Economic instruments and irrigation water management in France

In spite of abundant reserves in France, imbalances between water needs and resources, conflicts between different categories of users are likely to appear during low river flow periods. In these situations, as water becomes a scarce resource, it can not be considered any longer as a free good but as an economic good. In a context of a limited water resource, community tries to induce, farmers to minimise their water consumption by developing and implementing economic instruments such as water markets, rationing procedures (quota) or appropriate water pricing. However, market mechanisms can not function efficiently without an appropriate legislative framework. In France, the laws of 1964 and 1962 and the European regulation define the principles of water management. The water law of 1992 insists on the uniqueness of water resource, imposes measuring devices and defines negotiation areas. The implementation of this law renew the interest for incentive economic instruments, the conditions required for their implementation and their limitations. In France, water pricing and quota are implemented. These instruments are not incompatible and are likely to complement each other. One manager (Compagnie du Bas-Rh?ne-Languedoc) particularly takes into account water demand, another (Compagnie d'Am?nagement des Coteaux de Gascogne) applies a system combining quota and water pricing, the last (Soci?t? du Canal de Provence) uses marginal cost pricing.