomes a collective priority, fostering resilience and promoting health and well-being in all communities.

 

6 Case Study: Kampala, Uganda

In Kampala, the National Water and Sewerage Corporation implemented a targeted operational expenditure (OpEx) investment plan to improve service in informal settlements. By cross-subsidising operations from higher-income zones, expanding mobile maintenance units, and using smart metering to reduce losses, they increased daily water availability by 60% in low-income areas.

The implementation of a targeted operational expenditure (OpEx) investment plan by the National Water and Sewerage Corporation (NWSC) in Kampala serves as a case study demonstrating how strategic resource allocation can improve water service delivery, particularly in informal settlements. Through methods such as cross-subsidising operations from wealthier zones, expanding mobile maintenance units, and utilising smart metering technology, the NWSC has achieved notable improvements, including increased daily water availability in low-income areas (Kayaga & Smout, 2014).

In Kampala, traditional water supply systems have struggled with inefficiencies stemming from inadequate funding, resulting in significant water losses and unreliable service (Mutikanga et al., 2011). By employing a cross-subsidy approach, NWSC directed surplus revenues from affluent districts to enhance service operations in poorer neighbourhoods, effectively addressing disparities in water access. This model not only facilitated fairer pricing structures but also provided vulnerable communities with improved water access without placing an undue financial burden on lower-income households (Kayaga & Smout, 2014).

Mobile maintenance units have become a vital component in maintaining the operational integrity of water distribution networks. The deployment of these units has enabled rapid responses to system failures, ensuring that outages are addressed promptly and effectively. The ability to restore service quickly is crucial in enhancing public trust and maintaining community well-being, especially where water supply interruptions can lead to profound health implications (Kayaga & Smout, 2014). Reports indicate that the efficiency gained from such units significantly reduces downtime and enhances overall service delivery (Mutikanga et al., 2011).

The integration of innovative metering technologies further complements these operational enhancements. By adopting advanced metering protocols, NWSC was able to gather real-time water usage data, which informed not only operational decision-making but also provided insights into consumer behaviour and demand forecasting (Salomons et al., 2020). With better visibility into actual water usage patterns, utilities can optimise resource management, detect leaks more effectively, and minimise water losses, thereby enhancing the overall efficiency of the supply chain (Salomons et al., 2020; Kayaga & Smout, 2014). Such technological investments align well with the increased trend of using innovative technologies in urban water management, reinforcing the connection between data-driven resource allocation and improved service outcomes.

Moreover, the successful implementation of these strategies in Kampala signals broader implications for other cities facing similar challenges. The lessons learned can guide policy frameworks, emphasising the need for investment not just in infrastructure but also in ongoing operational support mechanisms. By integrating performance-based funding models into municipal planning, cities can ensure that improvements in water delivery translate into long-term sustainability (Kayaga & Smout, 2014; Huang et al., 2020).

In conclusion, the NWSC's proactive approach in Kampala illustrates how targeted OpEx investments can effectively close the gap in water access equity. By employing cross-subsidy tariffs, mobile maintenance units, and smart metering technology, the agency has demonstrated a commitment to improving service delivery for the most vulnerable populations. As other urban centres evaluate their water management strategies, the learnings from Kampala present a compelling case for integrated, equitable approaches to achieving sustainable water access for all.

Key Observations:

1. CapEx Challenges: Many countries face issues with insufficient or inequitable capital investments, leading to infrastructure gaps.
2. OpEx Challenges: Chronic underfunding of operational expenditures results in system failures, inequities, and reliance on expensive alternatives. ​
3. Equity Issues: Marginalised communities, rural areas, and low-income populations are disproportionately affected by both CapEx and OpEx shortcomings. ​

A matrix summarising all the countries mentioned categorised by CapEx and OpEx issues, along with the specific challenges or issues highlighted :

No	Country/Region	CapEx Issues	OpEx Issues	Specific Challenges/Issues
1	Uganda	Lack of CapEx for informal settlements.	Success in targeted OpEx investment (Kampala case study). ​	Increased daily water availability by 60% in low-income areas through cross-subsidies and smart metering. ​
2	Latin America	Donor-funded CapEx projects often collapse. ​	Small municipal utilities lack the financial/technical capacity for OpEx. ​	Infrastructure degradation due to missing operational budgets. ​
3	East Africa	Donor-funded CapEx projects collapse within a year. ​	Missing budgets for fuel and staff lead to system failures. ​	Short-term investments fail without long-term operational support. ​
4	High-Income Countries	CapEx investments exist but are undermined by austerity policies.	Shrinking maintenance budgets disproportionately affect low-income/Indigenous communities. ​	Reduced funding for OpEx leads to inequities in service reliability. ​
5	Kenya	Intermittent water supply in low-income areas. ​	Poor OpEx allocation leads to reliance on expensive alternatives. ​	Residents pay higher costs for water from vendors and face health risks from unsafe sources. ​
6	Mozambique	Inequities in CapEx allocation for water infrastructure.	OpEx disparities lead to intermittent supply and dissatisfaction. ​	Distance from water mains affects access and satisfaction with water services. ​
7	Bangladesh	CapEx investments in tubewells fail to address arsenic contamination.	Limited OpEx for monitoring water safety.	Inequities in access to safe water persist despite infrastructure investments. ​
8	Peru	CapEx investments in piped systems fail to ensure equitable access. ​	Chlorine residuals vary significantly with socioeconomic status. ​	Inequities in water quality based on socioeconomic status.
9	Ethiopia	CapEx investments in non-piped improved sources fail to ensure safety.	Limited OpEx for water quality monitoring.	Poor households rely on unsafe sources, increasing inequality. ​
10	Nicaragua	CapEx investments fail to ensure safe water access for poor households. ​	Limited OpEx for water safety monitoring.	Inequities in access to safe water persist. ​
11	Nigeria	CapEx investments fail to address cholera outbreaks. ​	Limited OpEx for water quality monitoring and infrastructure maintenance.	Water scarcity and poor drinking water quality exacerbate health crises. ​
12	Jordan	Significant CapEx investments in water supply networks. ​	Limited OpEx improvements lead to persistent intermittency. ​	$275M investment showed moderate improvements but failed to address supply duration issues.
13	Tajikistan	CapEx investments fail to address inequities in water access. ​	Limited OpEx for water quality monitoring.	Inequities in access to safe water persist. ​
14	Malawi	CapEx investments fail to address urban-rural disparities. ​	Limited OpEx for rural water systems.	Urban-rural inequalities in water access persist. ​
15	Zambia	CapEx investments fail to address service continuity. ​	Limited OpEx is available for urban and peri-urban water systems.	47% of households reported water unavailability for at least one day in the previous fortnight. ​
16	Indonesia	CapEx investments fail to address sinking coastal areas. ​	PDAM services struggle due to insufficient OpEx. ​	Rainwater harvesting becomes a community-driven solution due to the high costs of refilled water. ​
17	Cameroon	CapEx investments in river basin management are insufficient.	Limited OpEx for community-based water governance.	Lack of participation and engagement of local resource users in decision-making processes. ​
18	Uruguay/Brazil	CapEx investments in transboundary watersheds fail to address equity.	Limited OpEx for sustainable water-sharing agreements.	Water-sharing conflicts persist due to a lack of operational coordination.
19	China	CapEx investments in domestic water systems show regional disparities.	Limited OpEx for equitable water pricing reforms. ​	Domestic water prices vary significantly based on economic development and income levels. ​
20	Sub-Saharan Africa	CapEx investments fail to address physical and economic water scarcities. ​	Limited OpEx is used to address interpersonal and regional conflicts over water. ​	Water insecurity leads to interpersonal and regional conflicts.
21	Poland	CapEx investments in integrated water management are slow.	Limited OpEx for sustainable water management strategies.	National and regional policies are poorly translated into local planning documents. ​
22	United States	CapEx investments fail to address inequities in water access. ​	Limited OpEx is needed to address affordability and water quality issues. ​	Low-income neighbourhoods and communities of colour face inequitable impacts. ​
23	Canada	CapEx investments fail to address water insecurity in First Nations communities.	Limited OpEx is used for monitoring small water systems.	73% of water systems in First Nations communities are at medium to high risk. ​
24	Greece	CapEx investments fail to address unmet health and water needs. ​	Limited OpEx is used to maintain water services during austerity. ​	Economic crisis and austerity measures undermine access to reliable water services. ​

 

7 Conclusion

Operational spending is not an optional add-on — it is the heartbeat of water equity. Without it, infrastructure becomes a privilege, and access becomes a lottery. To build just, resilient water systems, OpEx must be placed at the centre of planning, funding, and policy.

In conclusion, operational spending is fundamental to the equitable distribution of water resources, serving as a critical element that sustains water equity. When operational expenditures (OpEx) are neglected or treated as optional in water management, it can transform what should be a universal right into a privilege for a select few, effectively making access to water contingent on one's socioeconomic status. This is particularly evident in informal settlements and marginalised communities, where infrastructure is often inadequate, and resource allocation frequently favours wealthier areas.

Achieving accurate equity in water access requires prioritising OpEx in planning, funding, and policy agendas. Various studies and case examples illustrate that integrating operational cost considerations into governance frameworks can help ensure that vulnerable communities are not sidelined in service provision. For instance, targeted operational improvement initiatives in Kampala, Uganda, demonstrate how addressing operational costs can enhance service delivery in disadvantaged areas, ensuring that water systems function optimally for all citizens without discrimination.

As stakeholders in local water systems consider who benefits most from reliable service, recognising existing gaps and the communities that remain underserved is imperative. Historical patterns of funding inequities reveal that low-income and marginalised populations often bear the brunt of service disruptions and deteriorating infrastructure. The solution lies in adopting new governance models that promote transparency, fairness, and inclusivity in resource allocation. Implementing cross-subsidy tariffs, targeted subsidies, and robust maintenance strategies is essential to rebalance this equation, ensuring that marginalised groups are both acknowledged and prioritised in discussions on water equity.

Moving forward, policymakers, utility operators, and civil society must engage collaboratively in discussions aimed at dismantling barriers to equitable water access. By shifting the narrative to emphasise operational expenditures in water governance, we can work towards more resilient water systems that support social equity and sustainability. This strategic repositioning can address service disparities and facilitate the development of just, resilient, and inclusive water systems worldwide.

 

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