Agricultural Water Demand Management in Northern China and Alberta
1. Agricultural Water Demand Management in Northern
China and Alberta
Joey Yi Zuo (PhD Student), Dr. James Rude (Associate Professor), Dr. Vic Adamowicz (Associate Dean & Professor)
and Dr. Chokri Dridi (Assistant Professor)
Department of Rural Economy, University of Alberta
Objectives: What is “Water Demand
This research examines and compares the agricultural water
demand management mechanisms used in Northern China and Management”?
Alberta. •Practices that will achieve: (1)reduction of the demand for
irrigation water, (2)water conservation and savings in irrigation,
and (3)increases in yields and farm income per unit of water used.
China’s Water Pricing System:
•Water fees are charged mostly based on the size of irrigated area
not the actual volume of water used. Alberta’s Tradable Water
•The agricultural water price is very low. For example, in Hubei
province, the agricultural water price is extremely low with an Entitlements (TWE):
equivalence of 0.04 yuan per cubic meter, compared to domestic and •Alberta’s Water Act allows transfers of a water license which
industrial prices of 0.08 and 0.12 yuan per cubic meter (Lohmar et. al, includes the following elements: (1)annual delivery volume of
ESA Working Paper, 2003).
water; (2)maximum diversion rate, (3)water source (i.e.
Northern China’s Hai River Basin: underground or surface) and location site, (4)priority of water
•One of the 7 largest river basins in China right ,(5)purpose and timing.
• 10% of China’s population •The licenses are allocated on the “first-in-time, first-in-right”
• Cultural and economical center of China principle, so it protects an existing user’s rights from those who
•Urbanization is directly affecting the water balance come after them and allows for orderly development (Alberta’s
• Groundwater depletion is the most serious in the Hai River Water Act).
basin (World Bank 2001, “China: Agenda for Water Sector •Since 2003, 28 licenses have been transferred. Among those, 17
Strategy for North China”) did not involve any monetary compensation in exchange for water
Attributes Similar to Alberta: entitlements.
•Large farms, cold weather, and fertile agricultural lands Potential Results:
•Major crops: wheat and barley • The transfer mechanism limits the use of a spot market for
Table 1: Average Village Level Farm Income and trading.
Irrigation Water Pricing in 2004 in China’s RMB yuan (1 •It allows water allocations to move to the new demand without
yuan=0.18 CDN dollar) injuring the environment or interfering with existing users.
Further Research and Policy
Implications:
Government agencies and researchers should:
•Use taxation as a centralized option and water markets as a
Source: China Water Institution and Management Survey complementary one.
Table 2: Farmer’s Attitude Towards Water-saving Further research:
•Find out what the value of water is through optimization
•Find out what influences the prices paid in the transfer market
Conclusion:
Potential Results: By examining the agricultural water management mechanisms
The current pricing policy in China will not be an effective tool used in Northern China and Alberta, we conclude that TWE is a
in reducing demand or providing incentives for agricultural water better management mechanism to alleviate the influence of
users to save water. raising water prices and to facilitate the reallocation of water
resource to more efficient users.
Acknowledgements:
Dr. JingXia Wang at the Chinese Academy of Science, Dr. Contact Information:
Qiuqiong Huang at the University of Minnesota, and Dave Joey Yi Zuo
McGee at Alberta’s Department of Environment are gratefully yijoey@ualberta.ca
acknowledged for their provision of data and comments.
