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Demand Management Factors in Residential Water Use: The Southern Arizona Experience
Two models of residential water demand were run with data from three water utilities in the Tucson, Ariz., metropolitan area to estimate the response of water use to variations in price, household income, and a variety of socioeconomic and climatic variables. The study covered a period when all three utilities experienced substantial reductions in residential water use. All three utilities examined imposed availability‐of‐service charges, and the largest utility used increasing‐block rates and seasonal rates. Because of disagreement in the literature about the proper specification of price under these conditions, demand models were estimated using both the traditional average‐price variable and the marginal price plus rate premium. Estimated long‐term price elasticities for the combined time‐series‐cross‐section models averaged ‐0.72, and they varied depending on model specification and time period. Individual demographic district elasticities were also estimated. Several principles of conservation pricing and other aspects of demand management for water utilities are discussed.
Demand Management Factors in Residential Water Use: The Southern Arizona Experience
Two models of residential water demand were run with data from three water utilities in the Tucson, Ariz., metropolitan area to estimate the response of water use to variations in price, household income, and a variety of socioeconomic and climatic variables. The study covered a period when all three utilities experienced substantial reductions in residential water use. All three utilities examined imposed availability‐of‐service charges, and the largest utility used increasing‐block rates and seasonal rates. Because of disagreement in the literature about the proper specification of price under these conditions, demand models were estimated using both the traditional average‐price variable and the marginal price plus rate premium. Estimated long‐term price elasticities for the combined time‐series‐cross‐section models averaged ‐0.72, and they varied depending on model specification and time period. Individual demographic district elasticities were also estimated. Several principles of conservation pricing and other aspects of demand management for water utilities are discussed.
Demand Management Factors in Residential Water Use: The Southern Arizona Experience
Billings, R. Bruce (author) / Day, W. Mark (author)
Journal ‐ American Water Works Association ; 81 ; 58-64
1989-03-01
7 pages
Article (Journal)
Electronic Resource
English
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