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Nonlinear pricing and capacity planning for water and wastewater services

Author

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  • Jihad Elnaboulsi

    () (CRESE - Centre de REcherches sur les Stratégies Economiques (EA 3190) - UBFC - Université Bourgogne Franche-Comté [COMUE] - UFC - Université de Franche-Comté)

Abstract

The purpose of this paper is to determine the optimal nonlinear pricing rules for water services. The model presents a standard water distribution system and a separate wastewater collection and treatment system. Technical and financial constraints are considered. The optimization process of a welfare utility function subject to different kind of constraints provides the optimal pricing rules for drinking water and sewerage services. These prices reflect efficiently the costs of systems constraints, the cyclicity of demands, the time-of-use, heterogeneity types of consumers and the real value of water resources scarcity. They provide important guidance in the design of efficient water rates and in the development of different water utilities planning strategies. New technologies in water metering (telemetry) should permit applying this model.

Suggested Citation

  • Jihad Elnaboulsi, 2001. "Nonlinear pricing and capacity planning for water and wastewater services," Post-Print hal-00447925, HAL.
  • Handle: RePEc:hal:journl:hal-00447925
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00447925
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    Cited by:

    1. Hugh Sibly & Richard Tooth, 2014. "The consequences of using increasing block tariffs to price urban water," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 58(2), pages 223-243, April.
    2. R. Amit & Parthasarathy Ramachandran, 2010. "A Fair Contract for Managing Water Scarcity," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 24(6), pages 1195-1209, April.
    3. Rita Martins & Carlota Quintal & Eduardo Barata & Luís Cruz, 2010. "Water Pricing and Social Equity in Portuguese Municipalities," GEMF Working Papers 2010-17, GEMF, Faculty of Economics, University of Coimbra.
    4. Vladimir PoluyanovVP & Nataliia Palamarchuk, 2017. "Integrated Assessment of the Policy of Working Capital Management in Housing and Utilities Enterprises," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(2), pages 489-499.
    5. Rita Martins & Luis Cruz & Eduardo Barata, 2013. "Water Price Regulation: A Review of Portuguese Tariff Recommendations," Public Organization Review, Springer, vol. 13(2), pages 197-205, June.
    6. Andrés Chambouleyron, 2002. "An Incentive Mechanism for Decentralized Water Metering Decisions," Industrial Organization 0206001, University Library of Munich, Germany, revised 01 Nov 2002.
    7. Andrés Chambouleyron, 2003. "An Incentive Mechanism for Decentralized Water Metering Decisions," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 17(2), pages 89-111, April.
    8. Roseta-Palma, Catarina & Monteiro, Henrique, 2008. "Pricing for Scarcity," MPRA Paper 10384, University Library of Munich, Germany.
    9. Fuente, David, 2019. "The design and evaluation of water tariffs: A systematic review," Utilities Policy, Elsevier, vol. 61(C).

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