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A fuzzy logic-based approach for progressive pricing of freshwater in Jordan

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  • Ghada Altarawneh

    (Mutah University
    University of Tabuk)

Abstract

The current freshwater pricing in Jordan is based on Block Rate tariffs, with a flat rate and fixed price per-block, this pricing system has several drawbacks, including and not limited to the breach of equity principle, and is not progressive enough to penalize irresponsible consumers of water in a dry country like Jordan. This paper proposes an alternative pricing system using fuzzy logic; this system consists of 3 stages, input curves, which are based on the water consumption, output curves, which are based on the water prices per cubic meter, and logical rules to move inference from input to output. Our experimental results, based on simulated water bills, show that the proposed pricing system is flexible, provides fair sale prices to both customers and water suppliers, is more progressive, as it penalizes the larger consumers of water, rewards the smaller consumers of water, and increases the number of happy customers, and consequently, saves water by preventing irresponsible use. Therefore, we recommend the propose pricing system to be used for pricing water in Jordan.

Suggested Citation

  • Ghada Altarawneh, 2021. "A fuzzy logic-based approach for progressive pricing of freshwater in Jordan," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 20(4), pages 480-489, August.
    • Handle: RePEc:pal:jorapm:v:20:y:2021:i:4:d:10.1057_s41272-020-00266-y
    DOI: 10.1057/s41272-020-00266-y
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    References listed on IDEAS

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    1. Gurung, Aditya & Martínez-Espiñeira, Roberto, 2019. "Determinants of the water rate structure choice by Canadian municipalities," Utilities Policy, Elsevier, vol. 58(C), pages 89-101.
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    3. Ghada A. Altarawneh, 2018. "A fuzzy logic-based approach for pricing of electricity in Jordan," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 17(5), pages 365-372, October.
    4. Torriti, Jacopo, 2012. "Price-based demand side management: Assessing the impacts of time-of-use tariffs on residential electricity demand and peak shifting in Northern Italy," Energy, Elsevier, vol. 44(1), pages 576-583.
    5. Piet Rietveld & Jan Rouwendal & Bert Zwart, 2000. "Block Rate Pricing of Water in Indonesia: An Analysis of Welfare Effects," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 36(3), pages 73-92.
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    Cited by:

    1. Ghada A. Altarawneh & Ahmad B. Hassanat & Ahmad S. Tarawneh & David Carfì & Abdullah Almuhaimeed, 2022. "Fuzzy Win-Win: A Novel Approach to Quantify Win-Win Using Fuzzy Logic," Mathematics, MDPI, vol. 10(6), pages 1-17, March.

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