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Economic and Corporate Powers Call for Hike in Global Water Price
World Bank and OECD say water is a finite resource that must be valued at a higher price in order to repair old supply systems and build new ones
Major economies are pushing for substantial increases in the price of water around the world as concern mounts about dwindling supplies and rising population.
Water drips from an irrigation pipe on fallow fields on a farm in Firebaugh, California. (Photograph: Robyn Beck/AFP/Getty Images) With
official UN figures showing that 1 billion people lack access to clean
drinking water and more than double that number do not have proper
sanitation, increases in prices will be – and in some countries are
already proving to be – hugely controversial.
However experts argue that as long as most countries provide huge subsidies for water it will not be possible to change the wasteful habits of consumers, farmers and industry, nor to raise the investment needed to repair old supply systems and build new ones. And price rises can be managed so that they do not penalise the poorest.
Last Friday, the World Bank held a high-level private meeting about water in New York, at which higher prices were discussed. Days before that the OECD, which represents the world's major economies, issued three water reports calling for prices to rise. "Putting a price on water will make us aware of the scarcity and make us take better care of it," said Angel Gurría, the OECD secretary-general. It has also been a key theme at this week's meeting of industry leaders in Paris, hosted by Global Water Intelligence.
The discussion at the World Bank was raised by Lars Thunell, chief executive officer of the International Finance Corporation. "Everyone said water must be somehow valued: whether you call it cost, or price, or cost recover," said Usha Rao-Monari, senior manager of the IFC's infrastructure department. "It's not an infinite resource, and anything that's not an infinite resource must be valued."
Concern about dwindling water supplies has been rising with growing populations and economies. And with climate change altering rainfall patterns, experts warn that unless changes are made, up to half the world's population could live in areas without sustainable clean water to meet their daily needs.
Global Water Intelligence's 2010 market report estimated the industry needs to spend $571bn (£373bn) a year to maintain and improve its networks and treatment plants to meet rising demand - more than three times this year's projected spending.
At the same time, a major report last year by consultants McKinsey, paid for by a group of water-dependent global brands including SABMiller and Nestlé, said that most of the estimated "gap" in water in 2030 could be met from efficiency savings such as better irrigation and new showerheads.
However, highly subsidised prices are hampering both investment and efficiency, because private and public companies cannot collect enough water, nor persuade farmers, homeowners and businesses to make - and sometimes pay for - changes to reduce their water use, say the experts.
"We were in a vicious cycle," says Virgilio Rivera, a director of Manila Water, which took over water and sewage services in the city when the Philippines government passed a National Water Crisis Act in 1997. "Lack of investment; poor service; government can't increase the water rates because customers are dissatisfied; they are not paying, so low cash flows; so the government can't improve the service."
Huge opposition to price rises is expected however, especially as so many prices are set by elected politicians.
Even in Washington DC there has been an outcry over calls for prices to double over the next five years to help the city raise money to spend on its 76-year-old network of leaking lead pipes.
Obstacles include a long term "legitimacy" from providing free or very cheap water; and vested interests, says Rao-Monari, who cites the example of water vendors in India making big profits from desperate households.
The biggest concern though is the impact on the poorest households. There is evidence that they suffer most from the bad services of poorly funded water companies, because often they are not connected at all or have such bad services they are forced to rely on even more expensive water vendors.
In Manila, Manila Water increased bills from 4.5 to 30 pesos per cubic metre. At first there was resistance but by 2003 the company doubled connections from 3m to 6m, including 1.6m of the poorest squatters, leakage had been cut drastically, and pressure and quality had improved, said Rivera, one of the company's directors visiting Paris. Bills for the poorest households are now less than one-tenth of when they relied on vendors, and payment in the slum areas is 100%, said Rivera.
Some say step pricing can be used to protect a basic water allowance for drinking, cooking and washing – either for very low prices or for free, as it is in South Africa.
"I fully agree the water we need of hydration and minimal hygiene are part of the Human Rights declaration, but this is 25 litres of water [a day], which is the smallest part," said Peter Brabeck-Letmathe, chairman of food giant Nestlé and one of the most prominent global business leaders campaigning on water. More than 95% of water is used to grow food, for other household needs and for industry, he added.
Food prices should not have to rise as higher water bills could be offset by efficiency improvements, from irrigation, to new seeds, or even a changing pattern of what is eaten to favour less water-intensive ingredients, said Brabeck-Letmathe.
Others favour separating water supply from government's duty to take care of the most vulnerable. "Ideally utilities should not make any distinction between rich and poor," said Prof Asit Biswas, president of the Third World Centre for Water Management. "The moment you subsidise [someone's bill] people don't use water prudently."
42 Comments so far
Show AllIs Bechtel up to it's old atrocities again?
Right before Enron crashed a decade ago I read an article in the Wall Street Journal about how Enron was going to manipulate water markets as soon as they were done manipulating electrical power markets.
Most of the Enron pirates never went to jail and are out there preparing to manipulate water markets.
Yeah and like Kenny Lay really kicked the old bucket. He's probably living high on the hog in Dubai along with Jerry Fellwell (from grace).
Here we go again. The IMF, World Bank, and Big Ag. experts explain to the uninformed of the need to privatize water. See "Shock Doctrine" And, of course, if it is subsidized we will all be irresponsible; unlike those who destroy entire cultures and the environment with their world wide land colonization and genetic frankenseeds. We need giant corporations telling us what to do with our food, our savings,
water etc, like we need cardboard frying pans.
Right on! It's telling too that they mention "rising population", which should be a red flag that they are going after water in the developing world, meaning they will raise the price of water in poor countries to the people least able to afford it. This is just a smoke screen for some multinational corporation.
It is in the first world like the US where water is used most wastefully. The average American uses 140 gallons per day for indoor and outdoor uses. We use our most high quality water (drinking water) for flushing our toilets. But industry is the most wasteful. If we used drinking water only for where that quality of water was needed, we could reduce potable water usage by at least 80% (depending on the climate). We should be recycling all of our greywater and blackwater, harvest rainwater and manage stormwater a whole lot better. If we did these things, the water crisis would largely (pun intended) evaporate.
* Water hikes?
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* See Cochabamba.
Yup.
The Military-Industrial-Congressional-Executive Complex wants what the military calls "Full Spectrum Dominance." If they can control and ration out all of our food, all of our water, all of our energy, then they have created a new generation of slaves. People working at whatever they are told to do, however long they are told to do it, just to hope for a pittance to try to feed their families are slaves.
Our Constitution (Remember the Constitution?) was written to see that that doesn't happen.
We the People are living under an increasingly powerful and dictatorial Corporate State (the definition of fascism) and are being turned into mindless robots doing their business, and their dirty work, for them. They just rake in the loot and smile.
Your statement would be somewhat correct if you were referring to the Articles of Confederation--the first constitution. Unfortunately, I doubt that's your intent. The 1787 constitution has allowed all that has happened, indeed facilitated. Just go and read the section regarding the Executive and tell me what constrains his actions other than impeachment? The document is an aristocratic, slaveholder's document, not We the People's.
And this advice to people who live on a WATER PLANET? Screw these monetarists. Better to recruit scientists & engineers to a cvil service "manhattan project" on how to remove the salt from the abundant water supply & distribute it around the world on a massive scale, making water cheaper-than-dirt-cheap,(also how to make more soil for farming). The mideast wars would probably "dry up" if all those countries were to become fertile grasslands & forests.
Oh yeah. And reinstate FDR's 1935 P.U.H.C.A. act to knock these g*dd*mn imperial cartels into the dustbin of history.
Maybe the "peak concept" should be employed. Peak Water has an interesting sound to it. It is a concept that should float. Just think if the whole idea sinks, it could be labelled a melt down.
"Peak Water"--good one.
I don't know, man, I think you are all wet. ;)
Pure, uncontaminated water is certainly in very short supply, most of it being underground or locked in ice sheets. The surface water most of us siphon off from the water cycle is contaminated. But I don't think the "peak concept" applies to water in general as it is recycled through the water cycle. However, if you refer to uncontaminated water, then the "peak concept" might apply.
Where I live, we commonfolks own our water and sewage systems, along with the telephone and electrical power generating and distribution networks--Communalism to be sure. All are extremely well maintained and almost never fail during the strong storms arriving from the Pacific we endure yearly. Every year, I read about the massive power outages occuring in various East Coast locales during storms that are often far less potent than those we get here, and I note that most of the providers there are private, not public. Non-profit municipal systems for most everything that could be considered a Natural Monopoly are superior to private for profit providers in both rates and service. Any polity that allows any of its municipal services to be privatized is bonkers, and it's not too long before they find out why.
World Bank, IMF, Bechtel should swim and drink in the polluted waters they have created. Evil, pure evil is the only word I can find in the language to describe them. Hague is appropriate for these criminals against humanity.
Evil: a crime in any fair and just society.
Sin: greed, a desire to do evil.
Darkness: an illusion of good hiding evil, a liar's pretense of good hiding his intent to do evil.
Good: a realization that this day of life is more then you deserve.
HAHAHAHA--ain't Global Finance Capitalism grand?
Unfortunately the elite is too small to irrigate and manure much desert with their blood.
I've noticed that generous, sometimes giveaway rates, are the norm for industrial and agribusiness water users.
Curtis' idea of "Peak Water" below--how about expanding it into mass piss-ins on Corporate HQ's (and heads too), Banks, etc.
Watch out for that yellow snow.
The amount of fresh water per person per year, falling on the earth, needs to be measured in acre-feet, or maybe in ponds.
The trouble is in getting water to the tap and then disposing of it. Humans need to drink clean water, free from carcinogenic chemicals and from parasites and bacteria. Plants can grow in bacteria-contaminated grey water that flows out of people's showers. House fires can be put out with brackish water as needed. Right now most American cities use one set of water pipes to provide all three water uses, and we use one set of sewer pipes for carrying all wastewater away.
It's costly to change our inefficient water systems because the roads above the pipes are constantly being used by motor vehicles, and any disruption of traffic is enormously costly.
Adding to the trouble is the unreliability of rainfall. Worse, pollution laws aren't really enforced and supplies get polluted. We drink a lot of chemicals in most American towns. Finally, municipalities usually let the water mains go until they break. So, our vital water systems get disrupted for all sorts of bureaucratic reasons.
The delivery and takeaway systems, and backup plans, are the real costs of water, except in a few Florida/California localities where they currently turn salt water to fresh.
The problem with our intensely complex water systems is that they are ripe for embezzlements of all kinds. Rich farmers steal water. Countries steal water from their neighbors. States write imperfect legal agreements with each other. We don't have a water problem, we have a justice problem.
We will solve our justice problem with more honest forms of government and of arbitration of highly technical issues, forms of government that we, the people, must and will develop.
Are you organizing a Piss-in soon?
Watering lawns, is not the same as drinking and bathing. Pools are a luxury. Industry can recycle much of their water, and bathwater can be used to flush a toilet. I would say that drinking and bathing ought to be nearly free, while commercial use such as agricultural watering ought to come in second, and luxuries such as pools, lawn sprinklers car washes, etc. ought to bear the brunt of the price. But, private corporations need to keep out of public water supplies. There is no room for profit. Water needs to be cheap for necessary usage. If the price is fixed high to discourage waste, the poor, as always, will be the ones to suffer.
Wouldn't this be an interesting headline: Economic and Corporate Powers Call for Population Control
People use very little water to drink and bath, compared to farming, so I would hesitate to tax water to higher cost levels such as what is being done to energy. It will indeed raise the price of water and living in general, but then will require subsidies for the poor to produce or buy food to eat or sell. In essense this would be a tax on 3rd world farming and food as well as an inhibiter of local jobs creation as well.
What will probably be proposed by the UN and pols is a massive gerryrigged system of subsidies and taxes that will direct water and monies to political entrepeneurs who will game the taxpayers for the pols pulling the strings and playing everybody. The failure of these schemes and their unintended consequences will then be blamed on some too big to fail politically connected entity and re-gerryrigged to fail at even greater expense and greater peril. Sort of like Fannie Mae and Freddie Mac and financial reform works is working out.
As for someone actually calling for population control.. just look at Paul Ehrlich's and John Holdren's book on same calls for... Even a sort of chemical castration for the populations who they want to control. Holdren is Obama's science advisor FYI
Apparently the big corporations owning the water sources are much more prepared to put a price on water, so profit from a tax for the consumers, than the big corporations that own the carbon sources of coal, oil and natural gas are prepared to have any sort tax on carbon, or the derived profits from either.
In our dying carbonated world, it is climate change combined with population growth that is going to kill people. Water supplies are going to dry up and millions will die of hunger through agricultural failure. The changes are expected continue past the threshold of human die off.
The price of water is a forlorn belief in the power of the market to overcome distribution and efficiency issues. The issue is that third world countries will not have the money to pay for water or food, whilst their crops grown with scarse water are shipped to the Carbonator nations, thus shipping the virtual water with the exported food. The water will be soaked up by the economically privileged , thus enabling us continue our unrestricted carbonation of the world.
''Major economies are pushing for substantial increases in the price of water around the world as concern mounts about dwindling supplies and rising population''
The Powerful Elite (of the world, America is merely a player) know the over-population of this planet will see the demise of all breathing things (i.e. including, of course, them). For, polluting of air water and soil is needed in ever-greater amount to feed the ever-increasing population.
The poisoning of water can be kept separate from their water supply. And blamed on 'terrorists'. Like Iraqis were blamed for 9/11 - what a FARCE that was.
Water....the most precious liquid on Earth. And men murder for oil. Well, that looks like changing.
''Abdullahoblongoda April 28th, 2010 5:43 pm
As for someone actually calling for population control.. just look at Paul Ehrlich's and John Holdren's book on same calls for... Even a sort of chemical castration for the populations who they want to control. Holdren is Obama's science advisor FYI''
I called it 'culling'. We are all aware of the 'rationality' of having to 'cull' animals that are spreading like a plague over Earth's fair face.
Hard to fault, huh? Unless you (me) are one of those being culled!
Watch what ya "cull" me, podner.
Many water utilities have fee systems that discourage conservation. For example, where I live, the minimum water billing is for 2,000 gallons a month. I generally use less than 500 gallons a month but I'm paying for 2,000.
Our water, pretreated, is pumped 25 miles up hill from a large aquifer. Our sewer rates are twice our water rates, while the sewer treatment plant is within the town.
If people payed close attention... Everywhere I've lived all over the U.S., utilities have had irrational rates. And, as someone earlier posted here, the advantage usually goes to the big, wealthy users.
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USA Inc. thinks oil was worth fighting over? And they want to own the water?
They are a lot dumber than I thought.
I find it interesting how the "powers that be" a.k.a. IMF, World Bank, WTO, WHO, and Co. use and twist information such as the ensuing crisis due to global warming, to further their own selfish greed driven agendas, when and where it serves them. I.e. the "need" to increase water prices [control] in order to promote conservation. And then deny the same information, i.e., global warming, when it interferes with their greed/profit driven world domination [damnation] agenda. We "rich, spoiled, westerners" use more than our fair share. The multinational corporate consortium, a.k.a. World Bank is more responsible for consumption, pollution, and destruction of world wide water resources than any single nation. As it is, the actions of these self-serving multinational corporations is what has put a price on water to begin with. Therefor these uber corporations should pay the price for improving water standards world wide. Why must so many suffer at the whim of so few? If "we" stop squandering "our" most precious resources and start using what we have more wisely and justly, "we" might find there is enough to go around. I believe, the technology to day, is such that it is possible that all may have enough.
In humane cultures water is communally owned, water = life. Not just human life, all life as we know it on Mother Earth. The idea that water can be owned is gross in and of itself. To me, it's an idea right up there with slavery and cannibalism. When are we humans going to learn we are one family, one home one destiny. Its high time we evolve beyond private resource ownership and own up to global stewardship. When are we going to stop incorporating and start cooperating? Nature has a way of "culling" those not willing to evolve. U.s. humans may drive, puns intended, ourserlves to extinction.
Whooya! Huzza! Cheers! Right on!
In an era of water privatization schemes all over the world, whereby a country can actually sell its water to a foreign multinational corporation for so called development funds, it is convenient to say that water prices need to go up.
"the OECD, which represents the world's major economies, issued three water reports calling for prices to rise. "Putting a price on water will make us aware of the scarcity and make us take better care of it," said Angel Gurría, the OECD secretary-general"
If a billion people do not have clean water, will that suddenly change if the price of water goes up?
Big agribusiness and big food producers need to be the ones to pay the price of water scarcity as long as they plant things in inappropriate places, and use up water in making their consumer products (as when Coca Cola in India both depleted and polluted the water table in Kerala, putting farmers out of business).
Water, the essence of life. Access should be free and it should be clean. Like any other commodity, it will be used by the haves to control the population of have-nots.
Find a copy of the FLOW - For the Love of Water video, see a trailer at: www.flowthefilm.com/trailer
You will never think about water the same again.
Also, see the 2008 Vancouver Internation Film Festival Audience Choice Award winner BLUE GOLD - World Water Wars. Now is the time to do something, tomorrow may be too late.
sheepherder asks:
"If a billion people do not have clean water, will that suddenly change if the price of water goes up?"
Good question.
Suggested answer from the article:
"In Manila, Manila Water increased bills from 4.5 to 30 pesos per cubic metre. At first there was resistance but by 2003 the company doubled connections from 3m to 6m, including 1.6m of the poorest squatters, leakage had been cut drastically, and pressure and quality had improved, said Rivera, one of the company's directors visiting Paris. Bills for the poorest households are now less than one-tenth of when they relied on vendors, and payment in the slum areas is 100%, said Rivera."
So, it depends on how the rates are structured and for whom. (I believe this issue is at least as important as oil...probably more so.)
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