Many of the water sectors in developing countries are facing challenges and obstacles in providing potable water to their customers. These challenges resulted from many reasons such as; shortage of water, huge population, low water tariff, regulations, unplanned development, shortage of financing, absence of commercial orientation and others. Therefore, these sectors are requested to work innovatively to overcome these problems and find out proper solutions. One effective option to address these challenges is appropriate pricing of water. Setting up appropriate water price aims to recover service cost, reduce rate of subsidy and achieve financial sustainability. This research was carried out to determine how to achieve financial sustainability in the water sector in the Sultanate of Oman. The study is based on three main issues, improving the water tariff structure, the role of the customer and his expectation to increase the chance of financial sustainability. Two stages of qualitative and quantitative data collection methods were adopted in order to answer the research question. 22 semi-structured interviews were conducted with PAEW key staff and other relevant parties outside PAEW. 610 quantitative surveys were returned from a total of 1600 PAEW customers to get their views about the role of the customer and his expectations of PAEW in order to increase the chance of financial sustainability. Findings from qualitative data showed the appropriate water tariff is the cost reflective tariff which increases the chance of financial sustainability and cost recovery. The quantitative findings present the willingness of customers’ participation and his expectation. Customer participation is expressed in three main roles: leakage and defect reporting, payment and conservation. In all of these, the research outcomes prove the role of the customer and the importance of these roles to increase the chance of financial sustainability. Customer expectations are expressed in customer service, billing system and water service. The outcomes reflect the customer expectations in terms of satisfaction and identify the gap that should be filled by PAEW to make the customer satisfied and loyal.

Many of the water sectors in developing countries are facing challenges and obstacles in providing potable water to their customers. These challenges resulted from many reasons such as; shortage of water, huge population, low water tariff, regulations, unplanned development, shortage of financing...