Households’ willingness to pay for quality of drinking water in Jaffna area of Sri Lanka

Jaffna Peninsula of Sri Lanka depends on groundwater for drinking water. Supply of clean drinking water has become limited due to overuse of agrochemicals, widespread use of pit latrines, and seawater intrusion. The aim of this study is to estimate the willingness to pay for the attributes of water quality and supply. One hundred and twenty households were randomly selected in the study area. A choice modeling approach was employed. The result indicates that, on average, households’ willingness to pay for the improvement of water quality is three times higher than their monthly payment. Households are willing to pay more for reduction in calcium than for reduction in nitrate and improvement of other attributes. The education level of households influences willingness to pay for the improvement of water quality more than the income level of households. There is high potential to finance for the improvement of the water quality from the households. Water supply and drainage board can afford to supply the drinking water at the WHO standard and charge price on a volumetric basis. The findings of this study would be useful for policymakers to set the appropriate price and policy to develop a sustainable project.


INTRODUCTION
Access to safe drinking water has been one of the main concerns in developing countries over the past four decades Nagarajah et al. ). Pollution of groundwater is receiving attention in Sri Lanka as nitrates from inorganic nitrogen fertilizers and human waste matter from septic tanks enter the groundwater. A research study has shown that nitrates in the groundwater tend to accumulate in the densely populated region of Sri Lanka. Nitrates that could be transformed as carcinogenic substances within the body cause esophageal cancer in Sri Lanka (Dissanayake ).

Nitrate contamination of groundwater in Jaffna
Peninsula has been receiving attention from the early 1980s (Maheswaran & Mahalingam ). The high nitrate levels in the groundwater in the peninsula are most likely associated with the intensive cultivation in that region. In addition to the heavy application of inorganic fertilizers, farmers apply large amounts of animal waste, green manure, and crop residue. Nitrate-N concentrations in the groundwater in the intensively cultivated area ranged from 10 to 15 mg/L (Mikunthan & De Silva ). Nitrate is potentially hazardous when present at sufficiently high levels in drinking water. The WHO reported that high nitrate level was linked to methemoglobinemia (blue baby syndrome), especially in infants. However, there is a high risk of nitrate toxicity related to blue babies in the peninsula.
Nitrate, which can be converted into carcinogenic substances such as nitrosamines within the body, cause the carcinogenesis of esophageal and stomach cancers (Dissanayake ). A study on the pathology of malignant tumors in Sri Lanka from 1973 to 1977 has confirmed that the occurrence of cancer is relatively higher in the Jaffna District than other districts in Sri Lanka. One of the reasons for esophagus cancer could be the higher levels of nitrate-N in groundwater (Panabokke ). Sivarajah () reported that the high nitrate content in water could be associated with the high incidence of cancer of the gastrointestinal tract in the people of Jaffna. Gunalan et al. () in their study in the Chunnakam aquifer area concluded that there is a high risk of cancer due to the consumption of well water with nitrate-N concentrations higher than the recommended level by the WHO. Therefore, an awareness program should be conducted on the effects of the overuse of inorganic fertilizers on the quality of groundwater.  (Panabokke & Perera ). The monsoon rain is the only recharge component of the groundwater. The major factor that has contributed to increased salinity in the well water has been the overextraction of water from the underground aquifers. The large amount of withdrawals from wells lowered the fresh water heads in the underground aquifers and led to salt water intrusions in several areas in the peninsula (Nanadakumar ). Around 80% of this groundwater is used for agriculture purposes and the remaining 20% is used for domestic use in Jaffna Peninsula. Several studies in water quality have shown higher levels of nitrates in domestic wells situated in municipal areas of the peninsula (Nagarajah et al. ). The supply of clean drinking water in Jaffna peninsula has become limited due to overuse of agrochemicals, widespread use of pit latrines, and seawater intrusion. The groundwater is easily contaminated with pollutants as the sandy soil layer is very thin in some parts of Jaffna Peninsula. The persistence of these pollutants in aquifers is many times greater than in soils (Lawrence & Foster ). Therefore, there is an urgent need to supply drinking water for all the households in Jaffna Peninsula. is interpreted as an indication of the demand for improved services and their potential sustainability (Kaliba et al.

).
Our primary aim is to estimate the willingness to pay for reduction in nitrate level and calcium level and improvement of water supply and taste and the welfare effect of good quality water supply in Jaffna Divisional Secretariat area. Figure 1 shows the map of Jaffna Divisional Secretariat area of Jaffna District.

METHODOLOGY
Non-market valuation method can be used to assess the value of goods and services that are not bought or sold in a market. Valuation of water quality improvements can use either market or non-market valuation techniques.  The utility function (U) is a function of an observable component (indirect utility function) and an unobservable error component: where V is the indirect utility function and ε is the stochastic error term. We assume that the indirect utility is a linear form: where (X ki ¼ {x 1 , 2 , …, x k }) is a vector of k attributes associated with alternative i, β is a coefficient vector, m i is income for a respondent choosing the alternative i bundle, and α is the coefficient vector of income. If the stochastic error term is logistically Gumbel distributed (Type I extreme value distributed), the choice probability for alternative i is given by: where ρ is a positive scale parameter and C is is the choice set for an individual. For convenience we generally make the assumption ρ ¼ 1. To estimate willingness to pay for a change from the status quo state to the chosen state, the following formula is used: where V i and V j represent utility before and after the change and CV is compensating variation, the amount of money that makes the respondent indifferent between the status quo and the proposed scenario. Conditional logit model can be applied to estimate the welfare measure in Equation (4). Equation (4) can be restated as: α i and α j are assumed to be equal if marginal utility of income for a respondent is constant. The welfare change is estimated by: In conditional logit model, coefficient of k attributes across all alternatives are the same, and β i ¼ β j ; only the attribute levels differ across the alternatives, Under this condition, welfare change is estimated by the following: Equation (7) is used to estimate welfare changes, assuming the impact of the attributes of drinking water quality.

RESULTS AND DISCUSSION
The descriptive statistics of Jaffna Divisional Secretary Area are given in Table 4. The result indicates that the average age of respondent, education level, and monthly income was 50 years, 10 years, and 25,000 LKR, respectively. Three conditional logit models were developed using effective codes for four water attributes. Results of three conditional logit models are presented in Table 5. As a simple model, model respectively. This indicates that households with above 11th grade education and monthly income above 30,000 LKR are averagely willing to pay more for reduction in calcium level, reduction in NL, and increase in the frequency of water supply than households with lower education and income level. The interaction terms of reduction of CL and NL with lower level of education are negative and significant at 5% level. This result indicates that households with lower education level are willing to pay less for reduction in calcium and nitrate level than households with higher education level. The interaction term of reduction in NL with lower income is negative and significant at 5% level.
This implies that households with lower income level are averagely willing to pay less for nitrate reduction than households with higher income level.
The interaction of reduction in CL with income level is not significant at 5% level. This shows that, on average, there is no difference in WTP to reduce CL in the drinking water among households with different income level while other things are equal. As all households in this study area know there is a higher level of calcium in the tap water and also they observe calcium deposits in kitchen utensils while boiling water, all households would like to pay to reduce CL in the drinking water. The higher magnitude of coefficient of reduction in CL among the attributes of the tap water shows that households give higher priority to reduce CL than the improvement of other attributes of tap water.
Even if higher NL in the drinking water causes serious health effects to humans than calcium in drinking water, households give less priority to the reduction in NL than reduction in CL. This might be due to their lower education  level and also they could not observe the effect of nitrogen immediately. The interaction terms of frequency of water supply and taste with education and income are not significant at 5% level. Since most of the households collect enough drinking water for the needs of a day from a tap installed in a common place near to their home at one time, the interaction terms of frequency of water supply with income and education level are not significant at 5% level.
Mean welfare values from the improvement of each attribute of water quality except taste attribute and supply for different household groups were estimated by using Equation (7) and the estimated mean WTP for each attribute is presented in Table 6. Since taste attribute is not significant at 5% level in model 3, WTP for it is not estimated. It shows that households with above 11th grade education and income above 30,000 LKR are willing to pay more (296 LKR) for reduction in NL, reduction in CL, and increase the frequency of water supply than other household groups with either lower income or lower education level.
All households are, on average, willing to pay more for reduction in CL than for the improvement of other attributes. Households with education below 11th grade and income below 30,000 LKR are willing to pay the lowest amount (120 LKR) for the improvement of water quality and supply among all the household groups and also they are not willing to pay for reduction in NL as indicated by negative WTP. As shown in Table 6, among the randomly selected households, percentage of households with income more than 30,000 LKR and higher than 11th education level, with income more than 30,000 LKR and lower than 11th grade education, with less than 30,000 LKR and higher than 11th grade education, and with less than 30,000 LKR and lower than 11th grade education is 6%, 20, 27, and 47%, respectively. Therefore, it can be expected that average WTP from households in this study area for the improvement of water quality and supply is around 174 LKR (USD 1) per month as user charge. As there are a total of 1,688 families in Jaffna Divisional Secretariat area, the total WTP from households per month for the improvement of water supply is around 293,712 LKR (USD 170). As shown in Table 6, education level of households influences WTP for the improvement of water quality and supply more than the income level of households. Even if NL in drinking water causes serious effects to humans, they are willing to pay less for reduction in NL than reduction in CL. The result of this study shows that there is high potential to improve the water quality and supply as all households' WTP for the improvement is much higher than their monthly payment of 60 LKR (USD 0.33) for water from a common tap. Since most of the places in the study area are coastal areas, groundwater from households' own well is saline. As the study is densely populated and there is no common sewage system, groundwater is polluted with Escherichia coli bacteria and nitrate.
Therefore, they use this well water for washing and bathing but not for drinking. Household's WTP for the improvement of water supply in this study area is three times higher than the current monthly payment. Therefore, there is high potential to finance the improvement of the water quality and supply from the residents of this area. The water supply and drainage board can find good quality water sources with less nitrate and calcium concentration in Jaffna Peninsula and purify the water to the WHO standard. This good quality drinking water could be efficiently utilized if the authority provides a supply to homes and charges the price for the water on a volumetric basis.

CONCLUSION
This study concludes that there is high potential to improve the water quality and supply as all households' WTP for the improvement is much higher than their monthly payment (60 LKR) for water from the common tap. All households are, on average, willing to pay more for reduction in CL than for the improvement of other attributes. The education level of households influences WTP for the improvement of water quality and supply more than the income level of households. Even if NL in drinking water causes serious effects to humans, they are willing to pay less for reduction in NL than reduction in CL. The groundwater from households' own well is saline and polluted with E. coli bacteria. Households willing to pay for the improvement of water supply is three times higher than the current monthly payment. Therefore, there is high potential to finance the improvement of the water quality and supply from the residents of this area. The water supply and drainage board can afford to supply the drinking water at the WHO standard to households and charge price on a volumetric basis. The government health department should conduct an awareness program for the households in this study area regarding the serious health effects of nitrate in drinking water. The findings of this study would be useful for policymakers to set the appropriate price and develop a sustainable project to improve the water quality and supply from the common tap in this study area.

DATA AVAILABILITY STATEMENT
All relevant data are included in the paper or its Supplementary Information.