Alternative tariff structures and household composition: Evidence from Spain's Valencia region

Water pricing is one of the fundamental tools for water resources management. However, the current tariff structure in Spain has associated problems in relation to the composition of households. This paper analyses the current tariffs of Spain's Valencia region and studies the effect of alternative tariff structures. The results show an imbalance irrespective of the tariff applied even when the number of household members is considered, as the relationship between the number of household members and water consumption is not linear. Therefore, the problem is not the tariff structure per se but not including the composition of the household in the tariff.