Research Line: Economic efficiency and pricing structures

Research Line: Economic efficiency and pricing structures

Currently, IWW is an established institution for benchmarking in the water sector. At the moment, IWW is extending the benchmark process with tools from qualified efficiency analysis. Statistical methods like advanced regression analysis, Data Envelopment Analysis and Stochastic Frontier Analysis are being adapted to the special needs and boundary conditions of the water supply industry.

Regarding the increasing pressure to improve efficiency and the rising competition in the German water industry, significant structural changes in the water sector are to be expected. Research on methodology and tools can support the analysis with regard to the efficient supply chain, the optimal size of supply systems and the realisation of scale efficiencies. Diverse forms of cooperation and new organisational models will have to be evaluated under this scenario. In this context the evaluation of assets will become more important in terms of financial and cost-related management strategies. Regarding this aspect, IWW will deliver the water-related instruments to determine sustainable asset prices in the future.

Research Line: Cost and benefit analysis

Regarding assets, the water industry will have to face the gap between the availability of (decreasing) revenues and the occurrence of costs. Research will have to prepare modern approaches of cost management like total cost ownership and life cycle costing to derive optimal asset strategies for water suppliers. Climate and demographic changes and the general decrease in water consumption will impact the supply system capacity. There is a strong need for financially sustainable solutions. Major changes in the financial structure in the water industry have to be introduced considering the social acceptance to better care of the needs of the public. IWW will adapt existing methods like Cost-Benefit analysis to water related topics. The idea is to develop and provide strategic decision support via innovative instruments like road map concepts, participation of different interest groups for a balanced water supply strategy taking into account efficiency in supply as well as environmental concerns.


Dipl.-Volksw. Andreas Hein
Phone: +49 208 40303 340
e-mail: a.hein@iww-online.de