The Water Shortage Myth of California
We can solve America's water "shortage" in the same way that we would solve a shortage in any market. Increase prices until the quantity demanded falls to equal the quantity available. This pricing system would ensure that everyone gets a basic allocation of cheap water while forcing guzzlers to pay a high price.
Want to use more water? Pay for it.
A poster on my blog (Aquafornia) responded to your article like this:
While I don’t disagree with David Zetlands proposal of tier pricing for water consumption, the problem with his proposal is that water is not a function of “households”, it’s a function of people. Houses don’t take showers, flush toilets, cook, or wash clothes, people do.
The more people in a household, more water use. They can even be quite frugal in there water use but Zetland proposes charging households more because they reach some randomly choosen threshhold.
Zetland’s proposal leans heavily in favor of 1 or 2 person households (singles, empty nesters, etc.) and it even lets them waste water. His proposal punishes households with 4, 5 or more members in the household.
Pricing based on consumption could be a good idea but unfortunately the LADWP doesn’t have the ability to tier pricing based on the number of people in a household.
Another problem is that because a person uses less water in there home, that doesn’t mean that they are better at water conservation. Many people ’shift’ their water usage on to other venues such as restaraunts, dry cleaners, gyms, etc.
Los Angeles, the city that Zetland refers to, doesn’t have enough water. As the population increases they are still left at less than 690,000 acre feet per year. Is Zetland suggesting that if planners continue to build more housing and the population increases to 5.3 million people we should punish residents with even higher rates?
Conservation needs to begin at the regional planning level and it should include moratoriums on housing construction when developers cannot cannot find entitlements to new water sources.
I found this comment rather amusing:
>Any leftover profits could be refunded to consumers or used to enhance the quality or quantity of the water supply.
David Zetland is probably not familiar with the promises made for bond measures in California.
We’ve had 6 voter approved bond measures going back to 1996 and costing us $16.6 BILLION that promised to resolve future water shortages and increase quality.
I wrote about this at Broken Promises - Water Bonds don’t follow through on promises (http://westchesterparents.org/?p=252)
LADWP certainly DOES have the ability to tier on population. (They use lot sizes now!).
As to shifting demand to other venues, that's no big deal (that's why gyms have membership fees!)
"Los Angeles doesn’t have enough water" That phrase is nonsense to an economist. Raise prices and the resource is suddenly "abundant" Higher rates would surely reduce growth ("planners?")
Conservation would follow organically with higher rates (see gasoline at $4/gallon!)
Refunds are NOT the same as broken bond measures. Most of those funded infrastructure and all the cement in the world will not help if prices are too low.
David
I certainly agree with you, by the way. I was just passing on his comment to you so you could respond to it.
Water is way too cheap down here in Southern California. Some water systems in California are net producers of energy - the Owens Valley Aqueduct & the Central Valley Project are, but the State Water Project & the Colorado River Aqueduct are net consumers of energy, so there is a lot of cost just in conveyance alone. (The figure I have seen is 3000 kWh for every acre-foot from SWP, 2000 kWh for every acre-foot from the Colorado River Aqueduct.) Yet our water bill is around 50 to $75 per month, here in SoCal. Every house around here has a lawn; water is so abundant, we grow algae in the gutters.
My parents live in Reno. They get their water from the ground & from the Truckee River, which conveniently runs through town. (In other words, very little $ for conveyance.) Their bill is about $150 per month*, and they have lawns, front & back, on about 1/3 acre. All around town, there are many houses utilizing drought-tolerant landscaping, and conservation is part of the regular dialog of the town.
Voluntary cutbacks don't really work. I think 'conservation pricing' is really the only way to get people's attention. Most people won't pay to grow that algae in the gutter.
*My parents house was retrofitted with a water meter a year or so ago. Up until then and until next year, they still have flat-rate water service, for about $50 a month. Their bill shows them how much they would have paid if meter readings would have been used. My mom is such a miser, I expect next year when they have to start paying metered rates, the lawns will be gone!
However to say there is no water shortage ("The Water Shortage Myth of California" ) while state and city planners encourage more housing production is simply ludicrous. We didn't have a shortage when LA's population was 2.8 million, we have a shortage with 4.1 million along with the unbridled housing production in the surrounding 5 counties. The shortage is not simply due to a bunch of Nahai's out there.
The title is misleading. When engineers talk about water shortage it simply means "water use> water renewal". This is all about mass balance with no economics. And this is what most of the people think about when we talk about "water shortage".
David is a good scientist but there is something that he should be careful about. David should understand that everyone is not an economist and some of the facts which are simple and obvious to him are not understandable by others. He keep talking about raising water prices and having water markets. I don't say he is not right. I like what he says. But if he keep insisting on something which is not clear to others, his words lose their value.
David, you criticize engineers all the time and some of the things you say are right but you need to teach engineers some basic concepts and bring them on the same page before talking about some other stuff.
To me the definition of "water shortage" is something different from you. Water shortage has a very clear definition in my world and I don't know why economists don't understand this definition! You think the same way I believe. You have a clear definition of water shortage and it might be surprising to you that we don't understand your definition. Engineers and economists cannot solve problems together unless they understand each other. Both groups are needed for solving water problems.
"People are talking about water rights. It's not easy to raise the prices all of a sudden. People don't die if gas gets more expensive and they cannot afford it" -- that's why I propose 75/gal/capita/day for free.
@Ryan13 -- damn -- what's your definition of shortage? Mine is the Quantity demanded > quantity supplied. The adjusting mechanism is price, i.e., higher price will reduce demand.
Engineers (IMO) often see outflows >inflows and go look for more water. They take prices as given. When it's hard to find more water, they say there's a shortage. I say raise prices.
I have HUGE respect for engineers. I have LESS respect for people who think they can engineer their way out of a social problem (e.g., cheap water or crooked politicians).
I live in Santa Clarita, which is just north-east of the San Fernando Valley. Up here, they can't build the houses fast enough - at least before the mortgage thing. Now things have slowed down, but still, there are over 2000 homes going in around my neighborhood, just within a 1 or 2 mile radius. And it's like this all over town.
There is a finite amount of water resources here in Southern California, and I can tell you that Southern California is getting all the water it will ever get from the Delta, Los Angeles Aqueduct, and the Colorado River. In fact, instead of getting more, we're likely to get less. (Check out this story and see why: http://aquafornia.com/archives/3016)
Which means by simple math: same amount of water divided by more people means less for everyone.
http://www.siswebs.org/water/story.php?title=What_people_think_about_the-1
Lets assume that average person is able to reduce their consumption to 116 gallons per day. At 4.1 million people in the City of Los Angeles that's roughly 532,500 acre feet. At 4.8 million we'll be just under LADWP's twenty five year average of 634,000 AF and we haven't even factored on commercial (restaurants, factories, hospitals, etc.) requirements or those who "can afford" to purchase 500 gallons per day.
Planners at SCAG are insisting on housing for 5.3 million people in the City of Los Angeles by 2050 and at that same consumption we'll be over LADWP average deliveries of 634,142 AF and I haven't even brought up the other 5 counties where planners foresee 30.3 million by 2050
Each city is required to produce their own Housing Element. Right now Los Angeles is drafting the 2006-2014 Housing Element and it has the same disconnect as we see at the state level with regard to water. It's simply not required by the state.
In my opinion we do not have great planning policies and water planning because its not explicitly required. So the focus just stays on transportation, jobs, etc...
You can see LA's draft housing element (3 MB pdf file) at:
http://planning.lacity.org/HousingInitiatives/HousingElement/DraftLACityHsgElement.pdf