New Zealand Water Pricing

Abstract

Methods of charging, water use, and cost comparisons were made for municipal, irrigation, and hydropower generation uses of water. For municipal use, city size and water metering influenced per capita use, with larger cities and metered use being associated with lower per capita use. Drinking water quality (for smaller councils), demand management (for growing cities), and long-term asset management are the developing issues for municipal water supply. For irrigation, the cost of entitlements related to the age of the scheme (older schemes with capital paid off had lower costs), recent capital investment, and operating costs. Investment in irrigation schemes was being undertaken to improve reliability of supply (through storage) and water use efficiency (through conversion of flood to spray irrigation and replacing open distribution channels with pipes). Water used for hydropower generation was driven by electricity markets. Water values were imputed with rivers with multiple hydro stations, capturing more of the head in the river system having higher values.