American Society of Civil Engineers Riegels, N.; Pulido-Velazquez, M.; Doulgeris, C.; Sturm, V.; Jensen, R.; Moller, F.; BauerGottwein, P. (2013) Under the first approach, all wholesale water users in a river basin face the same volumetric 26 price for water. This water price does not vary in space or in time, and surface water and 27 groundwater are priced at the same rate. Under the second approach, surface water is priced 28 using a volumetric price, while groundwater use is controlled through adjustments to the price of 29 energy, which is assumed to control the cost of groundwater pumping. For both approaches, 30 optimization is used to identify optimal prices, with the objective of maximizing welfare while 31 reducing human water use in order to meet constraints associated with EU WFD ecological and 32 groundwater sustainability objectives. The second pricing policy, in which the energy price is 33 used as a surrogate for a groundwater price, shifts a portion of costs imposed by higher water 34 prices from low value crops to high value crops and from small urban/domestic locations to 35 larger locations. Because growers of low value crops will suffer the most from water price 36 increases, the use of energy costs to control groundwater use offers the advantage of reducing 37 this burden. 38
In addition to population increases, water use in the Santa basin may change. Higher temperatures and lower precipitation in the dry season could lead to more of the flow in the dry season being extracted for irrigation purposes. Economic development in the Santa basin may also increase pressure on the water supply, especially if agriculture in the basin is developed and new intakes for irrigation are planned from the river upstream of the CHAVIMOCHIC intake.
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