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Water pricing for sustainability and the poor
David ZetlandSenior water economist Wageningen
University The Netherlands
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Traditional water pricing...

• Covers some or all O M costs
• Do not reflect externalities
• Do not usually recover capital costs
• Political pressure to keep prices low
• Operator desire to minimize spending

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Full cost pricing is sustainable

• Will reflect scarcity and system costs
• People decide to use less or more
• Rebate excess per person or meter

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Full cost pricing is fair

• Social tariffs are hard to target
• Failure to provide service (LDCs)
• Diversion from poor to rich

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Suggestions

• Prices that exceed cash costs
• Regulation for local conditions
• Social income transfers to the poor
• Independent of other policies (nexus)
• One priority Allow private/public corporate
  water companies to serve customers without
  political interference

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Thank you!
Blog aguanomics.com Book endofabundance.com Data
WaterDataHub.org Contact dzetland_at_gmail.com
This research project has received funding from
the European Community's Seventh Framework
Programme (FP7/2007-2013) / grant agreement
265213 Project EPI-WATER Evaluating Economic
Policy Instrument for Sustainable Water
Management in Europe