Paying too much or too little? Pricing approaches in the case of cross-border water supply

Abstract

Abstract Cross-border drinking water supply is often a solution for the emerging water crisis, related also to climate changes, but in several cases also a historical legacy of changing borders. It is challenged by the increased complexity of water supply management, mainly because of the doubled reality of administrative, legal, accounting and decision-making processes. Analyzed water pricing of existing cross-border utilities clearly demonstrates applied water pricing approaches mainly based on pure negotiation principles demonstrating different and often heavily asymmetric bargaining positions of partners. In order to overcome this situation applicable water pricing principles are presented. The model is demonstrated on real business cases of three water utilities from Central and South East Europe, but similar concepts are applicable for drinking water transfer between regions or municipalities in other countries.