Water Pricing: how to value our most elusive resource


Stockholm Water Front No. 4 2013 article
Water Pricing: How to value our most elusive resource by Mr. Jens Berggren, SIWI.

Around 2,500 years ago the Greek philosopher Plato stated that “Only what is rare is valuable, and water, which is the best of all things…is also the cheapest”. In 1779, Adam Smith coined a famous paradox between value and utility, comparing diamonds, valuable but useless, with water, useful but worthless. But in the last few decades, something happened.

To manage the rise in demand for water and to increase water productivity, incentives for using water more efficiently will be necessary. Water pricing is increasingly seen as a necessary tool. In this article, SIWI’s Mr. Jens Berggren sets the scene by describing the intricacies of potential water pricing – how does one price one of our most elusive resources? The issue is immensely complicated, but necessary to tackle.