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What is the difference between Capital Expenditure and Capital Maintenance Expenditure?

I am trying to answer the question on capital and recurrent expenditure in the WASHCost calculator. Could somebody clarify this for me?

1 Answer


The difference between capital expenditure and capital maintenance expenditure is:

Capital expenditure are the costs of constructing a new water or sanitation system or expanding an existing system to provide a service to new additional users. If the system that you are constructing or the people that you are providing the service to are new, it is capital expenditure.

Capital expenditure also includes 'software' costs such as the costs of one-off work with stakeholders prior to construction or implementation, extension, enhancement and augmentation (including costs of one-off capacity building). An example of CapEx software would be the cost of holding a meeting to explain alternative systems to users. Investment costs also include ‘household coping costs’ by which households spend their own money on, for example, storage tanks or water filters to achieve a satisfactory level of service.

Capital maintenance expenditure (CapManEx) are the cost to renew, replace and rehabilitate an existing water or sanitation system in order for the system to keep providing a basic level of service to users.

To explain this with the metaphor of a car; capital expenditure are the costs of buying a car. Capital maintenance expenditure are the costs of buying a new engine or gearbox for the car after 12 years in order to keep the car running. Operational and minor maintenance expenditure are the costs of buying fuel for the car in order to drive the car.

I hope this clarifies your question. Alternatively, you can also follow module 1 of the free Costing Sustainable Services online course where this is explained in detail with step-by step- guides, exercises and tools to help you. To register for the Costing Sustainable Services online course, go to

In the WASHCost calculator you can fill in capital expenditure in question 4; 'How much has been/will be spent setting up the water service including construction (per person)?'

In the WASHCost calculator capital maintenance expenditure is part of questions 5 on recurrent costs; 'How much is being spent/will be spent to operate, maintain and support the delivery of water services (per person per year)?'