Conjunctive use of surface water and groundwater with quality considerations

Deterministic models of conjunctive surface and groundwater management aren’t much more complicated than typical groundwater-only management models under simple assumptions. However, when water quality problems exist, the fact that there are two alternative sources of water gains a new significance, as there is no guarantee that they will be of comparable quality. Thus the benefit from using one unit of surface water may not be the same as that of one unit of groundwater. This paper analyses the implications of considering a conjunctive ground and surface water system where water quality varies according to source, with and without uncertainty in hydrological parameters.

Joint Quantity/Quality Management of Groundwater

WOS:000185261800006 (Nº de Acesso Web of Science)Economic literature on groundwater managementhas traditionally been split into two areas: there are papers that evaluate different schemes of dynamicaquifer management, considering that pumping costs vary with stock but ignoring water quality. On the other hand, there are papers that considercontamination problems caused by specificpollutants. This paper presents two alternative models for joint quantity-quality management, and it shows that existing models are in fact special cases of these. The framework isdynamic and considers both the stock of waterquantity and a stock measure of water quality. Optimal taxes are derived, and shown to be different from those in existing quantity-only or quality-only models. Implementationproblems are briefly discussed

Pricing for Scarcity

In many areas where water is not abundant, water pricing schedules contain significant nonlinearities. Existing pricing literature establishes that efficient schedules will depend on demand and supply characteristics. However, most empirical studies show that actual pricing schemes have little to do with theoretical efficiency results. In particular, there are very few models recommending increasing blocks, whereas we present evidence that this type of tariff structure is abundantly used. Water managers often defend increasing blocks, both as a means to benefit smaller users and as a way to signal scarcity. Naturally, in the presence of water scarcity the true cost of water increases due to the emergence of a scarcity cost. In this paper, we incorporate the scarcity cost associated with insufficient water availability into the optimal tariff design in several different models. We show that when both demand and costs respond to climate factors, increasing marginal prices may come about as a combined result of scarcity and customer heterogeneity under specific conditions. We also investigate the effect that rising water scarcity in the long run can have on the steady-state amount of capital invested in water storage and supply infrastructures and obtain some results that are consistent with the static models.water pricing; nonlinear pricing; increasing block tariffs; water scarcity

Instabilities and Robust Control in Fisheries

Demand and supply analysis in fisheries often indicates the presence of instabilities and multiple equilibria, both in open access conditions and in the socially optimal solution. The associated management problems are further intensified by uncertainty on the evolution of the resource stock or on demand conditions. In this paper the fishery management problem is handled using robust optimal control, where the objective is to choose a harvesting rule that will work, in the sense of preventing instabilities and overfishing, under a range of admissible specifications for the stock recruitment equation. The paper derives robust harvesting rules, leading to a unique equilibrium, which could be used to design policy instruments such as robust quota systems.Fishery Management, Multiple Equilibria, Instabilities, Robust Control, Robust Harvesting Rules

Pricing for scarcity? An efficiency analysis of increasing block tariffs

WOS:000291852700001 (Nº de Acesso Web of Science)“Prémio Científico ISCTE-IUL 2012”Water pricing schedules often contain significant nonlinearities, such as the increasing block tariff (IBT) structure that is abundantly applied for residential users. The IBT is frequently supported as a good tool for achieving the goals of equity, water conservation, and revenue neutrality but seldom has been grounded on efficiency justifications. In particular, existing literature on water pricing establishes that although efficient schedules will depend on demand and supply characteristics, IBT cannot usually be recommended. In this paper, we consider whether the explicit inclusion of scarcity considerations can strengthen the appeal of IBT. Results show that when both demand and costs react to climate factors, increasing marginal prices may come about as a response to a combination of water scarcity and customer heterogeneity. We derive testable conditions and then illustrate their application through an estimation of Portuguese residential water demand. We show that the recommended tariff schedule hinges crucially on the choice of functional form for demand

Portuguese Water Supply and Sewage Tariffs Report

The tariffs applied in the Portuguese water industry are very complex, making their analysis difficult and hampering the objective of efficiency, acknowledged as an important tool in water management by Portuguese and European legislation. In this article we present the main criteria to be taken into account when choosing a tariff scheme, emphasising those which regard economic efficiency and financial stability of water utilities. We then analyse the existing Portuguese water supply and wastewater drainage and treatment tariffs based on the information provided by the National Inventory of Water Supply and Wastewater Systems and compare the results obtained with the aforementioned objectives, stressing the distance between them.Water supply; Wastewater drainage and treatment; Tariffs

Sectoral and regional impacts of the European Carbon Market in Portugal

Across Europe, CO2 emission permits represent one of the main policy instruments to comply with the limits established by the European Commission to achieve the goals of the Kyoto Protocol. In this paper we use microdata to address two issues regarding the impact of the European Carbon Market (EU ETS). On the one hand, we analyse the sectoral effects of the EU ETS in Portugal. The main goal is to study the outcomes of this policy in terms of the transactions carried out between sectors, as well as the distributive consequences. On the other hand, we also look at the regional impact. The pre-existing specialization of different regions in the production of different goods and services might lead to an uneven economic impact of the new permit market. In particular, Portuguese data indicate a distribution of revenue from low income to high income regions, or rather, between installations located in those regions. We focus on the first two years of operation of the EU ETS, using data for each one of the 244 Portuguese installations regulated by this market as well as financial data for 80% of these installationsRegional impact, sectoral impact, tradable CO2 permits, European Carbon Market.

On the Effect of Technological Progress on Pollution: a New Distortion in an Endogenous Growth Model

We derive a model of endogenous growth with physical capital, human capital and technological progress through quality-ladders. We introduce welfare-decreasing pollution in the model, which can be reduced through the development of cleaner technologies. From the quantitative analysis of the model we show clear evidence that the new externality from technological progress to pollution considered in this model is sufficiently strong to induce underinvestment in R&D as an outcome of the decentralized equilibrium. An important policy implication of the main result of this article is a justification to subsidize the research in cleaner technologies.Environmental Pollution, R&D, Social Capital, Human Capital, Economic Growth

Impostos ambientais e o duplo dividendo: experiências europeias

reforma ambiental, duplo-dividendo, desemprego, poluição, impostos ambientais, impostos sobre o trabalho

Caracterização dos tarifários de abastecimento de água e saneamento em Portugal

The tariffs applied in the Portuguese water industry are very complex, making their analysis difficult and hampering the objective of efficiency, acknowledged as an important tool in water management by Portuguese and European legislation. In this article we present the main criteria to be taken into account when choosing a tariff scheme, emphasising those which regard economic efficiency and financial stability of water utilities. We then analyse the existing Portuguese water supply and wastewater drainage and treatment tariffs based on the information provided by the National Inventory of Water Supply and Wastewater Systems and compare the results obtained with the aforementioned objectives, stressing the distance between them