Social Cost of Water Quality Degradation for Public Supply

ABSTRACT This paper proposes the evaluation of social cost of water quality degradation in urban reception basins of the Federal District, Brazil. We sought to elaborat a procedure allowing the economic evaluation of the loss of forest coverage impacts on welfare. The impacts of water quality degradation was estimated in two classes of residential consumers of public water supply. In the popular category (low income), the social cost was estimated at $ 7.0 million per year, which represents 8.9% of total expenditure on water consumers in this category from January 2003 to December 2008. In the regular category (middle and high income) the social cost was estimated at $ 12.9 million per year, the equivalent to 6.8% of total expenditure with water consumer in the period studied.