First, water in excess, in the form of flooding, can have a substantial negative impact upon life and property. Indeed, during flood events, water can destroy life instead of sustain life. The measure of such negative value of water may equate to the often difficult and arbitrary value of lost life and the replacement cost of lost property, including economic losses.
Second, absence of water, in the form of drought, obviously can have a substantial negative economic impact, ranging from loss of crops to displacement of people. The Dust Bowl in the United States in the 1930s illustrates this effect. Further, the negative values of crop, home and income losses can include collateral impacts due to health, social and educational challenges.
Third, certain contaminates carried in water can have serious adverse health consequences if such contaminates are not removed by treatment before water is used. The costs incurred to heal illnesses or to suffer destruction of crops contaminated by polluted water can be measures of negative value.
A fourth example of negative value of water may be illustrated when sources of water become depleted. A recent Yale led research study sought to measure the value of natural capital assets such as water. The study demonstrated pricing of natural capital by focusing on the Kansas High Plains groundwater aquifer, which supports the region's agriculture-based economy. The study found that groundwater extraction and changes in aquifer management policies reduced the state's total wealth held in groundwater by a total of $1.1 billion in the period 1996-2005. (See Yale News, March 14, 2016, "What's Nature Worth. Study Puts a Price on Ground Water and Other Natural Capital.")
Finally, public perception of tap water appears to imply a negative valuation regardless of compliance with all applicable regulatory standards. It appears that people in the United States are willing to pay significantly more for bottle water than for tap water. A 2013 American Water Works Association study found that tap water costs only $0.004 per gallon, or 1/300 of the average price of a 16.9 oz bottle of water. Another survey found that the public was willing to spend from 250 to 10,000 times more for bottled water, although USEPA estimates 40% of bottle water actually is more highly treated tap water.* Does the greater cost and use of bottle water indicate a negative value for tap water? Should it?
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*Bui,"No Sacred Cows:Getting To The Crux
Of The Matter," Journal AWWA,June 2016,
p. 12
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