Price and Behavioural Signals to Encourage Water Conservation

The global problem of water resource constraints is pertinent to the UK and particularly acute in the south and east of England. A greater emphasis is being placed on water demand management in the UK, with a need to find a balance among social, environmental, economic and political goals. Putting a price on water is conceptually straightforward but often challenging in implementation. As water bills are typically small relative to household income in the UK, expenditure-led incentives may be insufficient, and so it is important that attitudeled behavioural interventions are also considered for conservation purposes. There is increased penetration of water meters in the UK and there is evidence that metering in itself leads to greater awareness of water use. Development and introduction of conservationoriented tariffs and behavioural interventions to manage demand have been modest compared to in some other locations. Also, there is a lack of evidence of how tariff signals and behavioural signals interact in the UK. This report reviews international experience of price and non-price approaches to manage residential water demand, with a focus on drawing insights regarding the effectiveness of Increasing Block Tariffs and information-based behavioural interventions. It then offers some insights on the extent to which lessons from elsewhere may be transferable to the UK context.