Methodology for economic evaluation of water management

Economic analysis is the key requirement of EU Water Framework Directive. On a level of river basin
area, economic analysis includes three dimensions: 1. economic characterization of water use: current
and future projected economic importance of capacities and potentials of water resources; 2. program of
measures for achieving good water status: cost-benefit analyses, cost efficiency analyses, cost scale and
influence: and 3. water services price policies: evaluation of institutional alternatives for recovery of
water services costs, including analysis of cost distribution. The analysis includes leveling of current
and projected water resources data with costs and benefits of water services on the level of river basin
area within local communities and integrated on sub-region level.