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Groundwater Pricing Policies in the Practice of Groundwater Over pumping Control in North China Plain

IWRA 2020 Online Conference - Addressing Groundwater Resilience under Climate Change
THEME 4. Groundwater Governance, Management and Policy
Author(s): Yan Yang, Lili Yu, Fei Chen, Yueyuan Ding

Ms. Yan Yang, Prof. Lili Yu, Dr. Fei Chen, Prof. Yueyuan Ding
General Institute of Water Resources and Hydropower planning and design, MWR China 2020.10

Keyword(s): Groundwater price, over-pumping governance


(a) Purpose or objectives and status of study or research hypothesis

This presentation will introduce the pricing system and related policies, especially the groundwater price for agricultural use, that has been established paralleling with the implementation of a series of groundwater over-draft governance actions in North China plain. The objective of this work is to answer why the past water pricing policy should be changed or supplemented and explore how to build a new and effective pricing system to replace the old one with the consideration of gain and loss from all levels of administers and stakeholders.


(b) Key issue(s) or problem(s) addressed

With the proceeding of groundwater overdraft control actions, the price policy has played a supporting role in the practice of groundwater overdraft control in NCP. We could see that some ongoing groundwater overdraft control methods, such as water source replacement or fallow could directly reduce or discourage the consumption of groundwater. But the water price, as one of economic instruments, works indirectly to reduce groundwater pumping rate and try to affect people’s choice by forcing them to evaluate the tradeoff they are facing. In this way, the way of how people value and use water could be changed. This work tries to figure out to which degree economic instruments like water price could affect people’s behavior and choices to save water.


(c) Methodology or approach used

Hebei Province, located in the middle of NCP and suffers severe groundwater over-pumping problem over years, has been selected as the first pilot region for water price reform, making it possible to test how the new price system runs and whether it have fulfilled the goal of water saving. The new water pricing system is composed of three parts: water price standard frame, water monitoring system and water fee collection system, which works together to serve the same purpose: reward the water saving and dampen the over-pumping. This work tries to focus on the implementation process of new water price policy and evaluate the effectiveness of new water pricing system by comparing the new pricing system with the old one from aspects of saved amount of groundwater, maintenance of water diversion projects, farmers’ willingness to cooperation and the sustainability of water price policy. The evaluation has used data from official source and field investigation, such as water use amount, water fee collected, electricity consumption, etc.


(d) Results and conclusions derived from the project

Firstly, reasonable water price could effectively encourage water saving behavior, but with the prerequisite of accurate water resources monitoring and metering system and efficient water fee collection system. So water price could not work alone and supporting methods or policy is also needed. Secondly, the allocation of water fee collected, water saving bonus and subsidies among different water using entities could largely affect the sustainability of the water price


(e) Implications of the project relevant to selected conference theme, theory and/or practice

This work summarizes the experiences and lessons from the ongoing practice of water price reform in NCP. As a part of groundwater over-pumping governance system, the new water pricing system is expected not only to force people make smart choice when they make decision, but also affect people’s habit to save water from the very beginning. From this perspective, water price’s effect on water resource could not be limited with the over-pumping governance, but should be a key issue of sustainable management of water resources.

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