RFF on the Issues

RFF on the Issues: Mandatory Policies for Managing Water Demand during Droughts

May 25, 2017 | Casey J. Wichman

Cape Town, South Africa, is currently experiencing an extreme drought affecting the country’s Western Cape province. According to an Associated Press report, the city “wants daily water usage to be reduced to 100 liters (26 gallons) per person and recommends taking two-minute showers and flushing the toilet only when necessary.” Although the city typically sees fewer tourists at this time of year, residents are concerned that taps could be turned off if conditions do not improve. Following a continued drop in reservoir levels, the city said it will “start to implement a lifeline supply which entails reducing the water pressure to a very low level.”

I wrote last year about policies that use pricing mechanisms or mandatory restrictions to reduce household water use and encourage water conservation during times of drought. In a study examining North Carolina’s 2007 drought, my coauthors and I found that voluntary policies to reduce water consumption induced just an 8 percent reduction in consumption on average—and that mandatory policies resulted in a 13 percent decrease more uniformly across income groups. But that’s not the end of the story. In our analysis, the mandatory policy effectively reduced consumption among the biggest water users while remaining equitable across households with different incomes—which is nearly the polar opposite of what we saw with price changes. Officials in Cape Town and elsewhere in the province may want to consider the potential impacts of water restrictions on lower-income residents as they seek solutions to the current crisis.

Read more analysis by RFF experts on water.

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