Paying for Water in Ontario’s Cities

Concerns over the capacity of some municipalities or local utilities to adopt efficient pricing and be sustainable bring out the need to reconsider the way in which smaller and remote municipalities provide water and wastewater. [...] Much has happened in the water and wastewater field since then, most notably the events surrounding and responding to the Walkerton tragedy in 2000.1 In May 2000, the municipal water system in Walkerton was tainted with the dangerous O157:h7 strain of E. coli bacteria, affecting more than 2,500 water consumers, of whom five died and many others endured long-term health effects. [...] The plan describes the characteristics and condition of the infrastructure, the levels of service expected from it, planned actions to ensure that assets are providing the expected level of service, and financing strategies to implement the planned actions. [...] They suggest that the definition of annual operating and capital costs is too narrow, because it ignores the opportunity cost of water withdrawn from the natural environment, including the commercial exploitation of aquifers such as is being witnessed in the controversy with Nestle’s bottled- water plant in Aberfoyle, Ontario, and its potential impact on regional wells; the opportunity cost of lan [...] The economic rationale for a peak-demand system is that in order to meet this demand, the municipality must maintain supply facilities that are larger than they need to be to meet demand for most of the year or most of the day.