The Role of Tariffs in Reducing Residential Water Demand in Qatar

Abstract

Qatar is a hyper-arid country located in the Middle East suffering extreme water scarcity. More than 99% of municipal demand comes from seawater desalination while existing groundwater reserves are under severe pressure from over-abstraction. Despite these water resource limitations, per capita water demand is amongst the highest globally with recent Ministry of Development Planning and Statistics values placing per capita consumption at roughly 550 L/p.d in 2014. Such high demand could be due to a variety of cultural, social and political factors. The Qatar population is unique in its composition, with roughly 85% of the population being non-citizen residents coming from a diverse set of cultures including a large portion of low-skilled labourers. Therefore, promoting conservation in a consistent and effective manner can be challenging. The high average personal wealth in the country may also lead to greater luxury use of water. Cultural and environmental issues may also play a key role. For instance, the majority of the population are adherents of Islam, which has strict ablution requirements for purification prior to prayer and holds a high regard on cleanliness, which in the extreme weather conditions of the Arabian Gulf leads to increased water use for washing. However, the traditional welfare orientated governance of the Gulf States is frequently regarded as a primary cause for high water consumption prevalent in the region. Qatari citizens are granted tariff free use of domestic water on one dwelling while historically residents have been offered a heavily subsidized flat rate of only 4.40 QAR/m3 ($1.21 USD/m3). In 2015, the countries sole water utility provider, the General Electricity and Water Company (Kahramaa), revised the tariffs to various user groups including residents who now pay a tiered structure which still starts at 4.40 QAR m/3, but rises to 5.40 QAR/m3 after the first 20 m3 and has a final tier rate of 9.40 m3 reflecting a cost close to the true cost for supply. This study evaluated the effectiveness of this tariff restructuring by assessing changes in water consumption before and after the tariff changes across 547 residential properties including citizens and residents; flats and villas, and rented vs owned. Metering data was provided directly by Kahramaa following screening to ensure the same tenant was registered for two full years, one year prior and one year following the price restructuring. Data was analysed using SPSS statistical software (IBM), using non-parametric methods due to non-normality of the data. It was found that a statistically significant reduction in water consumption occurred following the tariff restructuring with a total reduction of 17% observed. Surprisingly, the most significant reductions were observed among Qatari rented flats, with resident rented flats and villas the next most responsive to tariff changes. The responsiveness of users was also assessed based on their previous water consumption by considering three groups, low water users (set as the 10th percentile users), medium water users (set as the median water users) and high water users (set as the 90th percentile users). While response varied significantly among household tenant types, overall it was found low water users responded significantly more to the changes in tariffs. This study highlights the importance of tariff use in Qatar as one effective tool to complement a broad and holistic approach to bring domestic water consumption to more sustainable levels and highlights the role tariff changes have on even those exempt from tariffs, possibly through increased discussion, awareness and feeling of responsibility.