China’s Water Pricing Policies

In order to address the water contamination and supply problems in China, a number of water pricing policies have been introduced. They include water resource fees, water supply charges, wastewater treatment fees, and water pollution levies. The purposes of China’s water pricing policies are to protect and conserve water resources, encourage reasonable utilization of water resources, control pollution, and protect the environment. However, concern about the affordability of China’s water pricing for users has resulted in generally low tariffs. Moreover, as a result of poor supervision, China’s actual revenues from water pricing are far less than receivables. Consequently, wastewater discharges still produce pollution, while the polluters achieve environmental dividends by bearing relatively low pollution control costs. China’s water pricing policies should be improved through application of the polluter-pays principle and full-cost pricing. It is also necessary to strengthen environmental laws by specifying environmental standards on the basis of environmental non-degradation.