In the United Kingdom, water is provided by private companies and is based on the assessed value of the home rather than the actual amount of water used. However, water shortages and population growth, particularly in the south area of the country that includes London, have caused municipalities and policymakers to rethink how households are billed for water.
The University of Southampton sponsored a conference focused on this issue last fall. Michael Price, an associate professor of economics at the Andrew Young School, was invited to give the keynote address. The conference was funded by the Economic and Social Research Council, the U.K.’s largest organization for funding research on economic and social issues.
Following his keynote address, Price was invited to sit on a panel discussion alongside members of the British Parliament, the Environment Agency and professionals in the water industry.
Price, the only academic expert on the panel, brought a unique perspective based on his experience in working with utility companies to implement large-scale field experiments that pair conservation efforts and regulatory compliance with resource use.
“There are some pilot programs that over the past three or four years have introduced meters and charged people on their actual water use,” Price says. “The conference was based on one of these pilot programs with Southern Water and the initial evaluation Southampton had conducted.”
The pilot program, begun in 2010, had installed 500,000 meters in an area faced with water stress and included an information campaign about the benefits of water conservation that attempted to appeal to the individual’s behavior. However, the pilot found no significant changes in water use attributed to the campaign.
“You need to go beyond providing meters,” Price says. “Evidence shows you can use normative appeals, such as presenting goals to reduce water use, but those reductions in water use will be small. We don’t view these appeals as a solution.”
Price was able to speak to the broader trends and challenges facing the water and energy sector to the policymakers and industry leaders in attendance.
“It’s really hard to promote conservation or changes in patterns of use by pricing, because the use of water and energy are so unique,” he says. “I can think of no other good we buy and don’t know at any point in time how much we’re using.”
Price believes that to see consumer behavior change, there needs to be a larger shift in mindset.
“If you really want to see change, the rhetoric needs to change from where water and energy are seen as a social good or right to one where the government ensures people have access and can afford the goods,” Price says. “We need water and energy to be treated like any other commodity we buy, and still ensure a minimum level of access to low-income individuals. There are policies you can explore that would ensure this access.”
Price will continue his work in this area. He was recently invited, along with the workshop organizers and researchers out of the University of Chicago and the University of Oxford, England, to collaborate with Essex and Sulfolk Water Utility in ongoing research projects.
“We are continuing to work on ideas and projects to promote water conservation and smarter reductions in use,” he says. “All of the water in the U.K. comes from surface water, and right now they’re consuming more than they can supply, so the big focus is conservation.
“Parliament is looking for regional solutions and not yet pushing for national policy. I think the solutions will be more local,” he says.