EVALUATION OF ECONOMY, EFFICIENCY, AND EFFECTIVENESS IN THE MANAGEMENT OF OPERATIONAL COSTS OF A REGIONAL PUBLIC WATER UTILITY COMPANY THROUGH THE VALUE FOR MONEY APPROACH (A STUDY AT PERUMDA AIR MINUM TIRTA KARAJAE, PAREPARE CITY)
Indonesia Indonesia Indonesia Indonesia 
Article Sidebar
-
Economy, Efficiency, Effectiveness
Abstract
This study aims to evaluate the operational cost performance of a regional water utility enterprise, using PERUMDA Air Minum Tirta Karajae Kota Parepare as a case study, through the Value for Money (VfM) approach for the 2021-2025 period, covering the level of economy, efficiency, and effectiveness. This research applies a quantitative descriptive method using secondary data in the form of income statements, budget reports, customer data, and water production and distribution reports. Data were analyzed by calculating the economy, efficiency, and effectiveness ratios based on the realization and budget of operational costs and operating revenue. The results show that the economy ratio averaged 98.23%, categorized as very economical, although a deviation occurred in 2023. The efficiency ratio averaged 106.18%, indicating that operational costs generally exceeded operating revenue. The effectiveness ratio averaged 93.21%, indicating that revenue realization has not yet reached the budgeted target, despite improvements in non-financial indicators such as customer growth and reduced non-revenue water. Overall, the performance of the regional water utility has not fully achieved the ideal 3E condition (Economy, Efficiency, Effectiveness), indicating the need for stronger operational cost control and more realistic revenue target setting.
Full text article
References
Adebayo, T. S. (2023). Role of country risks and renewable energy consumption on environmental quality: Evidence from MINT countries. Journal of Environmental Management, 327(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.jenvman.2022.116884
Alola, A. A. (2023). The potency of resource efficiency and environmental technologies in carbon neutrality target for Finland. Journal of Cleaner Production, 389(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.jclepro.2023.136127
Amir, S. (2023). Towards circular economy: A guiding framework for circular supply chain implementation. Business Strategy and the Environment, 32(6), 2684–2701. https://doi.org/10.1002/bse.3264
Anu. (2023). Role of financial inclusion, green innovation, and energy efficiency for environmental performance? Evidence from developed and emerging economies in the lens of sustainable development. Structural Change and Economic Dynamics, 64(Query date: 2026-10-27 19:24:30), 213–224. https://doi.org/10.1016/j.strueco.2022.12.008
Binnemans, K. (2023). The Twelve Principles of Circular Hydrometallurgy. Journal of Sustainable Metallurgy, 9(1), 1–25. https://doi.org/10.1007/s40831-022-00636-3
Breyer, C. (2024). The role of electricity-based hydrogen in the emerging power-to-X economy. International Journal of Hydrogen Energy, 49(Query date: 2026-10-27 19:24:30), 351–359. https://doi.org/10.1016/j.ijhydene.2023.08.170
Chang, K. (2024). The impact of green finance policy on green innovation performance: Evidence from Chinese heavily polluting enterprises. Journal of Environmental Management, 352(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.jenvman.2023.119961
Chen, W. (2024). The need for energy efficiency and economic prosperity in a sustainable environment. Gondwana Research, 127(Query date: 2026-10-27 19:24:30), 22–35. https://doi.org/10.1016/j.gr.2023.03.025
Cheng, Y. (2023). The effect of digital transformation on real economy enterprises’ total factor productivity. International Review of Economics and Finance, 85(Query date: 2026-10-27 19:24:30), 488–501. https://doi.org/10.1016/j.iref.2023.02.007
Chioatto, E. (2023). Transition from waste management to circular economy: The European Union roadmap. Environment Development and Sustainability, 25(1), 249–276. https://doi.org/10.1007/s10668-021-02050-3
Curcio, E. (2025). Techno-economic analysis of hydrogen production: Costs, policies, and scalability in the transition to net-zero. International Journal of Hydrogen Energy, 128(Query date: 2026-10-27 19:24:30), 473–487. https://doi.org/10.1016/j.ijhydene.2025.04.013
Dwivedi, A. (2023). Studying the interactions among Industry 5.0 and circular supply chain: Towards attaining sustainable development. Computers and Industrial Engineering, 176(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.cie.2022.108927
Farghali, M. (2024). Strategies for ammonia recovery from wastewater: A review. Environmental Chemistry Letters, 22(6), 2699–2751. https://doi.org/10.1007/s10311-024-01768-6
Hegab, H. (2023). Toward sustainable future: Strategies, indicators, and challenges for implementing sustainable production systems. Sustainable Materials and Technologies, 36(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.susmat.2023.e00617
Jones, A. M. (2024). The fourth dimension: Physiological resilience as an independent determinant of endurance exercise performance. Journal of Physiology, 602(17), 4113–4128. https://doi.org/10.1113/JP284205
Jorge, A. M. S. (2023). Textile dyes effluents: A current scenario and the use of aqueous biphasic systems for the recovery of dyes. Journal of Water Process Engineering, 55(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.jwpe.2023.104125
Khan, S. (2023). The impact of silver nanoparticles on the growth of plants: The agriculture applications. Heliyon, 9(6). https://doi.org/10.1016/j.heliyon.2023.e16928
Lee, J. (2023). Smart city as a social transition towards inclusive development through technology: A tale of four smart cities. International Journal of Urban Sciences, 27(Query date: 2026-10-27 19:24:30), 75–100. https://doi.org/10.1080/12265934.2022.2074076
Lin, J. (2024). Tandem microplastic degradation and hydrogen production by hierarchical carbon nitride-supported single-atom iron catalysts. Nature Communications, 15(1). https://doi.org/10.1038/s41467-024-53055-1
Luo, J. (2024). The Optimization of Carbon Emission Prediction in Low Carbon Energy Economy under Big Data. IEEE Access, 12(Query date: 2026-10-27 19:24:30), 14690–14702. https://doi.org/10.1109/ACCESS.2024.3351468
McGrath, S. (2023). Skills for development and vocational education and training: Current and emergent trends. International Journal of Educational Development, 102(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.ijedudev.2023.102853
Mohammed, A. S. (2023). Review of optimal sizing and power management strategies for fuel cell/battery/super capacitor hybrid electric vehicles. Energy Reports, 9(Query date: 2026-10-27 19:24:30), 2213–2228. https://doi.org/10.1016/j.egyr.2023.01.042
Rath, K. C. (2024). The Role of Internet of Things (IoT) Technology in Industry 4.0 Economy. Advanced Iot Technologies and Applications in the Industry 4 0 Digital Economy, (Query date: 2026-10-27 19:24:30), 1–28. https://doi.org/10.1201/9781003434269-1
Shah, W. U. H. (2024). Role of renewable, non-renewable energy consumption and carbon emission in energy efficiency and productivity change: Evidence from G20 economies. Geoscience Frontiers, 15(4). https://doi.org/10.1016/j.gsf.2023.101631
Song, A. (2024). Towards a greener future: How green technology innovation and energy efficiency are transforming sustainability. Energy, 290(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.energy.2023.129891
Tan, L. (2024). Toward low-carbon sustainable development: Exploring the impact of digital economy development and industrial restructuring. Business Strategy and the Environment, 33(3), 2159–2172. https://doi.org/10.1002/bse.3584
Wang, D. (2024). Research on the impact of digital transformation on the production efficiency of manufacturing enterprises: Institution-based analysis of the threshold effect. International Review of Economics and Finance, 91(Query date: 2026-10-27 19:24:30), 883–897. https://doi.org/10.1016/j.iref.2024.01.046
Zhao, L. (2023). Role of natural resources utilization efficiency in achieving green economic recovery: Evidence from BRICS countries. Resources Policy, 80(Query date: 2026-10-27 19:24:30). https://doi.org/10.1016/j.resourpol.2022.103164
