The ironic economics and equity of water budget rates

Source: Janice A. Beecher, Journal AWWA, Volume 104 Issue 2, February 2012
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From the abstract:
Water budget rates are gaining attention in the water sector. Although clearly well-intended, the water budget approach to rates raises serious theoretical and practical issues familiar to applied regulatory economics. In essence, water budget rates exemplify “social rate-making,” that is, a system of pricing that departs from traditional economic standards in the interest of serving social goals–in this case water conservation. The inherent problem with this particular rate structure, however, is not its good intentions but its disconcerting implications. The troubling irony of water budget rates appears to be lost in the deliberation.
See also:
Money Matters: Managing Utility Cashflow Instability Under Conservation-based Rates
Source: Grant Hoag and Rowe McKinley, Journal AWWA, Volume 104 Issue 3, March 2012
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