Water Price Reforms in China: Policy-Making and Implementation

Abstract

Following the conviction that economic and pricing approaches are an essential addition to conventional command-and-control environmental regulation, China has gradually increased attention to, research on and experiments with the application of economic instruments in urban water management over the past two decades. This paper analyzes the actual application and implementation of economic instruments in Chinese urban water sectors, applying an ecological modernization perspective. Water tariffs in China have increased sharply over this period, increasingly representing full costs and increasing water use efficiency. But implementation of water tariffs does run into problems of unclear responsibilities, poor collection rates and institutional capacities. It is concluded that Chinese style ecological modernization should pay more attention to the institutional dimensions of natural resource pricing policies, if it is to profit from the theoretical advantages of economic approaches in urban water management.

Estimation of Rural Households’ Willingness to Accept Two PES Programs and Their Service Valuation in the Miyun Reservoir Catchment, China

“…To represent full costs and increase use efficiency, governments often adjust prices of public good or resource, such as a public transportation system [81,82], fossil fuels [83] and power [84]. Thus, associated with water price reforms in China [85], water tariffs were thought to be an effective tool to align water demand with supply and provide funding for the MRC restoration. Now, the water tariff in Beijing often has three components, payment for water used, a water resource fee, and a waste water treatment fee.…”

Assessment of Water Resources Carrying Capacity in Tianjin City of China

“…The researchers must be encouraged to find new or improved more efficient and implementable technological solutions for water saving (Xia et al 2007), wastewater reusing (Zeng et al 2008), reducing water consumption, improving water-use efficiency , transferring water and seawater desalination. And the government should try to improve efficiency of water conservation by popularizing the use of water-saving facilities and technologies in agriculture, industry and daily life; (d) Implement water tariff reforms (Zhong and Mol 2010), establish the scientific and rational water price system, and work out perfect laws and regulations system. As water resources are a kind of economic goods, to select appropriate water right and water price system can obviously improve the utilization efficiency of water resources (Jia et al 2002).…”

Water pollution during China's industrial transition

“…It should be noted that the class of "inferior to Grade V" was not adopted in the classification system until 1998. (Reddy, 2009;Xie et al, 2009;Zhong and Mol, 2010). It can also encourage the industrial and municipal sectors to enhance the treatment of wastewater for recycling and reuse.…”

“…Major advances have been made in increasing the water prices for urban users in China over the past two decades, while the pricing policies focused strongly on the pricing aspect, but not enough on the institutional aspects on effective policy implementation (Zhong and Mol, 2010). Due to the lack of corresponding institutional reforms, significant tariff increases have brought only slight improvement of urban water use efficiency in China Mol, 2008, 2010).…”