Water price elasticity and public acceptability on conservation options in the city of Volos, Greece

Abstract

Efforts to satisfy increasing demand have often been concentrated principally on constructing new water systems, thus increasing the supply of water. The relationship between water abstraction and water availability has turned into a major stress factor in the exploitation of water resources. There is a wide recognition nowadays that there is a need for strategies for the sustainable use of water resources and water demand management. In the city of Volos, Greece, the number of water meters has been tripled from 1979 to 2006 while yearly water production has increased 2.62 times these 27 years. The fact that water sources have remained stable has created a disruption of water balance. In order to explore new approaches toward sustainable water management in the water supply sector, evaluate various aspects of current water policy, investigate the perspectives of water saving and evaluate water price elasticity in the city of Volos, Greece, a survey concerning the residential sector has been performed recently. All qualitative data were gathered through questionnaire with the method of personal interview. The questionnaire examines social features of consumers, water use patterns, water conservation methods, water pricing issues and the level of water services. Water quality, water demand and water availability issues, waterrelated problems, as well as public information concerning water and environmental issues, public reactions to price changes and public willingness to pay in the residential sector are the main aspects examined and analyzed. The influence of some selected variables in water conservation, such as the price of water, the size of the dwelling, the indoor and outdoor uses, the educational level, the income of consumers as well as rainfall and temperature levels, is examined, hierarchically set and residential water demand curve is calculated using the fixed effects and random effects model.