Price Analysis of Water Supply for South-to-North Water Transfer Project

The factors influencing the water supply price of a hydraulic project include natural conditions and economic policies. This paper thoroughly demonstrates the water price of South-to-North Water Transfer Project from the viewpoint of economic policies. It is considered that if the project is assigned as a profitable one and built depending on commercial loan from bank completely or mostly, the water price will be too high to be undertaken by users,and if the project places the public good at first while considering the economic benefit, its investment mainly relies on the state (national or local governments) appropriation and self-raised funds and a little from the bank loan on favorable terms, the price determined according to the principle of satisfying the cost and reasonable profit will be relatively lower and can be undertaken by the users in the North China where water shortage is serious. The problem of higher water price of agricultural irrigation to the north of the Yellow River can be tackled by taking measures such as "compensating agriculture by industry" according to foreign practical experiences and relevant suggestions.