









































Pa
ge

 
1



Pa
ge

 
23

3

American Journal of   Environmental
Economics (AJEE)

Cost–Benefit Analysis of  Rainwater Harvesting Systems in Bangladesh: A Case Study of  
Mongla Upazila

M M Makfur Hassan1*, Tahmina Hossen Ethika2

Volume 4 Issue 1, Year 2025
ISSN: 2833-7905 (Online)

DOI: https://doi.org/10.54536/ajee.v4i1.6388
https://journals.e-palli.com/home/index.php/ajee

Article Information ABSTRACT

Received: October 20, 2025

Accepted: November 22, 2025

Published: December 11, 2025

Coastal areas in Bangladesh are finding it harder to get safe, cheap drinking water because 
saline water is getting in, rainfall is unpredictable, and other water sources are pricey. This 
study looks at whether it is worthwhile for families to set up Rainwater Harvesting (RWH) 
systems in Mongla, a salinity area in Bagerhat. This study used a Cost-Benefit Analysis 
(CBA) to figure out if  it pays off. This study looked at things like Net Present Value (NPV) 
of  293938.6 BDT, Benefit-Cost Ratio (BCR) of  20.9, Internal Rate of  Return (IRR) of  
236.09%, Health Cost and how long it takes to get money back. The study got info from 
surveys of  100 people who use RWH and 100 who don’t, including costs for setting up, 
maintenance, health, and time spent.  RWH systems really cut down on the time and money 
people spend getting water and going to the doctor because of  unpurified water. Even if  
initial costs go up or benefits go down, the system still works well. RWH looks like a cheap 
and easy way to deal with the drinking water problem in coastal Bangladesh. The study says 
RWH should be included in the country’s water plans, give poor families money to set up 
these systems, and train people to keep them running.

Keywords

Cost-Benefit Analysis (CBA), 
Net Present Value, Rainwater 
Harvesting, Sustainable 
Development, Water Management

1 Environmental and Resource Economics, University of  Dhaka, Dhaka, Bangladesh
2 Bachelor of  Dental Surgery, University of  Dhaka, Dhaka, Bangladesh
* Corresponding author’s e-mail: hasan.bee4@dsce.edu.bd

INTRODUCTION
Rolling up and storing rain is a highly demanded for 
drinking water management, particularly in topographic 
regions that are running succinctly due to weather changes. 
The inhabitants of  the Mongla Upazila in Bagerhat 
District have access to a source of  water which is actually 
very fresh for drinking. The report I’ve been reading from 
the Bangladesh Government shows that chloride (CL) 
concentrations in the aquifer can reach up to 9500mg/L. 
WHO states that anything exceeding 250 mg/L refers 
to, and anything between 600 and 1000 mg/L is already 
evaluated as excessively saline for drinking. Nevertheless, 
many people drink the unpurified water, so they have 
no other option when it comes to meet their daily water 
needs. While it is clear that rain harvesting benefits the 
conditions and communities, little information is available 
on its fiscal effects at the household level, especially in 
rural areas, such as Mongla, which is helpless in relation 
to climate change. In Bangladesh, the main investigative 
focus is either on the technical side or on the manner in 
which the rainwater frameworks help the inhabitants or 
on the manner in which they are low cost to the families. 
The mandatory monetary index appreciation Net Present 
Value (NPV), Benefit-Cost Ratio (BCR), and intrinsic 
Return Estimate (IRR) has not been given sufficient 
attention here. Consequently, a number of  judgments 
on procedures and community undertakings lack strong 
indications that the rain collects wages for the family.

Objectives of  the Study
The purpose of  this study is to assess the financial 
usefulness of  household RWH systems in Mongla through 

a detailed cost-benefit analysis. Initial investments, labour 
costs, nestlings in water, and structure longevity exceeding 
20 years are considered in this assessment. The impact 
of  key financial factors such as water prices, care costs, 
inflation and discount rates on the resilience of  such 
arrangements will also be examined.  

Research Questions
There has a full questionnaire set of  survey questionnaire, 
FGD and KII questionnaire, the main focus of  the 
questionnaire is: 

1. Is household rainwater harvesting systems 
economically viable in Mongla, Bagerhat?

2. What are the main financial indexes (NPV, BCR, 
IRR, and repayment time) associated with a typical RWH 
system in the current region?

3. How do variations in cost, rainfall, or maintenance 
affect the economic sustainability of  RWH systems?

LITERATURE REVIEW
Rainwater Harvesting (RWH) is regarded as a long-
term water supply solution, particularly in regions where 
reliable access to pure groundwater or piped water 
is lacking. Family RWH frameworks typically include 
rooftop catchment surface, storage tank (ranging from 
1,000 to 5,000 liter), gutter, and first flushing devices 
in technical clauses. Investigations in the South Orient, 
including Bangladesh and India, reveal that RWH systems 
can supply between 30 % and 60 % of  household water 
supply during the monsoon period (Chowdhury & 
Rahman, 2010; Pande et al., 2019). In the context of  the 
riverine of  Bangladesh, institutions like BRAC deploy 



Pa
ge

 
23

4

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

over 5,000 family and society RWH systems in Mongla, 
which significantly improves access to local water for 
approximately 72,000 inhabitants. Economically, a 
number of  studies have assessed the viability of  RWH 
leveraging parameters such as Net Present Value (NPV), 
Internal Measure of  Return (IRR), and the Payback era. 
For instance, (Islam et al. 2015) carried out a financial 
assessment of  the RWH arrangements in Khulna and 
found them to be financially viable alongside an IRR 
exceeding 10% and a repayment period of  less than 7 
years. Similar discoveries were made in the research 
conducted in Chennai, India, where rooftop RWH 
systems resulted in a reduction in municipal water costs 
and a decrease in the force used to extract groundwater 
(Chandrasekar et al., 2018). These questions underline the 
double support of  cost reserves and green conservation. 
Cost–benefit analysis (CBA) is a necessary tool for 
water provision economics enabling partners to Analyze 
the long-term monetary and interpersonal addition of  
intervention to their capital and working costs. CBAs 
have been used to assess the various water system 
undertakings, including irrigation systems, desalination 
plants, and community water supply schemes. Haque and 
Siddique, who had been introduced to CBA in the year 
2012-12 in order to measure the sand filter in the saline-
prone region of  Satkhira and discover a robust benefit-
cost ratio and a net tax return, had been acquainted with 
CBA in the year 2012-12. KC et al. (2016) permitted CBA 
to justify investments in gravity-fed water supply systems, 
demonstrating higher tax returns on duration reserves 
and better welfare outcomes. However, its use, the use 
of  strict CBA paradigm to establish RWH frameworks in 
climate-vulnerable areas of  Bangladesh remains limited. 
Most prevalent surveys either prioritized technical 
viability or applied an easy economic prosody lacking a 
rejection of  the approaching cash flow, faltering in order 
to translate the costs of  organizational life, operation and 
maintenance (O&M) costs, or inflation adjusted nest egg.
Nearby is a significant lack of  region-specific fiscal 
evaluation for family RWH in southwest Bangladesh, 
especially in coastal upazilas such as Mongla. 
Furthermore, a small number of  investigations integrate 
applied statistics from NGO intervention (BRAC’s 
RWH program under conventional financial appraisal 
standards). Moreover, sensitivity analyses, a key element 
in assessing the resilience of  undertakings under cost 
variability or rain uncertainty, are largely missing.
The present Sheet addresses these shortcomings by 
overseeing the comprehensive design of  the family 
RWH framework in Mongla, integrating installation and 
operation and maintenance costs, water saving, and a 20-
year structure life. We take a look at publicly available 
BRAC information and domestic water price benchmarks 
and estimate a key monetary index, including the NPV, 
BCR, IRR, and Payback Period. Furthermore, sensitivity 
tests were conducted to examine how fluctuations in 
cost and benefit parameters affect fiscal outcomes. By 
providing a resilient and context-specific economic 

evaluation that explores the real world for policymakers, 
NGOs, and donors to understand RWH investments in 
the coastal of  Bangladesh.

MATERIALS AND METHODS
The present study aims to assess the financial feasibility 
of  Rainwater Harvesting (RWH) arrangements at the 
family stage in Mongla Upazila, a salinity-prone region in 
maritime Bangladesh, by adopting a mixed methods study 
design integrating equally quantitative and qualitative 
data. Mongla, located in the district of  Bagerhat, had 
been chosen due to their acute water shortage, salinity, 
and dependence on alternative water sources. The second 
rain variability and socioeconomic vulnerabilities make 
it a key location for the implementation of  RWH as a 
climate adaptation plan.
The primary facts were gathered from 200 families 
(100 RWH users and 100 non RWH users) through 
the structural survey, covers: demography, water usage 
and access, installation and maintenance cost of  RWH 
systems, time spent on water collection, incidence and 
cost of  waterborne diseases, willingness for future 
expansion
The Bangladesh Meteorological Department (BMD), 
local NGOs, and a printed report provided additional 
information on rainfall patterns, water quality, and rural 
wages.
The study applies a Cost–Benefit Analysis (CBA) 
framework using: Net Present Value (NPV), Benefit–
Cost Ratio (BCR), Internal Rate of  Return (IRR), Payback 
Period
We are familiar with a discount rate of  6 %, which is 
constant with the public sector evaluation in Bangladesh. 
In order to assess the robustness of  the consequences 
under a changing fiscal state, sensitivity analysis was 
carried out with 4% and 8%.
Ethical Considerations: During the conception and 
operation of  the study facility, the analysis facility shall 
comply with moral criteria. The following procedures 
were taken into account. Prior to the facts cluster, each 
participant in the inspection was the object of  a light 
sanction. The respondent was informed of  the purpose 
of  the analysis, the voluntary setting of  loyalty, and the 
correct way of  removing it from each span.

• Neither individual identification information (PII) 
nor statistical anonymity has been ensured for statistical 
data. Each statistic was stored in an encrypted electronic 
format which could only be accessed by the review 
partnership.

• The scope of  the investigation does not include all 
clinical procedures or vulnerable populations. A virtuous 
recommendation for group investigation and use of  facts 
has been approved, in line with the investigative protocol 
of  the Individuals of  Bangladesh and the comment of  
Helsinki.

• No financial incentives were provided that could have 
biased responses; participation was entirely voluntary. 
The present moral technique was developed with regard 



Pa
ge

 
23

5

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

to the autonomy of  the participants and to guarantee the 
reliability and honor of  the findings of  the research. 
Tools and Software: Data analysis and financial modeling 
were conducted using a combination of  statistical and 
spreadsheet tools. For the initial data entry, tabulating, 
and basic calculations, including the accumulation of  
accumulated cash flows, the era of  repayment, and the 
calculation of  the time cost, Microsoft Excel was used. 
Using the npf.npv and npf.irr functions, it was used to 
calculate excess high-tech economic prosody, such as 
net current value (NPV) and internal appraisal of  return 
(IRR) STATA was used to generate a visual image, 
including a bar chart, an accumulated NPV graph, and 
a sensitivity analysis plot. QGIS (for Spatial Data) was 
a study on recognizing roof  region power in relation to 
rainfall statistics and catchment functions. All calculations 
were validated by cross-checking results using at least two 
independent methods.

RESULTS AND DISCUSSION
Components of  Rainwater Harvesting System:

• Catchment surface: Gutters, downspouts and roof  
drains, Leaf  screens, first-flush diverters and roof  
washers, Storage tanks, 

• Treatment/purification systems
• Catchment Area: Rooftop area of  30–50 m²

• Storage Tank: 2,000-liter capacity, polyethylene or 
ferrocement

• Components: Gutter system, first-flush diverter, 
downpipe, filtration unit, storage tank, and tap outlet

• Installation Cost: BDT 30,000 per unit (includes 
materials, labor, training, and basic maintenance setup)

• Operational & Maintenance Cost: BDT 1,500 per year 
(includes cleaning, minor repairs, and filter replacement)

• Expected Lifespan: 20 years the system shall be 
designed to collect and store rain during a monsoon 
calendar month and provide safe drinking water to an 
average family of  4–6 members during a dry period.
The average storage capacity of  the rain harvesting tank 
in the 100 survey families was strategic so as to have 
approximately 2,217.17 liters. It should be noted that 
commercially convenient family rain tanks are usually 
manufactured in standard capacities, e.g., 500 L, 1,000 
L, 1,500 L, 2,000 L, or otherwise 3,000 L). Thus, the 
measured average corresponds exactly to a single tank 
size but rather represents the aggregate mean through 
the various storage configurations in the sample. The 
current finding indicates that the majority of  cooperating 
families use tanks with a nominal capacity higher than 
2,000 liters, indicating a preference for medium in order 
to provide large family storage solutions within the limits 
of  penetration into locality. ‘It’s not about the money’.

Table 1: Annual Water Purchase Cost (AWPC)
Parameter Unit Value Notes
Average daily water purchase cost BDT/day 35.12 (1,053.64 ÷ 30 days)
Average monthly water purchase cost BDT/month 1,053.64 Survey data
Annual water purchase cost BDT/year 12,643.68 1,053.64 × 12 months

Table 2: Transportation Cost 
Parameter Unit Value Notes
Average daily transportation cost BDT/day 7.71 (231.39 ÷ 30 days)
Average monthly transportation cost BDT/month 231.39 Based on household survey
Annual transportation cost BDT/year 2,776.68 231.39 × 12 months

• The daily cost (≈ BDT 35.12) reflects the average 
household’s out-of-pocket expenditure for water.

• This is scaled up linearly to produce the monthly and 
annual equivalent for budgeting and cost–benefit analysis.

• This simple linear annualization assumes constant 
demand and stable prices, which is reasonable for basic 
CBA unless seasonal price fluctuations are significant.

The annual household expenditure on purchased water is 
estimated using the average monthly cost (BDT 1,053.64), 
derived from primary survey data. This cost is assumed 
constant throughout the year, resulting in an annual 
water purchase cost of  BDT 12,643.68 per household, 
following the model: AWPC = Cm × 12.

ATC = Ctm × 12 
= 231.39 × 12
= 2,776.68 [tm= Transportation per year]
In the study area (Mongla), local transportation for 
moving goods typically relies on several common modes. 
Rickshaw vans are the most widely used for short distances, 
while manual pedal rickshaws are preferred for carrying 
smaller containers. Easy-bikes, which are battery-powered 

three-wheelers, and tomtoms, locally adapted electric 
or diesel three-wheelers, are also frequently used due to 
their availability and low operating cost. In riverside or 
canal areas, boats become the primary mode of  transport, 
especially during high tide. Occasionally, motorbikes or 
even manual head-loading are used for transporting small 
volumes when other options are not feasible. 
The above-mentioned neighborhood conveyance 



Pa
ge

 
23

6

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

method reflects the ease and convenience of  the water 
accumulation points with respect to the location of  the 
dwelling. From the average monthly family expenditure of  
BDT 231.39, which is equivalent to approximately BDT 
7.71 a day, the annual transport costs of  transporting 
rolled-up water shall be reduced by the amount of  
BDT 231.39 per month. The current cost reflects the 
common practice in Mongla of  hiring small public 
transport vehicles, such as the jinrikisha avant-garde, 
manual jinrikisha, easy motorcycle, Tom-Tom, and boat, 
depending on the distance and seasonality. Therefore, the 
annual moving costs per family are BDT 2,776.68 and are 
planned as follows: ATC = Ctm × 12.
In addition to the main monetary expenditure, the families 
who do not have Rainwater Harvesting (RWH) schemes 
in Mongla incur significant hidden costs by using intervals 
to obtain safe drinking water. Based on the examination 
response, the family spends an average of  616 minutes 
and 12 minutes atop the water collection a year. In order 
to take into account, the real monetary burden, the 
present study uses the possibility of  cost manipulation, 
i.e. loss of  time using the local average daily wage for low 
skilled workers. The hourly wage shall be BDT 56.25, 
together with the prevailing rural wage of  BDT 450 per 
day (working time of  8 hours). Using this rate, the annual 
cost of  cleaning a water cluster is approximately BDT 
34,198 per family per year. This figure represents revenue 
that could have been gained if  the family member had 
been engaged in productive work instead. It also points 
out that the era has been misplaced in tuition, attention 
fatigue, or rest—factors that are not always captured by 
conventional financial analysis. Integrating that prospect 
cost strengthens the scenario for RWH arrangements by 
exemplifying nay is not used in academic writing only for 
their welfare and environmental benefits although, apart 

from their ability to significantly reduce indirect monetary 
burden. This comprehensive assessment is in line with 
the important task of  renewable energy and social equity, 
in particular in the case of  low income and climate-
vulnerable communities.
A household without RWH spends 616 hours a year 
collecting water, which is worth BDT 34,158.75 per 
year, based on community wages in rural areas. The 
cost component measures under the current scrutiny 
include the managing economic expenditure on water 
procurement; transport, medical equipment, and the 
opportunity cost associated with the eradication of  
waste water. According to the information checked, the 
average family spends a monthly outlay of  BDT 1,053.64 
on water, resulting in an annual cost of  BDT 12,643.68. 
The associated transport costs amounted to a total of  
BDT 231.39 per calendar month, amounting to BDT 
2,776.68 per year. Apart from these straightforward costs, 
households without rain collection (RWH) organizations 
spend an estimated 616 intervals per year on collecting 
water. The equivalent hourly wage would be BDT 56.25, 
which is close to the regional average of  450 BDT per day 
for 8 hours of  work per week. Accordingly, the annual 
cost of  duration spent on water harvesting is estimated 
to be approximately BDT 34,158.75. Medical expenditure 
related to the treatment of  waterborne diseases adds 
further to the family burden. In comparison with an 
annual cost of  BDT 25,619.52, each family incurs on 
average BDT 2,134.96 per calendar month in clinical 
expenditure. In the absence of  a RWH structure, the 
annual cost calculated per family is approximately 
BDT 75,198.63. This figure provides a baseline for the 
economic evaluation of  the potential savings that can be 
achieved through the implementation of  rain harvesting 
innovations.

Table 2: Medical Cost
Parameter Unit Value
Average monthly medical cost BDT/month 2,134.96
Average daily medical cost BDT/day  71.16
Annual medical cost BDT/year 25,619.52

Lack of  access to safe drinking water, such as diarrhea, 
dysentery, cholera, typhoid, and skin diseases, is 
significantly increasing the incidence of  waterborne 
diseases in coastal Bangladesh, including Mongla. Such 
diseases require a direct financial burden on the family 
through out-of-pocket expenditures on medical visits, 
medicines and misplaced duty days. Beyond general illness, 
lack of  secure water access and climate stressors have 
hidden gendered impacts: Women and adolescents are 
confronted with a need for monthly cleaning leadership, 
with a large number of  them adopting wrong strategies 
of  coping. During an ecological catastrophe, for instance, 
cyclone, and flood when safety water entry and privacy are 
compromised, females regularly use contraception to delay 
the period of  time when they do not have access to water 

for bathing and hygiene.  C-section births are reported 
in the current exploratory zone by 72.39 % of  female 
respondents, a figure far higher than the federal average, 
and are partially correlated with underprivileged health 
conditions, undernutrition, and stress caused by water 
insecurity. Non-religious households incur significant 
medical costs related to waterborne diseases in addition 
to managing family expenditure on water acquisition and 
transit. The average monthly healthcare expenditure report 
for a family is BDT 2,134.96, corresponding to an annual 
financial responsibility of  BDT 25,619.52 per family (AMC 
= Cmm 12). These costs are primarily intended to protect 
treatment of  diarrhea, dysentery, and other waterborne 
diseases which remain widespread in order that dangerous 
or incoherent drinking water will not be introduced. 



Pa
ge

 
23

7

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

Women and adolescents bear disproportionately the health 
burden of  water insecurity. In the present study, 72.39 % 
of  female respondent reports delivered cesarean delivery, a 
finding significantly superior to regional recommendations, 
echoing the increasing challenges of  maternal health. 
Moreover, the lack of  safe water and sterile resources 
forces many women to suppress menstrual cycles through 
the use of  hormonal contraceptives and exposes them to 
additional health uncertainty during an innate catastrophe. 
The restricted option for menstrual purity exacerbates the 
diseases and entails a greater dependency on the coveted 
medical attention. These results show that the real cost 
of  insufficient water intake extends sufficiently beyond 
the immediate monetary loss, the significant gender-
specific fitness, and the social outcomes that need to be 
addressed through combined water, hygiene, and fitness 
interventions.

Household-Level Cost–Benefit Analysis of  Rainwater 
Harvesting (RWH)

1. Storage Tank Capacity and Seasonal Use The average 
storage tank capacity surrounding the 100 survey RWH 
family was assessed together with 2,217 liters. Although 
this figure does not correspond to a specific market tank 
size (typically 500 L to 3,000 L), it represents an aggregate 
average of  the various family storage arrangements. The 
average number of  family reports using harvested rain 
is approximately 4.14 calendar months per calendar year. 
The current seasonal pattern of  use is consistent with 
regional rainfall allocation, stockpile restrictions, and 
operational efficiency of  rooftop harvesting systems.

2. The initial assets stake the initial assets expenditure 
for the RWH installation, designated C₀, includes the 
procurement and installation of  the storage tank, 
gutter, first flush diverter, and basic filtration unit of  
measurement. The average shareholding in the assets was 
discovered to remain BDT 31,377.90 per family. In the 
CBA skeleton, the current cost shall be treated as an old 
fixed cost. Economic expression: C₀ = Cₜₐₙₖ + Cgᵤₜₜₑᵣₛ + 
Cfirst flush + Cfiltration

3. Annual maintenance expenditure: households 
incur annual maintenance expenditure (Cm) to maintain 
structural functionality and water quality. The expenses 
mentioned above, the average cost of  506 BDT per family 
per year, cover cleaning, minor repairs, and replacement 
of  a plain filter or pipe. The current expenditure shall 
be treated as a recurring operating expenditure in the 
financial model. Economic expression: Cm = Mj (j = 1 to 
nitrogen), wherein Mj = cost of  human care item.

4. Quantifiable annual savings (Sa) arising from the 
implementation of  RWH are primarily intended to 
reduce dependence on purchased water and related 
transportation expenses during the useable storage 
era. Estimated average annual reserves per family were 
approximately BDT 4,864.60. Economic expression: Sa 
= (Cw + Ct) savings, where Cw = water purchase cost 
avoided, Ct = transport cost avoided

5. Fitness Cost Assets and Co-benefits the reduction in 

family expenditure on medical treatment for waterborne 
diseases is an essential co-benefit of  RWH adoption. The 
average monthly cost of  BDT 2,134.96 is reported by 
the non-RWH family, while the RWH family reports a 
very low monthly cost of  BDT 617.94. This disparity is 
estimated to have an annual healthcare cost economy of  
BDT 18,204.24 per family. The fiscal model treats this as 
an indirect benefit ( Bh ). Economic expression: = (Cm, 
non RWH − Cm, RWH) × 12

6. Gender specific vitality burden Besides the usual 
monetary implications, the conclusions reveal significant 
gender-specific vitality burden. Restricted access to 
clean water when climate extremes force females and 
adolescents to adopt detrimental strategies, similar to 
using hormonal contraception to delay periods when 
cleanliness is poor. The current delves into, in addition 
to creating a disproportionately higher cesarean 
division (C-section) determine in the middle of  female 
respondent 72.39 % report delivering via C-section — 
significantly above the patriotic average. These data 
highlight the combined risks associated with subpar water 
entry, including maternal morbidity and underprivileged 
procreant health outcomes.

Cash Flow & Valuation
For the purpose of  assessing the monetary viability of  the 
Rain Harvesting Organization over a 20-year operating 
lifecycle, a detailed cost-benefit analysis was carried 
out. The initial purchase price was assessed in addition 
to 31,377.9 BDT, which represents an annual 0. The 
structure has been generating reliable annual bonuses 
of  74,078.8 BDT from the first quarter onwards, which 
has resulted in a steady increase in the net cash current 
beyond the limit.
Accumulated cash current of  approximately 818,300.1 
BDT per annum using a discount rate of  6 %. In contrast, 
the accumulated nominal cash flow (nay account for the 
span value of  money) amounts to 1,450,198 BDT, in 
addition to stressing the continuing monetary rewards of  
the organization. The firm achieved a repayment in less 
than one annual period, together with an accumulated 
reduction in aid which exceeded the initial stake as early 
as annually 1. This rapid repayment reflects the higher 
annual earnings stream compared to the lower capital 
costs of  implementation. As a result of  the decline in the 
annual bonus from 69 885.66 BDT a year 1 to 23,098.12 
BDT a year 20, the discounted perk beliefs have been 
gradually worsening over the course of  the fiscal year in 
order to affect the overall effect of  the widening of  the 
market value.
However, the effective cash movement remains stable and 
robust throughout the business cycle. Such discoveries, 
confirmed by a steady flow of  cash and a positive ratio 
of  benefits to costs, clearly indicate the economic viability 
and sustainability of  rain harvesting systems in the 
examined location. It significantly outperforms the initial 
costs and provides an attractive solution for household 
and community water security strategies in Bangladesh.



Pa
ge

 
23

8

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

Cumulative Cash Flow: CGFT = ∑(t=0)
TCFt

Table 1: Cumulative Cash Flow (Highlight the year NPV crosses zero (≈ year 7))

Net Present Value (NPV) 
The Net Present Value (NPV) of  switching from a non-
RWH system to a RWH system is: BDT 404,714 over a 
20-year period (at 6% discount rate). “This analysis uses 
a 6 % discount rate in accordance with the standards 
for public sector acquisitions and evaluation of  NGOs 
in Bangladesh. It takes into account moderate inflation, 
resource prospect costs, and realistic risk levels for 
household RWH undertakings. To check the robustness 
of  the findings, a sensitivity review shall be conducted 
between 4 % and 8 %. ‘It’s not about the money.”
NPV Formula:  NPV =∑ n

(t=1)(Bt/(1+r)t )
=11.47
NPV = 25619 × 11.47 = 293938.6 BDT
Approximately BDT 293,939 represents the net present 

value of  the avoided clinical costs over 20 years as a result 
of  the use of  the RWH system. Tank installation cost: 
Average cost 31377.9 BDT. They can harvest 4.14 month. 
The annual cost of  treatment: 1767.18 BDT. Max. 2990 
BDT, last 506 BDT; current includes tap, pipe damage by 
default and inherent catastrophe. So, if  this cost accounts 
for 20 years, then cost will be 35,343.6
So, NPV= 293939 – 35343.4 = 258,595.4
Inflation (5%) adjusted cost = 258,595.4 - 12929.77 = 
245,665.23
NPV = 258,595.40
Inflation rate = 5%
Time= 20 years
FV = PV ×(1 + f)n

FV = 686,134.64 

Table 3: Cost-Benefit (Yearly)
Year Inflation Adjusted Benefit Inflation Adjusted Annual Cost
0 258595.4 ------------
1 271525.17 41060.15
2 285101.43 43113.15
3 299356.5 45268.81
4 314324.32 47532.25
5 330040.54 49908.86
6 346542.57 52404.31
7 363869.7 55024.52
8 382063.18 57775.75
9 401166.34 60664.54
10 421224.66 63697.76
11 442285.89 66882.65
12 464400.18 70226.78
13 487620.19 73738.12
14 512001.2 77425.03
15 537601.26 81296.28
16 564481.33 85361.09
17 592705.39 89629.15



Pa
ge

 
23

9

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

BCR
BCR =  (∑(Bt/(1+r)t))/(∑(Ct/(1+r)t))
= PVb/PVc   
= 777180/37180
BCR ≈ 20.90

A BCR of  20.9 means:
For every BDT 1 invested in RWH, you get BDT 20.9 
in present value benefits indicating extremely strong 
financial viability.

18 622340.66 94110.61
19 653457.7 98816.14
20 686130.58 103756.9

Table 2: Annual benefit-cost ratio(BCR) over 20 years

IRR
Internal Rate of  Return IRR = 236.09%
Payback Period (Nominal & Discounted)
Time (in years) when cumulative net cash flow ≥ 0

• Nominal Payback = 1 year.
• Discounted Payback = 1 year
• The internal rate of  return (IRR) for the rain harvesting 

(RWH) framework was strategic to be approximately 
236.09 %, which is significantly above the normally used 
discount rate of  6 %. The current exceptionally high 
IRRs indicate that the venture is economically feasible, 
generating a rapid tax return on the initial investment. 
The identical tax return demonstrates that, for each legal 
tender unit invested in the RWH organization, more than 
two units of  measure are recovered annually in the form 
of  water reserves, avoidance of  water procurement, and 
related socio-economic support.

• This effect shows that the structure has been able 
to recover costs very quickly, possibly within the first 
otherwise following year of  operation, and has continued 
to provide significant net benefits throughout the 
duration of  its planned life. Although IRRs exceeding 
100% are relatively rare in Foundation undertakings, the 
result is plausible given the combination of  low initial 
investment costs, high rainfall, and uninterrupted gains 
in the analyzed area.

• However, the unusually high level of  IRR requires 
careful interpretation. It is recommended that the 
estimates remain contextualized in local situations, 
structure, and assumptions on the distribution of  
benefits and care fidelity. However, the findings strongly 

support the economic defense for a wider and wider 
RWH deployment and expansion in the water-stressed 
and salinity-prone regions of  Bangladesh.

Findings
• A comparative assessment of  100 families that do not 

use Rainwater Harvesting (RWH) systems to determine 
their water costs, era burden, and vitality impacts.

• Demographics and household characteristics 
surrounding the survey non-RWH users, 60 % were 
male-headed households and 40 % were female-headed 
households, with an average household size of  5.58 
persons.

• The economic costs relating to the purchase of  water 
by the aforementioned family amounted to BDT 1,053.64 
a month and amounted to approximately BDT 12,643.68 
a year. Furthermore, the family incurs an average monthly 
transport cost of  BDT 231.39 to transport water otherwise 
bought, compared to an annual cost of  BDT 2,776.68. 
An average of  1.69 hours a day, a total of  approximately 
20 hours and 16 minutes a month is needed to select 
water intervals. In particular, a low-income family relying 
on habitual work is subject to mandatory risk costs.

• In terms of  well-being, 76% of  respondents reported 
experiencing waterborne diseases compared to 25% who 
did not experience any. The average monthly healthcare 
costs related to waterborne illnesses amounted to BDT 
2,134.96 or approximately BDT 25,619.52 per year.

• The total annual cost of  purchasing, transporting, 
and treating water, non-reverse hydrant users face an 
average annual cost of  BDT 41,060.15 is a reminder 



Pa
ge

 
24

0

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

of  the significant fiscal burden on accessing safe water 
without rain harvesting structures.

• Users of  RWH in maritime Bangladesh have high 
fiscal and time costs related to water procurement and a 
significant health burden due to waterborne diseases. The 

above discoveries highlight the urgent need to improve 
access to water, such as RWH arrangements, which can 
reduce economic strain, reduce the incidence of  diseases, 
and allow the free tenure of  productive projects.

Table 4: 
Parameter RWH Users (Average) Non-RWH Users (Average)
Installation Cost BDT 31,377.90 (one-time) N/A
Annual Maintenance Cost BDT 1,767.18 N/A
Annual Water Savings BDT 4,864.60 N/A
Monthly Water Purchase Cost Minimal/Zero (harvested) BDT 1,053.64
Monthly Transportation Cost Minimal BDT 231.39
Annual Water & Transport Cost Low (included in savings) BDT 15,420.36
Annual Medical Cost BDT 617.94 (monthly) BDT 2,134.96 (monthly)
Time Spent Collecting Water Not significant (on-site) ~1.69 hours daily (20h 16m 

monthly)
Waterborne Diseases Majority unaware if  RWH reduced 

medical costs (65%) but 26% reported 
reduction

76% reported waterborne diseases

Medical Expenses BDT 617.94 monthly BDT 2,134.96 monthly
Recommendation of  RWH 93% Yes N/A
Intent to Expand RWH 28% Yes N/A

CONCLUSION
This study shows that household-level rainwater 
harvesting systems are a financially sound and socially 
advantageous adaptation strategy for addressing water 
insecurity in coastal regions of  Bangladesh. The findings 
indicate that the adoption of  rainwater harvesting notably 
lowers household water expenses, alleviates health-
related expenditures, and diminishes the considerable 
opportunity costs tied to water collection, especially 
for women and low-income individuals. The findings 
are consistent with current literature, suggesting that 
rainwater harvesting systems can improve water security 
and alleviate the socio-economic challenges caused by 
climate-induced salinity and groundwater degradation. 
The economic evaluation reinforces the long-term 
financial sustainability of  RWH systems, showcasing high 
internal rates of  return, favorable net present values, and 
payback periods that are competitive with similar studies 
in South Asia. The interplay of  direct financial savings, 
decreased disease occurrence, and enhanced household 
efficiency highlights the extensive developmental 
possibilities of  rainwater harvesting, extending far 
beyond mere water supply. Overall, the results indicate 
that RWH systems can play a critical role in strengthening 
climate resilience in vulnerable coastal communities. The 
demonstrated economic and social benefits highlight 
the need for policy interventions that support wider 
adoption, including targeted subsidies for low-income 
households, community-based training on system 
management, and integration of  RWH within local and 
national climate adaptation frameworks. Future research 

should examine long-term system performance across 
diverse climatic conditions and assess the institutional 
factors that influence sustained RWH utilisation. Through 
coordinated policy and programmatic support, RWH 
can contribute meaningfully to Bangladesh’s broader 
objectives for water security, public health improvement, 
and climate adaptation.

REFERENCES
Ahmed, K. M., Hasan, M. A., & Bhuiyan, M. A. H. 

(2002). Arsenic contamination in groundwater 
of  alluvial aquifers in Bangladesh: An overview. 
Applied Geochemistry, 17(3), 297–323. https://doi.
org/10.1016/S0883-2927(01)00082-4

Aladenola, O. O., & Adeboye, O. B. (2010). Assessing 
the potential for rainwater harvesting. Water Resources 
Management, 24(10), 2129–2137. https://doi.
org/10.1007/s11269-009-9542-y

Alam, M. S., & Sultana, S. (2020). Potential of  rainwater 
harvesting in coastal areas of  Bangladesh: A case 
study of  Satkhira district. Environment and Ecology 
Research, 8(2), 37–44. https://doi.org/10.13189/
eer.2020.080202

Amin, M. T., Han, M. Y., & Laskar, A. (2014). Water reuse 
and sustainability: A review of  rainwater harvesting 
systems. Resources, Conservation and Recycling, 86, 95–104. 
https://doi.org/10.1016/j.resconrec.2014.02.002

Amin, R., & Rahman, M. M. (2011). Community-based 
rainwater harvesting for sustainable drinking water 
supply in Bangladesh. Sustainable Water Resources 
Management, 2(1), 31–40.



Pa
ge

 
24

1

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

Ansari, F. A., & Khan, R. A. (2018). Rainwater 
harvesting potential assessment for sustainable water 
management in a rapidly urbanizing area. Water Science 
and Technology: Water Supply, 18(4), 1184–1194. https://
doi.org/10.2166/ws.2017.185

Baguma, D., Loiskandl, W., & Jung, H. (2010). Water 
availability analysis in small rainwater harvesting 
systems in sub-Saharan Africa. Water Resources 
Management, 24(2), 401–420.

Basinger, M., Montalto, F., & Lall, U. (2010). A 
rainwater harvesting system reliability model based 
on nonparametric stochastic rainfall generation. 
Journal of  Hydrology, 392(1–2), 105–118. https://doi.
org/10.1016/j.jhydrol.2010.08.009

Biswas, A. K. (2010). Water for sustainable development 
in Bangladesh. Water Resources Development, 26(2), 193–
205. https://doi.org/10.1080/07900621003769806

Campisano, A., Butler, D., Ward, S., Burns, M. J., Friedler, 
E., DeBusk, K., ... Han, M. (2017). Urban rainwater 
harvesting systems: Research, implementation and 
future prospects. Water Research, 115, 195–209. 
https://doi.org/10.1016/j.watres.2017.02.056

Chaudhary, P., & Sharma, M. (2019). Economic viability 
of  rainwater harvesting systems in urban areas: A 
review. Journal of  Environmental Management, 232, 198–
207. https://doi.org/10.1016/j.jenvman.2018.11.050

Chowdhury, M. A. I., & Rahman, A. (2021). Estimating 
the benefit–cost ratio of  rainwater harvesting in 
peri-urban Bangladesh. Journal of  Water, Sanitation and 
Hygiene for Development, 11(3), 370–380.

Coombes, P. J., & Kuczera, G. (2003). Analysis of  the 
performance of  rainwater tanks in Australian capital 
cities. Urban Water, 1(4), 293–303.

Dutta, D., & Panda, R. K. (2016). Assessment of  rooftop 
rainwater harvesting potential and its economic 
feasibility for sustainable water management in a sub-
humid region. Journal of  Cleaner Production, 137, 1484–
1494. https://doi.org/10.1016/j.jclepro.2016.08.064

Farahani, M., Tabatabaee, S. M., & Ghoddousi, R. (2010). 
Economic analysis of  rainwater harvesting systems 
for residential houses. Desalination and Water Treatment, 
21(1–3), 205–210. https://doi.org/10.5004/
dwt.2010.1082

Fewkes, A. (2000). Modelling the performance of  
rainwater collection systems: Towards a general 
approach. Urban Water, 1(4), 323–333.

Ghisi, E., & Oliveira, S. M. (2007). Potential for potable 
water savings by using rainwater in the residential sector 
of  Brazil. Building and Environment, 42(4), 1654–1666.

Gould, J., & Nissen-Petersen, E. (1999). Rainwater catchment 
systems for domestic supply. Intermediate Technology 
Publications.

Haque, A., & Islam, K. T. (2018). A cost–benefit analysis 
of  rainwater harvesting in Dhaka City, Bangladesh. 
Journal of  Environmental Planning and Management, 
61(13), 2384–2400. https://doi.org/10.1080/096405
68.2017.1394270

Haque, M. I., & Rahman, M. M. (2014). Economic viability 

of  rainwater harvesting in Dhaka city. International 
Journal of  Environmental Science and Development, 5(6), 560–
563. https://doi.org/10.7763/IJESD.2014.V5.541

Imteaz, M. A., & Rahman, A. (2011). Rainwater 
harvesting in a changing climate: A case study of  
Sydney, Australia. Resources, Conservation and Recycling, 
55(12), 1269–1278. https://doi.org/10.1016/j.
resconrec.2011.08.005

Islam, M. S., & Afrin, S. (2022). Rainwater harvesting in 
climate-vulnerable areas: A case study from southern 
Bangladesh. Water Policy, 24(2), 247–261.

Jamali, B., Bach, P. M., & Deletic, A. (2021). Urban water 
efficiency with rainwater harvesting: A global review 
of  cost–benefit and impacts. Environmental Modelling 
& Software, 136, 104933. https://doi.org/10.1016/j.
envsoft.2020.104933

Jones, M. P., & Hunt, W. F. (2010). Performance of  
rainwater harvesting systems in the southeastern 
United States. Resources, Conservation and Recycling, 
54(10), 623–629.

Kamruzzaman, M., & Saha, S. K. (2023). Household 
rainwater harvesting adoption and willingness to 
pay: Evidence from southern Bangladesh. Resources, 
Conservation and Recycling, 189, 106738.

Karatas, M. (2018). Optimal sizing and operation of  
rainwater harvesting systems. Journal of  Water Resources 
Planning and Management, 144(10), 04018063. https://
doi.org/10.1061/(ASCE)WR.1943-5452.0000965

Kim, R. H., Lee, S., & Kim, J. O. (2012). Economic 
analysis of  rainwater harvesting systems in South 
Korea. Water Science and Technology, 66(9), 1982–1989.

Kumar, M. D. (2004). Roof  rainwater harvesting for 
domestic water security: Who gains and who loses? 
Water International, 29(1), 43–53.

Liaw, C. H., & Tsai, Y. F. (2004). Feasibility study of  
rainwater harvesting for domestic use in Taiwan. 
Journal of  Environmental Management, 73(4), 319–329. 
https://doi.org/10.1016/j.jenvman.2004.07.009

Mahmood, M. R., & Chowdhury, M. A. I. (2017). 
Feasibility study of  rainwater harvesting in rural 
Bangladesh: A CBA approach. International Journal of  
Sustainable Built Environment, 6(1), 1–9.

Meera, V., & Ahammed, M. M. (2006). Water quality 
of  rooftop rainwater harvesting systems: A review. 
Journal of  Water Supply: Research and Technology—
AQUA, 55(4), 257–268.

Muthukumaran, S., & Baskaran, K. (2013). Rainwater 
harvesting systems in buildings: A review of  design 
and performance. Sustainable Cities and Society, 7, 89–
99. https://doi.org/10.1016/j.scs.2012.11.002

Ngigi, S. N. (2003). Rainwater harvesting for improved food 
security: Promising technologies in the Greater Horn of  Africa. 
Greater Horn of  Africa Rainwater Partnership.

Pathak, N., & Heijnen, H. (2006). Rainwater harvesting for 
domestic water security: Technical, social and economic aspects. 
The World Bank & IRC.

Rahman, A., & Imteaz, M. A. (2011). Rainwater harvesting 
in Bangladesh: Challenges and opportunities. Water 



Pa
ge

 
24

2

https://journals.e-palli.com/home/index.php/ajee

Am. J. Environ Econ. 4(1) 233-242, 2025

and Environment Journal, 25(2), 263–271. https://doi.
org/10.1111/j.1747-6593.2010.00222.x

Rahman, A., Dbais, J., & Imteaz, M. (2012). Sustainability 
of  rainwater harvesting systems in multistoried 
buildings of  Dhaka, Bangladesh. Resources, Conservation 
and Recycling, 65, 112–119.

Sazakli, E., Alexopoulos, A., & Leotsinidis, M. (2007). 
Rainwater harvesting, quality assessment, and 
utilization in Kefalonia Island, Greece. Water Research, 
41(9), 2039–2047.

Shaikh, B. T., & Hatcher, L. (2005). Rainwater harvesting 
as a sustainable water source in rural Pakistan: A case 
study. Journal of  Rural Studies, 21(3), 329–338. https://
doi.org/10.1016/j.jrurstud.2005.02.003

Sharma, S. K., & Gupta, A. (2019). Impact of  climate 
change on rainwater harvesting potential: A global 
perspective. Water Resources Management, 33(1), 301–
315. https://doi.org/10.1007/s11269-018-2089-y

Sobreyra, C. E., & Piza-Aguilar, V. (2019). Socioeconomic 

factors influencing the adoption of  rainwater 
harvesting systems: A case study in Mexico. Water 
Resources and Rural Development, 14, 100069. https://
doi.org/10.1016/j.wrr.2019.100069

Sultana, S., & Rahman, M. M. (2016). Assessment of  
water quality of  harvested rainwater in selected 
coastal areas of  Bangladesh. Journal of  Environmental 
Science and Engineering, 58(1), 1–8.

Tabor, M. N., & DeGraff, J. V. (2013). Cost–benefit 
analysis of  household RWH system installation in 
rural Honduras. Water Practice and Technology, 8(3), 
536–543.

Thomas, T. H., & Martinson, D. B. (2007). Roofwater 
harvesting: A handbook for practitioners. IRC International 
Water and Sanitation Centre.

Zhang, Y., Huang, H., & Yu, W. (2020). Performance 
analysis of  rainwater harvesting systems for different 
building types. Building and Environment, 173, 106757. 
https://doi.org/10.1016/j.buildenv.2020.106757


