Subsidies for Succulents: Evaluating the Las Vegas Cash-for-Grass Rebate Program

Abstract

I estimate the water savings, energy use externalities, and property value effects of a Las Vegas area water conservation program that subsidizes conversions of lawn to desert landscape. Using event studies and panel fixed-effects models, I find that the average conversion reduces water use by 19%-21%, may increase energy use by 3%, and increases property values by about 1%. In addition, my results demonstrate that there is little erosion in water savings, that water savings are inversely proportional to annual program take-up, that participants with high preconversion water demand save the most water, and that a 4% price increase would have achieved equivalent savings. I find little evidence of property value spillovers to neighboring properties.

Colorado Basin Incentive‐Based Urban Water Policies: Review and Evaluation

“…Several evaluative studies of the Las Vegas Water Smart Landscapes are summarized here. Baker (2021) and Brelsford and Abbott (2021) found the program reduced water use among participants by 19%–21%. Each study also examines program costs.…”

“…Based on our review of evaluation studies for CRB urban water conservation programs, cost‐effectiveness emerges as the most useful and implementable criterion when evaluating programs to reduce urban use. Cost‐effectiveness has been employed in many other evaluations (Baker 2021; Brelsford and Abbott 2021). Total cost per unit of reduced water use is a useful way to measure cost‐effectiveness.…”

“…Baker estimates program costs by adding administrative costs and rebate outlays, with these costs ranging from $2.65/kilogallon to $3.31/kilogallon, less than the cost of added water supplies. Baker calculates the cost of added water supplies based on agricultural to urban water sales (Baker 2021). Brelsford and Abbott (2021) find a consistent program cost of $3.37/kgal across a 10‐year timescale, calculating this cost using dollars spent on the program.…”

“…Brelsford and Abbott (2021) find a consistent program cost of $3.37/kgal across a 10‐year timescale, calculating this cost using dollars spent on the program. Net benefits per square foot of converted land equaled $2.35–$2.88/square foot (Baker 2021). Baker estimated net benefits by subtracting the administrative and conversion costs from the sum of the direct effect of conversion and the value of scarce water.…”

Water‐Use Data in the United States: Challenges and Future Directions

“…In the 1980s, the digital computer era enabled a new generation of federal surveys and data collection focused on understanding the nation's water use. Urban water conservation gained traction in the 1990s through new regulations and incentives on water‐efficient appliances, fixtures, and landscapes (Vickers 2001; Baker 2021). At the same time, the WateReuse Association (watereuse.org) was established to promote water recycling as a means to gain additional utility from every drop of water.…”