Novel Water Pricing Model for Water Network Projects: A Case Study of Jiaodong Water Diversion Project in China

Abstract

The uneven distribution of water resources in time and space restricts the development of society, which is a universal problem facing the world. To improve the ability to regulate water resources in water diversion projects and alleviate the contradiction between water resources and social development, China has decided to build water network projects (WNPs). A WNP is an integrated water supply system that includes multiple water sources and network water supply lines and integrates the functions of water supply, water delivery, and optimal allocation of water resources into a system that can supply water to many users. An appropriate water pricing mechanism is the key to ensuring the sustainable operation of water network projects. This paper presents a comprehensive water pricing model (WPM) for WNPs. The purpose of this model is to unify the water price measurement standard of WNPs and lay the foundation for water price marketization in the future. By applying the model to the Jiaodong WNP, it is found that the model is expected to improve the unbalanced use of water sources and the large difference in prices at water supply points (WSPs) in the project. This study not only provides a theoretical basis for water pricing reform but also has great potential to improve the efficiency of water resource use.