Should Water be priced according to scarcity?

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In our earlier discussion Donna suggested that perhaps water should be priced in line with scarcity. This could force energy generators to either pay more or find alternatives. What do you think?

5 Answers

  1. Such a tariff structure was in operation way back in 1981 (long time ago!) in Thailand when I undertook a study of the potential for EE & RE there for the government.

    1 Comment

    1. How interesting Brian! I wonder if Thailand has retained such a tariff structure in the race for 'development'now? and it would also be very interesting to know if there are similar examples from developed countries...

  2. Yes, provided you ensure that a varied tariff structure is incorporated with lifeline rates for the poorest (assessed by some form of appropriate means test).

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    1. Do we know any current examples of such a differential tariff structure w.r.t water/energy use in any place?

  3. It would be a good idea. But have stopped to think who would be hardest hit by the innovation? The common people, most of whom cannot get two meals any day of the year and earn less than a dollar per day!! The proposal would encourage energy production companies to increase incessantly the power rates hence many poor and SMEs that rely on power would close shop hence suffering. other means of energy production, wind energy, solid waste matter, solar energy, etc can be explored and spare the water levels.

  4. Pricing water in line with scarcity is a good idea. However the moment energy generators will start paying water price , the cost of generated energy will increase automatically. There must be some balance so that natural resources can be saved but consumers do not have to pay extra. An alternative could be impose/increase of environmental tax in lieu of reduction in income tax.