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THE EFFECTWENESS OF PRICING AS A STAND‐ALONE WATER CONSERVATION PROGRAM 1
Author(s) -
Jordan Jeffrey L.
Publication year - 1994
Publication title -
jawra journal of the american water resources association
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.957
H-Index - 105
eISSN - 1752-1688
pISSN - 1093-474X
DOI - 10.1111/j.1752-1688.1994.tb03335.x
Subject(s) - water conservation , incentive , environmental science , agricultural economics , water consumption , consumption (sociology) , economics , natural resource economics , water resources , water resource management , ecology , microeconomics , social science , sociology , biology
ABSTRACT: Economic theory clearly indicates that the use of increasing rate structures will reduce the demand for water and produce monetary incentives for consumers to conserve. One problem with estimating the effectiveness of using rate structures as a conservation program is that they are usually accompanied by other conservation efforts. Thus, it is difficult to determine the effectiveness of any one conservation component. This paper examines the effectiveness of increasing rate structures in a situation where no other conservation program was introduced. The paper uses customer data from the Spalding County (Georgia) Water Authority where an increasing rate structure replaced a descending rate structure in January 1991. Since the imposition of the increasing rate structure, the number of customers has increased 21 percent while total water demand has gone up only 15 percent and per customer water use has declined 5 percent. The daily water use per connection has declined from 243 gallons in 1990 to 231 in 1993, and monthly use has gone from 7,381 gallons to 7,028 per connection over the same period. Statistical tests indicate that water consumption during the two periods was significantly different while weather factors were not.