Editorial Board

California's Drinking Problem

Aggressive water pricing can encourage conservation without soaking the average user.
Illustration by Bloomberg View

California has at least another five months of drought ahead, U.S. forecasters estimate, putting new pressure on everyone to conserve already stretched water supplies. While farms use 80 percent of the state's water -- and it's essential that they cut back -- cities and towns have to do their share.

The good news is that officials already know how to get people to use less water. The bad news is that too few of them have acted aggressively enough. If the drought ends before they do (forecasters say wet El Nino weather could return next winter), the problems will only be worse the next time the water runs dry.

One effective strategy is to raise the price of water as people use more and more of it. Low prices are charged for the amount most families need for drinking, bathing, and washing dishes and clothes. Higher prices are levied for more discretionary use, mostly for watering the lawn. And use above that level is priced prohibitively.

Two-thirds of California water agencies follow this approach. Some, including San Diego and Watsonville, have even adopted additional upper price tiers, further ramping up costs for the biggest users. Cities and towns with tiered pricing may need to boost the prices on their middle and high tiers to get their biggest users to conserve without adding to the burden of responsible users -- during shortages or even after they end.

Another strategy, adopted by the California-American Water Co. in Los Angeles County, is to raise prices in the summer, when water is low and demand is high, and let them drop back down in the winter. That approach can be used by itself or, better yet, coupled with price tiers.

For pricing signals like these to change behavior, however, they need to be imposed in real time, in people's monthly water bills. Some water agencies still rely on bi-monthly or quarterly bills because it's too expensive to send someone out to read the meters every month. The answer here is automated meters, which are already used in San Francisco but which other parts of California have been slower to adopt. The new meters cost money -- but so does trucking in water during a drought.

Another idea that works is to pay people to replace their lawns with plants that don't need as much water. "Cash for grass" is used in Los Angeles County and elsewhere. More communities should follow their example, and they should find out if raising payment levels will encourage more households to take part.

Rules help, too, of course: everything from regulations mandating water efficiency -- California was the first state to require low-flow toilets for all renovated homes -- to rationing during droughts. But market incentives need to be a bigger part of the picture. The best argument for more aggressive pricing is that it might preempt draconian restrictions when water shortages are severe.

Yes, California needs more far-reaching solutions, especially if climate change leads to more frequent droughts. That includes changing the system of water allocation and subsidies for agriculture. And it means making it easier for communities to buy water from one another and from farmers.

Given the political and legal obstacles, however, those shifts will take a while to accomplish. In the meantime, California water managers need to use, with greater force, the water-saving tools they have already have -- and, where necessary, keep using them when the drought ends.

    --Editors: Christopher Flavelle, Mary Duenwald.

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    David Shipley at davidshipley@bloomberg.net

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