Paying the price for water conservation: Assessing the potential of a water chain tariff on water conservation in the Noord-Brabant region, The Netherlands

Abstract

In the Netherlands, the need for water conservation is growing due to more frequent droughts, increasing drinking water demand, and escalating pressure on regional groundwater reserves, particularly in Noord Brabant. Current flat rate pricing systems offer little incentive for households to reduce water demand, even as environmental and financial challenges intensify. Although volumetric pricing is used in several countries, there is limited empirical research on integrated water chain tariffs in the Dutch context. Existing studies often rely on international examples and do not evaluate how combining drinking water, sewerage, and wastewater treatment costs into a single water demand-based tariff might influence household behavior or align with national policy goals.

This study aims to assess the potential of a water chain tariff as an instrument for household water conservation in Noord Brabant. It examines the effectiveness, affordability, and feasibility of such a tariff, with reference to key principles such as cost recovery, affordability, and the polluter pays principle. A mixed methods approach was used, including scenario based financial modeling, demand elasticity analysis, and interviews with stakeholders from municipalities, regional water authorities, and the drinking water utility. Five pricing scenarios were developed and analyzed to evaluate revenue outcomes, behavioral impact, and administrative challenges.

The results indicate that an early differentiated volumetric tariff could reduce household water use by up to 15%, while maintaining cost recovery and affordability. However, implementation would require overcoming legal constraints, institutional fragmentation, and data limitations. While the study is grounded in the specific context of Noord Brabant, the findings offer valuable insights for broader tariff reform efforts across the Netherlands, where similar challenges and conservation goals apply. Tariff reform alone cannot resolve water scarcity, but it can contribute meaningfully to a more integrated and sustainable approach to water demand management.