in the North of Armenia. The contract, signed in August 2009, is held by the German company MVV. The project is supported by German development cooperation through KfW development Bank. Objectives and impact The main objectives of the management contracts are to increase the continuity of supply, metering and revenue collection, as well as to reduce water losses and energy consumption. Increasing access to piped water supply was not an objective of the contracts. In Yerevan, the impact of the management contract from 1999 to 2005 was largely positive. In particular: Average continuity of water supply increased from about 7 hours to about 18.5 hours a day, and more than 70 percent of Yerevan's inhabitants received continuous service in 2005; Energy consumption decreased by about 48 percent, compared to a targeted decrease by 20 percent, as a result of using gravity powered water sources, increased efficiency and reduction in the number of booster pumps for high rise apartments; The share of connections with a water meter increased from 10 percent to 80 percent or 277,000 meters, far in excess of the contractual target of increasing the number of metered connections by 20,000; Collection efficiency – the share of bills paid compared to bills issued – increased from 19% (according to the World Bank) or 40% (according to the Asian Development Bank) to 80%. Revenue collection and metering had remained low until the government passed the Water Code in 2002. The Code allowed utilities to partially forgive debt from unpaid bills in return for meter installation. Customers then paid the remainder of the unpaid bills in installments. Improved continuity of supply also helped customers to accept metering and tariff increases. The code also allowed cutting off non-paying customers. The improvement in collection efficiency and metering thus is not only due to private sector participation, but also to a change in government policy. In the area served by the Armenia Water and Sewerage Company, within the first 2.5 years, the management contractor increased revenue collection by 24%; decreased energy costs by 15% and water losses by 20%. The number of metered connections was increased by 76%. Tariffs and affordability In Yerevan the tariff was increased in 2000 from the equivalent of $0.10/m3 to Armenian Dram (AMD) 56 ($0.18)/m3 including value-added tax. In April 2004, in preparation for the lease contract, tariffs were increased to AMD 90.2 ($0.29)/m3 and again in May 2005,