Mark Griffin Smith

ANALYSIS OF SHORT-RUN DOMESTIC WATER SUPPLY TRANSFERS UNDER UNCERTAINTY

From the perspective of water supply managers, supply reliability can be more important than economic benefit. This study uses four alternative models of water supply allocation to examine issues of reliability and welfare maximization arising from short-run inter-city water transfers. The results of this work show that the economic gain from water transfers may be relatively small. However, water transfers can significantly improve system reliability, thus providing strong incentives for transfer arrangements among water authorities. We apply the models in a case study on the island of Cyprus.

StreamPlan : A Support System for Water-Quality Management on a River Basin Scale

Abstract StreamPlan was developed as an integrated, easy-to-use software system for analysing alternative water quality management policies on a river basin level. These include uniform emission reduction and effluent standard based strategies, ambient water quality criteria and least-cost strategies, total emission reduction under minimized costs, mixed strategies, local and regional policies, and strategies with economic instruments. A distinctive feature of StreamPlan is the integration of a detailed model of wastewater generation on the municipal level with water quality modelling and policy analysis tools on a river basin scale. StreamPlan allows the modelling of cost and abatement efficiency of different wastewater treatment plant upgrading schemes based on projected wasteloads and a description of existing facilities. StreamPlan is composed of six spreadsheet workbooks and an external linear programming package. The power and familiarity of spreadsheet operations enhance ease of use. The spreadsheets own programming language seamlessly integrates databases and models in workbooks and worksheets into a complete system. Moreover, the total development time for the system was just over one person year.

Innovative Tools for Water Quality Management and Policy Analysis: Desert and Streamplan

This paper presents the major features of two decision support systems (DSS) for river water quality modeling and policy analysis recently developed at the International Institute of Applied Systems Analysis (IIASA), DESERT and STREAMPLAN. DESERT integrates in a single package data management, model calibration, simulation, optimization and presentation of results. DESERT has the flexibility to allow the specification of both alternative water quality models and flow hydraulics for different branches of the same river basin. Specification of these models can be done interactively through Microsoft® Windows commands and menus and an easy to use interpreted language. Detailed analysis of the effects of parameter uncertainty on water quality results is integrated into DESERT. STREAMPLAN, on the other hand, is an integrated, easy-to-use software system for analyzing alternative water quality management policies on a river basin level. These policies include uniform emission reduction and effluent standard based strategies, ambient water quality and least-cost strategies, total emission reduction under minimized costs, mixed strategies, local and regional policies, and strategies with economic instruments. A distinctive feature of STREAMPLAN is the integration of a detailed model of municipal wastewater generation with a water quality model and policy analysis tools on a river basin scale.

Price determination and efficiency in the market for water rights in New Mexico's Middle Rio Grande Basin

Water rights markets in the western United States have expanded over the last 40 years, as a result of population growth in the West and Southwest, and limited development of new storage. Until 2008, house prices, home construction and population growth appeared to be locked in an ever-increasing upward trend. With little historical experience to the contrary, water right market prices similarly appeared to be driven by real estate development. The collapse of the housing market in the last four years provides an opportunity to examine the connection between the real estate and water markets. It is found that Middle Rio Grande Basin water right prices are influenced by housing prices, per capita income in the buyers county, buyer type, point of diversion, and transaction volume. However, significant price dispersion remains, raising the question of how efficiently this market is currently working.

Price Determination and Efficiency in the Market for South Platte Basin Ditch Company Shares

Water scarcity presents an obstacle to economic development in the western United States. Water right markets promote efficient allocation, helping states to derive the highest possible economic benefit from available resources, and allowing western water supplies to support new development and population growth. However, uncertainty surrounding water right market values threatens the ability of water markets to efficiently allocate water. To address this problem, we employ econometric analysis techniques to estimate the values market participants place on shares of ditch company water rights in Colorado’s South Platte basin. Our analysis demonstrates that ditch company share buyers value proximity, reliability, and flexibility.

The Influence of the Real Estate Market on Water Right Values in New Mexico’s Middle Rio Grande Basin

Water markets in the western United States have expanded over the last 40 years driven by two forces – population growth in the West and Southwest and limited development of new storage projects. Until 2008 house prices, home construction and population growth appeared to be locked in an ever-increasing upward trend. With little historical experience to the contrary, water market prices similarly appeared to be driven by real estate development. The collapse of the housing market in the last three years provides an opportunity to examine the connection between the real estate and water markets.

The State of the Art in Economic Instruments and Institutions for Water Quality Management

The United States and the Western European countries control water quality using a variety of instruments and institutions. These tools range from regulatory command and control (CAC) approaches of technological, emissions and ambient standards to economic or incentive-based approaches such as charges, subsidies and transferable discharge permits (TDPs). As the economies of the CEE countries move from central planning to the free market, it is appropriate to review both the literature on and experience with economic instruments for water quality management to understand how they might be applied in that setting. The Central and Eastern European countries face serious water quality problems and the resources needed to address these problems are large (Somlyody, 1993). The challenge of improving water quality in CEE requires finding cost-effective approaches that are appropriate to the institutional context of individual CEE countries.