Many cities and regions of the United States, particularly in the West, are at risk of water shortages so sudden and severe that the US Office of the Director of National Intelligence now considers water scarcity as a major threat to national security. The American Water Works Association reports water companies may begin to force their customers to pick up the tab; in the hardest-hit areas, household water bills could triple.
RFF’s Casey Wichman notes, however, that simply raising prices fails to effectively promote water conservation. Wichman advocates using a mandatory policy that penalizes extraneous water use. His research shows how restrictions on turf irrigation, car washing, and watering of vegetable gardens promoted a nearly 13 percent decrease in aggregate water consumption within the study sample. Wichman also notes, “the mandatory policy effectively reduced consumption among the biggest water users while remaining equitable across households with different incomes. This nearly the polar opposite of what we see with price changes.”
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