Water use restrictions or wastewater recycling? A Canadian willingness to pay study for reclaimed wastewater

Canada is the envy of many countries due to its abundant water resources: 7% of renewable fresh water with 1% of the world's population. However, pressure on this resource is growing; it is exacerbated by predictions of increasing water shortages and reduced reliability of traditional water supplies due to climate change. Canada has begun to examine the potential for the use of reclaimed wastewater to augment water supplies. The literature on reclaimed wastewater reveals a general reluctance to accept its use but that there are some situations in which consumers perceive benefits and are willing to pay for them. This paper investigates one such situation: namely, whether people are willing to pay in order to avoid summer water use restrictions via water supplies augmented with reclaimed wastewater that can be used for toilet flushing. The paper presents the first effort to examine the degree of public acceptance in Canada of supplementing existing water supplies with reclaimed wastewater. Using results from a double bounded contingent valuation survey undertaken in 2009, the paper finds an average annual WTP per household that ranges between $142 and $155, depending upon the scale of the project and upon whether respondents are concerned that other members of their community will not comply with summer water use restrictions, thereby, free riding on others. These values fall within the range of previous estimates in the literature and are somewhat higher than values obtained from Australia where there has been more adaptation to low water supply circumstances.