In southern California, the Metropolitan Water District is cranking up the rate meter, squeezed in the conservation v. cost vice:
As more people conserve water, MWD sells less water, and that means revenues go down. But MWD’s costs of delivering that water remain essentially the same: Thus, prices go up.
Yes, but cart-before-horse retarded, as usual.
Instead of setting P’=TC/Q, MET could set Q, then let member agencies bid for water, establishing P*. Given scarcity, P*>P’, so costs covered.
Voila!
Relevant here:
“Joel Kotkin: The Great California Exodus,” WSJ 4/20/12
http://online.wsj.com/article/SB10001424052702304444604577340531861056966.html
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