A comparative analysis of water pricing options on two large-scale irrigation schemes in West Africa

Abstract

Large-scale irrigation schemes producing food and commercial crops in West Africa typically charge a flat rate per hectare for water use. Economic theory suggests that this pricing system is ineffective in promoting efficient water use practices that value water as an economic good. With looming water scarcity partly due to climate change and partly because of growing demands for water due to population, urbanization and industrial-sector growth, there is mounting pressure for implementation of pricing systems that would promote efficiency and cost recovery on irrigation schemes. This paper evaluates the merits of volumetric water pricing system, as an alternative, to the flat rate area-based pricing system currently in use in Office du Niger (ON) irrigation scheme in Mali and Bagre irrigation scheme in Burkina Faso. Results showed that, in contrast to the current situation, adoption of a uniform volumetric water pricing system will enable both schemes to cover the cost of water supply but impact on total water consumption and farmers’ profit will differ by scheme, with Bagre scheme adversely affected. Adoption of an increasing block tariff volumetric system in Bagre will ameliorate the negative effects, suggesting the need for context-specific rather than blanket prescription of a water pricing system.