Residential Water Use Rate Revenue And Nonprice Conservation Program Database

This report describes and contains the information and database developed for the research study Effectiveness of Residential Water Conservation Price and Nonprice Programs (Michelsen, McGuckin and Stumpf 1998). The water demand, price and conservation program information documented in this report is the result of research and data collection efforts and utility cooperation initiated in 1991 by William Bruvold and continued by the researchers of this report through a consortium of universities. The study encompasses seven water utilities in three western states- California, Colorado and New Mexico. The information gathered, developed and refined for this study was digitized and a database created in spreadsheet format for analysis. Database structure, variable names, definitions, computational adjustments and study area characteristics are described in this report. Water demand model descriptions and analysis results of this research are presented in another publication of the AWWA Research Foundation by Michelsen, McGuckin and Stumpf (1998) entitled Effectiveness of Residential Water Conservation Price and Nonprice Programs.

The purpose of this study is to build upon and extend previous water conservation research efforts of price and nonprice conservation programs on residential water demand in different urban areas of the southwestern United States. The primary research objectives are to: (1) develop residential water demand models to examine the effectiveness of price and nonprice programs; (2) develop and document a database of residential water demand in selected study ares; (3) evaluate the effectiveness of price and nonprice conservation programs using the water demand models and database developed for this study; and (4) examine the applicability of extending regional water demand relationships and results of conservation program effectiveness to other cities in the region. Specific issues examines on regional, seasonal and individual city basis include: How responsive are consumers to changes in the price of water?; are consumers responding to the average price, marginal price, or some combination of the two?; How does demand change or respond to implementation of nonprice conservation program? Is it appropriate to model and apply results on effectiveness to other cities in the region? The scope in terms of number and cross section of cities, detail of observations (monthly time periods), length of time covered and inclusion of price and nonprice programs combined with the analytical techniques used, contribute to making his one of the most comprehensive studies conducted on residential water use and the effectiveness of conservation programs. The research techniques and results of this evaluation will benefit water utilities and consumers through lower costs and more secure water supplies because of improved understanding and better planning and implementation of residential price, rate structure and nonprice conservation programs.

The marginal price elasticities estimated by Martinez-Espineira conforms to expectation. The price specification that accounts for the changing proportion of water users in each block yields a higher elasticity (-0. 47) compared to the spec ification ignoring this feature of the data. However, this difference is not found to be statistically significant, a result attributed to the low power of the test (small sample size limiting the accuracy of estimates). In conclusion, the paper provides a theoretically correct price specification for demand functions under block pricing and aggregate data. The empirical findings in the paper, however, are not conclusive and further empirical work using more data and alternative (nonlinear) demand functions, is needed to show the practical implications of the arguments put forward by the Martinez-Espineira's paper. Static empirical consumer demand functions estimated with aggregate data are well known to suffer form serial correlation and other statistical problems asso ciated with misspecified dynamics. These dynamics arise because consumers do not react immediately to a change in prices due to their largely predetermined lifestyle. In the case of demand for water, for example, current purchases can be largely predetermined due to commitments arising from past purchases such as swimming pools, bathtubs, dishwashing machines, etc. Muellbauer and Pashardes (1992) show that the autoregressive nature of consumer demand data can be cap tured in a theoretically consistent manner by incorporating intertemporal aspects of consumer behaviour in the model through habit formation and durability.

On the one hand, population and economic growth are increasing the demand for water but on the other, environmental consequences of climate change, pollution and over extraction of groundwater are decreasing the worlds supply of fresh water. This makes the availability of water for human use one of the greatest global concerns of this century. Neither levelling growth nor technological innovation can stretch the existing supplies significantly; hence, it is imperative that demand side management techniques such as the use of water efficient fixtures in urban households, appropriate water tariff structure and regulatory policies are used as tools for water conservation. Conservation of water resources is one of the important aspects of ensuring sustainable development of cities and should incorporate environmental, social and economic dimensions. This book highlights the importance of using water efficiently in urban households, in both developed and developing cities. Specifically, the book focuses on: the determinants of water conservation behaviour, including psychological factors such as values, beliefs and attitudes, socio-economic factors such as income, water pricing and policies, environmental factors such as seasonal variations and demographic factors such as household size and age; the role of policies such as mandatory water restrictions, labelling of water saving devices and promotion of public awareness; the role of water and wastewater tariff structures in achieving the goals of revenue generation, affordability, demand management and equity and the design of conservation oriented rate structures; and the role of water saving devices in providing technological solutions to household water conservation. In relation to the above issues, the book provides several detailed case studies of cities to understand the effectiveness of such demand management tools and the lessons learnt. Overall, the book aims to provide a comprehensive overview of the various price and non-price tools that can be used to manage domestic water consumption. Water Conservation in Urban Households is a one-stop repository of information on water conservation for academics, practitioners and policy makers. The text can be used for teaching and research on water demand management as well as for professional reference by water utility officials. In addition, the appendix of the book contains a database of the current domestic water and wastewater tariffs and monthly bills of selected cities, which will be helpful for those willing to conduct research in this field. Author: Sonia Ferdous Hoque, University of Leeds, UK.