California’s extreme drought will force rationing of water or higher prices, say John McKenzie and Richard McKenzie. Raising water prices has a great advantage:
“Higher water prices can increase the state’s available water supply—without additional rainfall or the construction of desalination plants. California is annually losing a massive amount of accessed water in its distribution systems largely to known water pipe leaks that are going unrepaired because the added revenue from the sale of recovered water from leak repairs cannot cover the repair costs—at current low water prices. Thus, higher water prices can translate into greater leak repairs and reduced water losses.”
In their article on EconLib, they offer more detail:
“Authorities overseeing California’s 8,000 water systems are fully aware that a consequential amount of the water entering their systems never reaches consumers’ faucets. Why? California’s distribution systems, consisting of hundreds of thousands of miles of aging pipelines, are full of known leaks that are going unrepaired, mainly because water prices are so low that the revenue from water recovered from fixing them won’t cover the immediate repair or replacement costs.
“California water utilities distribute more than 1.2 trillion gallons of water a year to residents (equal to about a fifth of agricultural use), according to government data. At least 7 percent of residential accessed water—or at least 84 billion gallons—is lost to known leaks.”
Image by Rich DuBose from Pixabay.