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5.17 For example, for a village with a population of 10,000 inhabitants, the total monthly capital and operating costs of a rural water systems are about Nl19,000.0 To these costs must be added the expenses of running the kiosks themselves. Assume that one tap would be required per 500 people, and that each kiosk would have 2 taps from which people could collect water. The community would thus require 10 kiosks. Assuming each kiosk attendant is paid N25 per day, the monthly labor costs of the 10 kiosk attendants would be about N8,000. Total monthly costs of the water system would thus be about N27,000.

5.18 The total revenues from such a system can also be approximated (see Figures 12 and 13). Assume that per capita water consumption is 4 gallons per day and that 50 percent of the water consumed in the village would be purchased from kiosks. In this case each tap would only have to serve on average 250 people and queue times would not be excessive if sufficient pressure were maintained. Households currently sell water to neighbors for NO.70 to N1.00 per 4-gallon bucket (NO.18-0.25 per gallon); suppose that the kiosk system only charged NO.20 per 4-gallon bucket (NO.05 per gallon) in the dry season and NO.10 per hucket (NO.025 per gallon) in the rainy season. Given these assumptions monthly gross revenues in the dry season would be N30,000; in the rainy season they would be N15,000. Such revenues should be sufficient to pay over 80 percent of the total annual costs--both the capital and the operating and maintenance costs--of the improved water system.

5.19 In several respects these assumptions are quite conservative. Per capita consumption could easily reach 5 or 6 gallons per day when water is readily available from a kiosk, and it is likely that more than 50 percent of the water consumed in the village would be obtained from the kiosk system (see Box 3). It is thus entirely possible that full cost recovery could be achieved in many places. However, given the volatility of the cost estimates, the extent to which kiosk systems can achieve full cost recovery in different locations must still be considered uncertain. It does appear though that the revenue potential from kiosks is significantly higher than for other cost recovery mechanisms. Thus, whatever the final capital and operations costs of the water system, kiosks are likely to recover a much higher proportion of these costs than alternative approaches.

5.20 There are two main reasons why we believe that most households would prefer to obtain water from a well-run, reliable kiosk system than from tanker trucks. First, in the long run the price of water from the kiosks should be substantially cheaper than water from neighbors supplied by tanker trucks or from tanker trucks directly. Second, since the service provided by tanker trucks is often unreliable, people would be more likely to go to a kiosk for water than to wait for a tanker to come. As communities become more affluent and the value of some households' time increases, vendors using carts, bicycles, or simply poles or yokes may carry water from the kiosks direct:.y to households. Such a development should cause no financial problems for the kiosk system as long as such vendors are charged the same price for water as individuals who walk to the kiosk and purchase water directly.

1I/ This figure is based on the cost estimates presented in Table 3. Capital costs assume a capital recovery factor of 0.16; operating costs include labor, fuel and lubricants, and minor maintenance.