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Comprehensive Regulation of Water Services. Why Quality of Service and Economic Costs Cannot be Considered Separately

Author

Listed:
  • Enrique Cabrera Jr.

    (ITA, Universitat Politècnica de València)

  • Elvira Estruch-Juan

    (ITA, Universitat Politècnica de València)

  • Elena Gómez

    (ITA, Universitat Politècnica de València)

  • Roberto Teso

    (ITA, Universitat Politècnica de València)

Abstract

Regulation in the water sector emerged as a formula to protect customers from the natural monopoly that conforms water and wastewater services. As there is little information about regulatory practices in the sector around the world, information has been collected though a survey sent to water regulators. The results of the survey provided enough information to understand how the different utilities’ behaviours are regulated and the methodologies used. Among all the behaviours to be regulated, economic and quality of service regulation emerge as key aspects from a technical point of view. The first one supervises utilities’ costs and tariffs while the second, the standards the service is provided. However, it has been detected that these aspects are regulated separately and the quality of service does not have an impact on economic regulation. This work quantifies the impact that the quality of services has on costs and the consequences derived from not considering it in the economic regulation. In addition, this study also lists all the different aspect of the quality of service with an impact on costs.

Suggested Citation

  • Enrique Cabrera Jr. & Elvira Estruch-Juan & Elena Gómez & Roberto Teso, 2022. "Comprehensive Regulation of Water Services. Why Quality of Service and Economic Costs Cannot be Considered Separately," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(9), pages 3247-3264, July.
    • Handle: RePEc:spr:waterr:v:36:y:2022:i:9:d:10.1007_s11269-022-03198-x
    DOI: 10.1007/s11269-022-03198-x
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    References listed on IDEAS

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    1. Vinnari, Eija M., 2006. "The economic regulation of publicly owned water utilities: The case of Finland," Utilities Policy, Elsevier, vol. 14(3), pages 158-165, September.
    2. Marques, Rui Cunha, 2006. "A yardstick competition model for Portuguese water and sewerage services regulation," Utilities Policy, Elsevier, vol. 14(3), pages 175-184, September.
    3. Picazo-Tadeo, Andres J. & Saez-Fernandez, Francisco J. & Gonzalez-Gomez, Francisco, 2008. "Does service quality matter in measuring the performance of water utilities," Utilities Policy, Elsevier, vol. 16(1), pages 30-38, March.
    4. Beecher, Janice A. & Kalmbach, Jason A., 2013. "Structure, regulation, and pricing of water in the United States: A study of the Great Lakes region," Utilities Policy, Elsevier, vol. 24(C), pages 32-47.
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