How to put a price on wa­ter

The China Post - - LIFE - BY GILES HE­WITT

It’s ar­guably our most vi­tal and pre­cious nat­u­ral re­source, and one that is grow­ing dan­ger­ously scarce from China to Cal­i­for­nia, but no mat­ter how much we value wa­ter, we’re not that keen on pay­ing for it.

The is­sue of pric­ing wa­ter is ex­tremely sen­si­tive — so­cially, po­lit­i­cally, eco­nom­i­cally — but it’s an is­sue that is be­ing re­vis­ited with in­creas­ing fre­quency as warn­ings of a loom­ing global cri­sis over wa­ter scarcity grow louder.

A re­cent ed­i­to­rial in The Econ­o­mist and an op-ed piece in the New York Times — on China’s and Cal­i­for­nia’s chronic wa­ter short­ages re­spec­tively — both in­sisted that the best way for­ward was to raise prices.

The sug­ges­tion raises the hack­les of those who feel pric­ing public wa­ter is tan­ta­mount to mon­e­tiz­ing na­ture, while oth­ers say there is sim­ply no al­ter­na­tive given U.N. es­ti­mates that the world will face a 40 per­cent “global wa­ter deficit” by 2030.

“If you have an ar­ti­fi­cially low price for a prod­uct, you tend to con­sume more of it and tend not to give it im­por­tance,” said An­gel Gur­ria, sec­re­tary gen­eral of the Or­ga­ni­za­tion for Eco­nomic Co­op­er­a­tion and Devel­op­ment (OECD).

“It’s hu­man na­ture. You give some­thing away, peo­ple will take it for granted, waste it and not ap- pre­ci­ate it,” Gur­ria told AFP in the South Korean city of Daegu where he was at­tend­ing the World Wa­ter Fo­rum — a seven-day gath­er­ing of pol­i­cy­mak­ers, cor­po­ra­tions and NGOs.

Nearly ev­ery­one who is con­nected to a wa­ter net­work pays some­thing, but at hugely sub­si­dized rates.

Chang­ing Be­hav­ior

The ar­gu­ment for rais­ing the tar­iff is that it would make con­sumers less prof­li­gate and pro­vide in­come for util­ity com­pa­nies to in­vest in more ef­fi­cient net­works.

Out­dated, de­crepit dis­tri­bu­tion sys­tems in many de­vel­oped na­tions are as­ton­ish­ingly waste­ful, with the U.S. Ge­o­log­i­cal Sur­vey es­ti­mat­ing drink­ing wa­ter losses in the U.S. at 1.7 tril­lion gal­lons a year.

But up­grades and retrofits are ex­pen­sive, and the util­i­ties gen­er­ally don’t have the nec­es­sary funds.

Wa­ter bills are so low that they barely reg­is­ter with mid­dle class con­sumers, but Ger Bergkamp, ex­ec­u­tive direc­tor of the In­ter­na­tional Wa­ter As­so­ci­a­tion, warned against un­der­es­ti­mat­ing the “emo­tional value” peo­ple at­tach to wa­ter.

“You’d need to do a lot with the price to change be­hav­ior. But any­one who says ‘ok, let’s whack it up 10 times and be done’ is go­ing to face a revo­lu­tion,” Bergkamp said.

It stopped short of a full-fledged re­bel­lion, but tens of thou­sands of peo­ple took to the streets of the Ir­ish cap­i­tal Dublin last month to protest new wa­ter charges.

NGOs ded­i­cated to get­ting drink­ing wa­ter and san­i­ta­tion to the most needy are largely skep­ti­cal about the ef­fec­tive­ness of tar­iffs as a con­ser­va­tion tool, although they don’t rule out the need for pric­ing.

“Wa­ter is a right, but then so is food and when you go to restau­rant you get a bill,” said Ca­t­rina de Al­bu­querque, vice chair of San­i­ta­tion and Wa­ter for All.

‘Af­ford­abil­ity for all’

“The is­sue is re­ally about af­ford­abil­ity for all, and the big chal­lenge is how you en­sure af­ford­abil­ity and sus­tain­abil­ity of the ser­vice,” she said.

Iron­i­cally, it is those with the least ac­cess to wa­ter who of­ten end up be­ing charged the most for it.

In the cities of most de­vel­op­ing coun­tries, the ma­jor­ity of peo­ple con­nected to a mains net­work and pay­ing sub­si­dized rates for their wa­ter are the mid­dle to up­per class.

The rest have to find other sources, of­ten un­reg­u­lated sec­ondary ven­dors who may have il­le­gally tapped into the mains and who charge what they like.


A per­son jumps over a pud­dle near Main St. in Salt Lake City, Utah on Wed­nes­day, April 15. A spring storm has dumped 2.3 inches (5.84 cen­time­ters) of snow in Salt Lake City af­ter the win­ter proved to be the least snowy ever recorded.

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