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Tariff Suitability Framework for Water Supply Services

Author

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  • Francisco Silva Pinto

    (Universidade de Lisboa)

  • Rui Cunha Marques

    (Universidade de Lisboa)

Abstract

Water supply (WS) tariffs have evolved significantly in the past decades, although in a varying fashion around the world. Indeed, this development is linked to increasingly demanding requirements, or objectives that have to be achieved by water utilities (e.g., stricter quality standards and infrastructure maintenance levels, cost recovery, social concerns and environmental protection demands). The perception of WS tariffs as a powerful management tool, subject to context dependent objectives, raises the concern on how utilities prioritize them. This hierarchy is desirable due to the possible conflicting nature of objectives. From that point of view, and on the basis of protecting the public interest, the fitness between objectives set by the utilities and actual needs may require a broader institutional approach. The need for regulatory activity may be required in the context of too much arbitrariness in tariff setting procedures. For this objective, a regulatory tool is set, based on multicriteria decision analysis (MCDA) modeling methods, to provide a requisite framework capable of considering the multiple dimensions of WS tariffs and the assessment of specialists, practitioners and other legitimate stakeholders in the ‘tariff setting’ decision making process. The specified tariff suitability framework (TSF) will work as a regulatory tool, taking into account the utilities’ particular context and background factors. The outcomes allow to determine the tariff suitability and to build tailored policy recommendations, which are critical aspects for a sound regulation.

Suggested Citation

  • Francisco Silva Pinto & Rui Cunha Marques, 2016. "Tariff Suitability Framework for Water Supply Services," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(6), pages 2037-2053, April.
    • Handle: RePEc:spr:waterr:v:30:y:2016:i:6:d:10.1007_s11269-016-1268-z
    DOI: 10.1007/s11269-016-1268-z
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    2. Zhong-Kai Feng & Wen-Jing Niu & Jian-Zhong Zhou & Chun-Tian Cheng & Hui Qin & Zhi-Qiang Jiang, 2017. "Parallel Multi-Objective Genetic Algorithm for Short-Term Economic Environmental Hydrothermal Scheduling," Energies, MDPI, vol. 10(2), pages 1-22, January.
    3. Christine Mawia Julius & Timothy C. Okech, 2021. "Moderation Effect of Government Regulation on the Joint Influence of Water Pricing, Infrastructure Financing, Utility Efficiency and Subsidies on Financial Sustainability of Water Service Providers in," International Journal of Economics and Financial Issues, Econjournals, vol. 11(3), pages 72-80.
    4. Romano, Giulia & Guerrini, Andrea & Senoner, Thomas, 2020. "Establishing a new water tariff method that complies with european principles and respects statutory autonomy: The case of South Tyrol," Utilities Policy, Elsevier, vol. 64(C).
    5. Ruiz-Rosa, Inés & García-Rodríguez, Francisco J. & Antonova, Natalia, 2020. "Developing a methodology to recover the cost of wastewater reuse: A proposal based on the polluter pays principle," Utilities Policy, Elsevier, vol. 65(C).
    6. Fuente, David, 2019. "The design and evaluation of water tariffs: A systematic review," Utilities Policy, Elsevier, vol. 61(C).
    7. Jordi Honey-Rosés & Claudio Pareja, 2019. "Metrics and Methods for Comparing Water Utility Rate Structures," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 5(02), pages 1-31, April.
    8. Pinto, Francisco Silva & Simões, Pedro & Marques, Rui Cunha, 2017. "Raising the bar: The role of governance in performance assessments," Utilities Policy, Elsevier, vol. 49(C), pages 38-47.
    9. Madson B. S. Monte & Adiel T. Almeida-Filho, 2016. "A Multicriteria Approach Using MAUT to Assist the Maintenance of a Water Supply System Located in a Low-Income Community," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(9), pages 3093-3106, July.
    10. María Molinos-Senante & Manuel Mocholi-Arce & Ramón Sala-Garrido, 2016. "Efficiency Assessment of Water and Sewerage Companies: a Disaggregated Approach Accounting for Service Quality," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(12), pages 4311-4328, September.

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