Higher Water Tariffs for Less River Pollution - Evidence from Min River and Fuzhou City, People's Republic of China
Jiang, Yi; Jin, Leshan; Lin, Tun | May 2010
Abstract
Upstream nonpoint source pollution has become a significant threat to urban drinking water safety in the People’s Republic of China. Payment for environmental services (PES) is seen as a promising mechanism to deal with the situation. In designing a sound PES, it is crucial to determine the willingness to pay (WTP) of urban beneficiaries for upstream water pollution controls. An analysis of household data from a contingent valuation survey conducted in Fuzhou in 2009 reveals that household income is the most important factor in determining respondents’ positions on water tariff increases as well as WTP under a PES scheme. Mean WTP varies from Yuan (CNY) –0.45 per cubic meter to CNY0.86 for different income groups. The overall mean WTP is estimated to be CNY0.21, which is equivalent to a 10% increase in the current tariff, with the 95% confidence interval at (CNY0.12, CNY0.31). The point estimate implies a total annual WTP of Fuzhou City equal to CNY22 million, which is 27% less than the contribution of Fuzhou to an ongoing government-financed PES. However, with continuous water tariff increases, affordability among low-income households might arise as an issue. This calls for subsidies targeting low-income households to be incorporated in water tariff reform.
Citation
Jiang, Yi; Jin, Leshan; Lin, Tun. 2010. Higher Water Tariffs for Less River Pollution - Evidence from Min River and Fuzhou City, People's Republic of China. © Asian Development Bank. http://hdl.handle.net/11540/4183. License: CC BY 3.0 IGO.ISSN
1655-5252
Keywords
Access To Water
Available Water
Demand For Water
Drinking Water
Drinking Water And Sanitation
Freshwater
Groundwater Quality
Managing Water Resources
Financial & Private Sector Development
Private Sector
Private Sector Activities
Private Sector Analysis
Private Sector Assessments
Private Sector Development
Private Sector Investments
Private Sector Management
Private Sector Participation
Private Sector Projects
Sewage management
Waste Disposal
Sanitation services wastes
Water pollutants
Water storage
Private enterprises
Private ownership
Privatization
Fresh water
Underground water
Water quality management
Drinking water protection
Source water protection
Water-supply
Water harvesting
Water in agriculture
Integrated water development
Residential water consumption
Corporatization
Capitalism
Free markets
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http://hdl.handle.net/11540/4183Metadata
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