Differences between Households and Commercial Water Users Willingness to Pay for Improved Water Supply A Case in Calbayog City, Philippines

The study explores the differences between households and commercial water user’s willingness to pay (WTP) and their reasons for WTP for improved water supply. Random sample of water user from local water district were interviewed about their WTP. Meanwhile independent t-test and logit regression  were used in determining the differences of two groups and predicting the variables that would affect the willingness to pay respectively. Independent sample t-test shows that the two groups’ have nosignificant differences on awareness on Calbayog Pan-as Hayiban Protected Landscape (CPHPL), WTP,Bid Amount, and Income which theoretically would affect its perception on WTP. Meanwhile, Bid Amount and its Awareness on CPHPL showed to be a significant predictor of households and commercial water users WTP. However, it is unlikely that PES would be successful in the area since only 46.6% are willing to pay out of 445 respondents both household and commercial water users. Nevertheless, the analysis was able to estimate a value of Php 4,858,105.92 for the protection of watershed area. Awareness campaign about CPHPL in the city of Calbayog and its importance to water supply in general prior to  implementation of watershed protection program and collecting user fees among water users. Likewise, if PES would be implemented, the incremental user fee should be studied carefully as this would affect the water users (e.g. direct beneficiary of watershed) likelihood to participate in the protection program of the CPHPL.

Keywords: willingness to pay, contingent valuation, payment for ecosystem services, domestic water use, protected area