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Bringing competition to urban water supply

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Author Info

  • Hugh Sibly
  • Richard Tooth

Abstract

This paper proposes a market-based reform that would introduce competition into the provision of urban water. This proposal calls for a decoupling of infrastructure control and ownership of water whereby the property rights to water would be transferred to private hands. The proposal involves periodically allocation (e.g. by auction) of existing water stock held in urban catchments to virtual suppliers who then compete in providing bulk water. This change when coupled with effective third party access and retail competition would lead to a competitive market for the provision of urban water. The approach aims to address concerns over inefficient pricing and infrastructure provision under the current arrangement. Copyright 2008 The Authors. Journal compilation 2008 Australian Agricultural and Resource Economics Society Inc. and Blackwell Publishing Asia Pty Ltd.

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File URL: http://hdl.handle.net/10.1111/j.1467-8489.2007.00433.x
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Bibliographic Info

Article provided by Australian Agricultural and Resource Economics Society in its journal Australian Journal of Agricultural and Resource Economics.

Volume (Year): 52 (2008)
Issue (Month): 3 (09)
Pages: 217-233

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Handle: RePEc:bla:ajarec:v:52:y:2008:i:3:p:217-233

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References

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  1. Anonymous, 2003. "Water Rights Arrangements in Australia and Overseas," Commission Research Papers 31899, Productivity Commission.
  2. Mansur, Erin T. & Olmstead, Sheila M., 2012. "The value of scarce water: Measuring the inefficiency of municipal regulations," Journal of Urban Economics, Elsevier, vol. 71(3), pages 332-346.
  3. Grafton, R. Quentin & Kompas, Tom, 2002. "Pricing Sydney water," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(3), September.
  4. J. Luis Guasch, 2004. "Granting and Renegotiating Infrastructure Concessions : Doing it Right," World Bank Publications, The World Bank, number 15024, October.
  5. Hugh Sibly, 2006. "Efficient Urban Water Pricing," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 39(2), pages 227-237, 06.
  6. R. Quentin Grafton & Michael B. Ward, 2008. "Prices versus Rationing: Marshallian Surplus and Mandatory Water Restrictions," The Economic Record, The Economic Society of Australia, vol. 84(s1), pages S57-S65, 09.
  7. Bert Willems, 2005. "Physical and Financial Virtual Power Plants," Center for Economic Studies - Discussion papers ces0512, Katholieke Universiteit Leuven, Centrum voor Economische Studiƫn.
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Cited by:
  1. Freebairn, John W., 2012. "Risk Aversion and Urban Water Decisions," 2012 Conference (56th), February 7-10, 2012, Freemantle, Australia 124206, Australian Agricultural and Resource Economics Society.

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