Water and wastewater tariffs are usually designed as a single part tariff or as a combination of two tariff structures. Charges can be set depending or not from the volume of water consumed. In the first case, water metering is needed. A brief overview of water and wastewater tariffs generally adopted by water utilities is given below:

• Fixed charge: the monthly water bill is independent of the volume consumed.
• Uniform volumetric tariff: is a volumetric charge with a rate proportional to water consumption (metering is needed). All units (cubic meters) are priced the same rate, independently of total consumption.
• Increasing block tariff: is a step-wise volumetric charge (metering is needed). With this tariff the unit charge is constant over a specific range of water use block) and then increases as the consume increases.
• Decreasing block tariff: is the opposite of the increasing block tariff: the rate per unit of water is high for the initial (lower) block of consumption and decreases as the volume of consumption increases.
• Two parts tariffs: have a fixed charge component plus a variable charge depending on the volume of water consumed (e.g. increasing block or uniform tariff). Two parts tariffs are widely promoted by the World Bank, aim at recovering costs and achieving economic efficiency. The fixed part usually corresponds to the fixed costs of production and administration and the proportional part can be adjusted to the marginal cost.

(Oliver 2006)