I don’t think this is exactly what David Zetland has in mind when he argues for establishing water markets, but hey, whatever works! From the International Herald Tribune:
In the world’s driest inhabited continent, there is simply not enough water to go around, and households, cities, industries and agriculture all demand their share from stressed reservoirs and rivers. So Australia’s irrigation planting sector relies on a unique trading system to make the most of every drop.
What began as a localized trade within states is now an active national market that shares water along hundreds of miles (kilometers) of river systems used by thousands of farmers. And with the drought, the trading of water is picking up pace.
Nope — this is EXACTLY what I am thinking about. The Aussies will be teaching us a thing or two. (My idea “raise prices” applies to urban water supplies. Markets/auctions are appropriate at the wholesale/inter-sector level.)