13 February 2008

Lake Mead in Trouble

The drought and higher water consumption is lowering the level of the lake behind Hoover Dam. A study released today
gave a 10 percent chance that functional storage in Mead and Powell reservoirs will be gone by 2013 and a 50 percent chance that it will disappear by 2021. They said there's a 50 percent chance that the minimum power-production levels in both lakes will be reached in 2017, based on current trends.
I was amazed and depressed to see NO MENTION of raising the price of water. Advertising, yes; rationing, yes; desalination, yes. When are they going to raise prices! ARG!

2 comments:

Michael Ejercito said...

Why is it that oil companies easily raise prices if there are rumors that supplies would be restricted, but water companies apparently have no idea of how to raise prices?

David Zetland said...

Water utilities are regulated. (Bottled water and gas are not.) If they are public, the municipality regulates; if they are private, the CPUC regulates.

Remember the 2001 California energy crisis? That was because wholesale prices were deregulated but retail prices were not.

Water prices *can* rise with regulatory permission (shortage is a good excuse), but many regulators are allergic to scarcity pricing of water.