Water Rewards

Water Rewards:

A discussion paper for reducing urban water consumption

The success of Rewards programs such as frequent flyer and buyer schemes have laid down a blueprint that can be readily adapted to create a new, viable means of encouraging consumers to reduce water consumption. This discussion paper outlines a Water Rewards program that will influence water consumption, direct funds into sustainable water investment, and to use market mechanisms to manage the distribution of these funds.

Water Rewards overview

Reducing urban water consumption requires education and cooperation from the consumers. It also requires continuous capital funds investment to develop recycling and water saving systems, which on their own are not economically viable when competing with free rain.

Water Rewards is a voluntary scheme that reduces the need for water restrictions and increases water sustainability in urban areas through . It also ensures an ongoing source of funds for capital investment.

Water Rewards is a not for profit organization whose aim is to increase water sustainability. Water Rewards is a separate cooperative organisation outside but cooperating with Water Authorities and Governments. Not everyone has to join Water Rewards but those people who do join Water Rewards are given benefits.

Each member is notionally given a sustainable allocation of water for their household, based on the number of people attached to their water meter. The sustainable level of water per head is chosen by the Water Authority and is based on the region's water saving and consumption targets. If a household consumes less than its allocation, the participants receive Water Rewards. Water Rewards are electronic vouchers that can be spent on any approved water savings method such as a grey water recycling system, water efficient shower heads or water tanks etc..

If a household uses more water than its allocation it can consume as much as it likes providing it is willing to pay higher charges for excess water, which in turn pays for the Rewards.

The system does not mandate how water conservation is to be performed and makes no recommendations on the methods used. It simply offers economic incentives in an equitable and politically acceptable manner.

In addition to achieving the primary outcome of a reduction in water use, a Rewards program would provide funds for water-related infrastructure projects. The process offers incentives to assist consumer decision-making as well as appealing ethically and morally.

A self-funding program that could be offered in any community that has metering of water, its success or failure would easily be determined by measuring the decrease or otherwise in water use following the introduction of Rewards.

Spending the Rewards

Water Rewards earned may only be spent on approved water sustainability measures. These measures will be detailed in advance by the local water authority and could include community supplied based wetlands for outdoors irrigation of community facilities, home based recycling and grey water treatment, building of new storage facilities, recycling plants for the community, and any other similar project that will increase water sustainability.

Rewards may also be traded to someone else within the Water Rewards scheme. If a person has no use for the Rewards - perhaps they have already invested in water efficient technologies within their own home - the Rewards can be sold at a discount to another member of the scheme who may be better able to use them.

Rewards may also be donated and pooled into a community resource for investment in water efficiency projects. Such activities could range from installing water tanks or establishing grey water recycling at a local school through to local waterway restoration, dam construction, or water harvesting to ensure an adequate supply for local sporting ovals.

Rewards, not monetary currency

Using Rewards rather than a general currency - such as a cash back incentive or discounts - is important as the Rewards ensure ongoing investment in water efficiency. By restricting the use of Rewards to specific investments money cannot 'leak' to other activities. Unlike well-meaning taxes collected for specific purposes that often end up in consolidated revenue, Water Rewards encourage growth and ensures investment in a water efficiencies market. Water Rewards is a cost effective way of spending money on water infrastructure as it permits a granularity of expenditure ranging from individual households, local community based systems, communities of interest, system wide expenditures and with cooperating Water Authorities even across water catchments.

Water Rewards and the Water Authorities

Water Rewards will result in no net price increase because extra money over and above running costs will be in the control of the customers and will be spent on water sustainability. The Water Authority will distribute the money collected from members minus the cost of supply to Water Rewards

An important facet is that the extra money collected for water from Water Rewards participants is guaranteed to be spent on water efficiencies. Hence it cannot be seen as a de facto tax by the water authority or government. This means the Water Authority may be able to get approval for general water price increases for all members of community as anyone can join Water Rewards.

The setting of sustainable water usage levels and household allocations will help consumers to better understand their own water use. It should also help Water Authorities reduce the need for unpopular permanent water restrictions by increasing or decreasing pricing and Reward levels to motivate consumer behaviour and achieve the desired water savings.

Over time many participants of the scheme are likely to want to cash in their earned Rewards. This presents water authorities with an opportunity to purchase Rewards at a discount, in turn using them to help fund major water efficiency projects. In addition, Water Rewards introduces price signals to users and creates a mechanism for increasing the price of water to pay for major capital works. It will achieve this in a way that engages the community, allowing people to take an active step to join.

Simplicity for the consumer

Water Rewards will succeed in encouraging sustainable water use because they:

Reduce the need for urban water restrictions
Introduce price signals to consumers
Are simple, understandable and similar to other consumer rewards programs.
Are voluntary
Focus consumer behaviour on savings
Encourage water savings in times of plenty, not just when water is scarce
Bring guaranteed expenditure on water saving infrastructure
Bring communities together, not apart
Are cheap to introduce and inexpensive to administer
Are seen to be fair and prevent others profiteering from water shortages
Create a genuine market for water sustainability technologies
Can be introduced incrementally at a local, statewide or national basis

The Organisations behind Water Rewards

Water Rewards itself is a not for profit organisation. The organisations promoting Water Rewards will be the initial suppliers of services to Water Rewards. If they do not perform then they will be replaced with more efficient suppliers. The organisations are

Edentiti Pty Ltd - A company that provides IT services and importantly identity services that give control to the individual over their own online information.
EWater CRC - A Cooperative Research Centre based at the University of Canberra one of whose aims is to find ways for IT technologies to help make better use of water.
ECos Consulting - A research consultancy who advises organisations on the best ways to achieve sustainable industries. Ecos is part owner in the Rewards company Easy Being Green.