consumption tax

Why Cochrane’s 3-tier water rate is awesome…

A recent article in the Cochrane Eagle caught my attention. It appears that water usage and the 3-tier water rate structure is back in the media, championed by Councillor Toews.

Here’s why this “consumption tax” is so awesome (pictures say it best, borrowed from this report);

Typical water rates

And here’s the corresponding graph of usage (take special note of France);

Daily domestic water use

Councillor Toews’ position that the 3-tier water rate is an “attack” (interesting choice of words, very passionate obviously) on families and business is difficult to defend.

Firstly, consumption taxes are progressive, not regressive. Progressive means the more you use, the more you pay. This model is LOVED by environmentalists and economists alike.

Secondly, the base allotment of water (25 cubic meters, or 25000L/month) works out to 833L/day/household at the base rate of $1.07. That means we pay $0.00107/L for those first 25 cubic meters. Taken in the context of what the United Nations suggests as the freshwater required to meet basic sanitation and household needs (20-50L/water/day), suddenly that number of 25000L looks awfully large.

Finally, 89% of the water users in Cochrane fall within the base amount every month. 89%. Who is being represented when the tiered water structure is being publicly questioned? The 11% of the population with an acre of Bermuda shortgrass that they want to keep green and trimmed? Might I suggest xeriscaping (we do live in a semi arid zone, after all).

My solution?

  • Provide every household 50L/day/person FREE of charge. That’s right. Totally free. You’ve got 8 kids? Great, here’s 500L/day for your families needs. Water is a basic human right after all.
  • After that 50L/day is used up…charge the crap out of it. I’m talking 2-3 times what we currently pay. Rates like that of Germany.

What would this accomplish? First of all, everyone’s basic human right to clean water for sanitation and hygiene would be taken care of. This should satisfy those who worry about families under attack. It would also provide a significantly increased economic incentive to cut down on water consumption. What if everyone cut their water usage so drastically that the town stopped collecting water revenue?

You mean, what would happen if we cut our water use from 243L/day in 2004 to 50L/day in 2015? Well, we’d be a model of sustainability for municipalities everywhere on the planet.

Not a bad problem to have.

From a trip on the Athabasca River, where water quality is a much bigger concern than down here on the Bow, where quantity is the issue