Sustainable water use, Water pricing, Demand management, Efficient water use
Abstract
As the scarcity of water resources is intensified, water policy gathers a continuously increasing interest. A dominant factor in an effective policy on water resources is the correct pricing of water use. The present paper examines the pricing systems of the urban usage of water resources. At the beginning, the paper systemalicaliy presents a simple economic analysis that first underlies effective pricing and seconds the effects of under pricing water use. Some new elements are presented to facilitate empirical data and existing information in real world. Afterwards, the systems of pricing and managing water use in five European cities are examined and compared to the analytical model of effective pricing that was derived from the economic analysis. The conclusion is that in the majority of cases, one way or another, the existing prices are lower than the effective prices of water. As a result, the use of water, in all indicative case cities, exceeds the optimum socioeconomic level and unsustainable use prevails.
