Water Bills – Are they Clear to Residential Users?

Abstract

The aim of this paper is to assess the clarity of water bills based on the views of residential users gathered by means of a questionnaire survey administered to a sample of 386 households in the Portuguese autonomous region of Madeira. The main rational behind this study lies on the argument that the opacity of water bills suggested by the characteristics of existent water tariffs schemes might be jeopardising the effectiveness of price signalisation. Findings indicate that the vast majority of users has a very incomplete perception of the items that bills comprise and even fewer are aware of how much water they are consuming and how much they are paying. Evidence shows that more knowledgeable consumers tend to be more conscientious of the importance of adopting environmental friendly behaviours. Overall, the study supports the view that simplifying water bills is an important area calling for the intervention of regulators.