Possible Adverse Effects of Increasing Block Water Tariffs in Developing Countries

The use of increasing block water tariffs is widespread throughout developing countries. An increasing block tariff (IBT) is a price structure in which a commodity is priced at a low initial rate up to a specified volume of use (block), then at a higher or several increasingly higher rates for additional block used.

The ordinary household municipal water bill in developing countries is often calculated on some sort of IBT structure, and donor organizations and consultants continue to recomend this practice for town and city water systems.