Socio-Economic Problems

The speaker makes clear that water supply has to be treated differently in developed countries and developing countries. Simplifying media hype does not help at all. Water is still not a commodity because there is not an appreciable market. In situations of extreme necessity, the solvent buy water at exorbitant conditions, but: there is no market, because there is no broker! Wars (just) for water are unlikely, for example in the Middle East, because the different countries are absorbed by their internal problems. All people have access to water; the question is about quality. Water is an economic good, but what type of good is it? A distinction has to be made between water as a resource and its services. Total costs of water include efficient, environmentally sustainable, financial market, operating and maintenance costs. Water supply works as a club: First of all, an (expensive) infrastructure has to be established and maintained which is not interesting for private providers (and consumers). Water is a renewable resource and not a mineral nutrient. If small quantities of water are used, the price might perhaps rise. Water services can be a public good if authorities guarantee maintenance. Drinking water might be considered as something between a public good and “club service”. In Europe, there are different models of public and private partnerships; private companies often render the supply on behalf of communities in line with the subsidiary principle. Complete privatization does not seem to be sustainable. Governments need to continue performing a supervisory function, but negotiations and agreements between providers and consumers have to take place. Spain is a negative example of how cheap water can be wasted. Desalination might be expensive and energy-intensive, but it is also very suitable for determined contexts. Certain measures regarding demand and supply management are necessary: flexibility, recycling, consumption reduction, allocation, land use regulations, technological innovations, passing on of costs etc.Questions from the audience: time-consuming investments should be charged to the customer’s account by authorities with delegated partners. In Holland, for example, almost thousand-year-old water authorities maintain ecosystems and trade with rights.