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Bringing Competition to Urban Water Supply

  • Hugh Sibly

    ()

    (School of Economics and Finance, University of Tasmania)

  • Richard Tooth

    ()

    (School of Economics and Finance, University of Tasmania)

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.

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File URL: http://eprints.utas.edu.au/2373/
File Function: First version, 2007
Download Restriction: no

Paper provided by University of Tasmania, School of Economics and Finance in its series Working Papers with number 2373.

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Length: 16 pages
Date of creation: Oct 2007
Date of revision:
Publication status: Published by the University of Tasmania School of Economics and Finance as part of its working paper series, October, 2007.
Handle: RePEc:tas:wpaper:2373
Contact details of provider: Postal: Private Bag 85, Hobart, Tasmania 7001
Phone: +61 3 6226 7672
Fax: +61 3 6226 7587
Web page: http://www.utas.edu.au/economics-finance/
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  1. J. Luis Guasch, 2004. "Granting and Renegotiating Infrastructure Concessions : Doing it Right," World Bank Publications, The World Bank, number 15024, October.
  2. Anonymous, 2003. "Water Rights Arrangements in Australia and Overseas," Commission Research Papers 31899, Productivity Commission.
  3. Bert Willems, 2005. "Physical and Financial Virtual Power Plants," Center for Economic Studies - Discussion papers ces0512, Katholieke Universiteit Leuven, Centrum voor Economische Studiƫn.
  4. 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.
  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. 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.
  7. R. Quentin Grafton & Tom Kompas, 2007. "Pricing Sydney water ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(3), pages 227-241, 09.
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