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Urban water policy when environment inflows are uncertain

Sibly, A ORCID: 0000-0003-0271-7710 2019 , 'Urban water policy when environment inflows are uncertain' , Water Resources and Economics , pp. 1-13 , doi: 10.1016/j.wre.2019.100149.

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Abstract

An urban water network with storage and uncertain environmental water inflows is modelled.This three period model is analytically tractable, and allows for a straightforward study of therelative economic impact of different policy regimes. The model is used to identify the waterauthority's first best pricing policy, and its relation to long run marginal cost pricing. The modelis then used to identify the implications of adopting the most commonly used rationing method when environmental flows are uncertain: setting a smoothed priced (often LRMC exclusive of scarcity value) and using moral suasion, rather than pricing, to control the demand for water. The optimal manner to address water security is also addressed.

Item Type: Article
Authors/Creators:Sibly, A
Keywords: efficient urban water pricing, moral suasion, environmental uncertainty, storage levels
Journal or Publication Title: Water Resources and Economics
Publisher: Elsevier BV
ISSN: 2212-4284
DOI / ID Number: 10.1016/j.wre.2019.100149
Copyright Information:

© 2019 Published by Elsevier B.V.

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