In Addis Ababa, an increasing block tariff has been used to calculate households’ monthly bills for electricity and water services. This study estimates the magnitudes of the combined water and electricity subsidies received by households with private connections to the electricity grid and piped water network in 2016, and it evaluates the distribution of these subsidies among wealth groups.

Climate change will affect the supply of many resources that households consume, including electricity, and natural gas. Although price is considered an effective tool for controlling demand for many resources that households consume, including electricity and natural gas, its impact is poorly understood. Part of the problem is that demand is confounded by block pricing and the interrelated consumption of electricity and natural gas, which prevent easy estimation of price impacts.