1. Full cost recovery of water services and the 3 T's of OECD.
- Author
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Barraqué, Bernard
- Subjects
- *
DEPRECIATION , *ENVIRONMENTAL economics , *RESOURCE allocation , *WATER , *WASTE recycling - Abstract
In Europe today, tariff design is no simple matter; consumption decline highlights that 'optimal' tariff doesn't exist. The OECD 3 T's cost recovery approach allows to discuss solutions to implementing the triple bottom line of sustainability in the water services sector, through new governance mechanisms. For both internal and external governance, additional knowledge can help adapt tariff design. And the recovery of environmental and resource costs paid by authorities in charge of water services could be passed on citizens (local taxes) rather than customers (water bills). In France, the liberal state tradition makes it impossible, leading to incoherent tariffs. • Full cost includes O&M, capital charges, and environmental and resource costs. Should all these costs be borne by water bills? • Cost recovery systems vary in Europe, including with local taxes or rates, and through collective metering and billing. • Environmental and users costs may be covered through mutualised service fees, with transfers between categories of users. • Governance includes internal (authorities - operators - users) and external (partners, and resources allocation issues). • Utilities can check in advance the redistributive effects of tariff changes between customers and with the operator. [ABSTRACT FROM AUTHOR]
- Published
- 2020
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