Context and objectives

In Europe, several river basins face high level of water stress, in particular in dry and irrigation-intensive river basins in Southern Europe and hot-spots around urban centers. In the future, it is likely that predicted climate change will exacerbate this situation. In that context, several European Member States are progressively developing and implementing water demand management policies.In the urban sector, economic instruments, such as tariffs and taxes, are increasingly used to incentivize water conservation practices. In agriculture, the most common approach consists in rationing water use through the establishment of a system of quotas, which are often defined based on historical water uses. This administrative allocation mechanism has been criticized by some economists who consider it as economically inefficient. They suggest that water quotas should become tradable in order to allow water to be reallocated from low to high added value uses. Such water markets already exist in countries like Australia, Chile, USA and, since 1999, Spain.

In its “Blue Print to safeguard Europe’s water resources” (2012), the European Commission suggested that water trading could be included in water managers’ tool box. For many countries where water is currently considered as a public trust and its allocation ruled by administrative procedures, making water quotas tradable would be considered by stakeholders and the society as a whole as a real shift in paradigm. The water trading perspective raises a number of questions related to the expected economic gains; the social and territorial impacts; the cost of establishing such a system; the most appropriate institutional set-up; and the social and political acceptability of this instrument. It also calls for a comparison with alternative approaches relying on cooperative and contractual mechanisms.

This seminar will address these issues by creating a dialogue between researchers, policy makers and water managers coming from various European countries. It will be organized by Onema and the French geological survey (Brgm). Case studies conducted in France, Italy and Spain will be presented and used as a basis for discussion during round tables. Participation is limited to 60 persons in order to create the conditions required for high quality debate. The outcomes of the workshop will be summarized in a short publication edited by Onema.

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