Environmental coalition calls for full-cost pricing of water

September 1, 2009

A coalition of environmental organizations and water associations is calling on Ontario to encourage volume-based water pricing to promote conservation.

H2Ontario: A Blueprint for a Comprehensive Water Conservation Strategy, released in August, calls for a "market transformation" that will embed in the economy "the right signals" for citizens, businesses, and communities. It urges the province to do three things to bring about such a transformation: mandate meters; move towards full-cost and volume-based pricing; and increase water charges for water users.

The report advises the province to review municipalities’ financial plans for water provision. If the province finds that most urban communities lack plans for full-cost and volume-based pricing, it should "develop a plan of action to ensure implementation of full cost and volume based pricing in these communities." The authors suggest giving special consideration to small, low-income, northern, or First Nations communities to avoid undue hardship.

Unfortunately, the report does not suggest that the full cost of drinking water should include a charge for the water itself. It recommends increased water charges only for "non-essential" industrial and commercial users, including mining, pulp and paper, and thermal power generation. The authors’ position on water charges for agriculture – generally, a highly consumptive use – is unclear. On one hand, they recommend increasing water charges for highly consumptive users; on the other, they maintain that water charges should not apply to "the minimum water necessary for … food."

In their discussion of a market transformation, the authors envision a world in which conservation is an easy, automatic part of our daily interaction with water – one in which businesses have incentives to develop and deliver innovative and cost-effective water-saving solutions and newly aware citizens do their part in their homes and workplaces.

And yet, despite their confidence in the power of metering and pricing to transform our water use, the authors seem not to fully appreciate the implication of these policies – most obviously, that full metering and proper pricing will obviate the need for a number of recommended conservation measures, such as mandating water efficient landscapes for new homes and banning 13 litre toilets. We know that consumers respond to prices. Why not price water properly, and then let consumers decide how best to use it?

 

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