Payment for Water Use in Brazil: a Methodology Review

Abstract

The purpose of using economic tools in water management is to encourage reasonable water consumption patterns. In this context, the National Water Resources Policy, in order to put an economic price to water, introduced the water pricing in national Watersheds. This methodology review presents the methods for putting a price on water currently used in waters under federal jurisdiction, the generated revenues and investments in the respective watersheds. In Brazil, this tool is currently used in the following watersheds: Paraíba do Sul, Piracicaba, Capivari and Judiaí Rivers, São Francisco River and Rio Doce. Also in the state of Ceará, a pioneer in the country, a price is paid for water use, but in a conceptually different way. In all watersheds with waters under federal jurisdiction, the pricing model follows the same structure, encompassing all types of water use, particularly catchment, consumption and effluent discharge. Thus, each take into account the volumes used, the unitary price for the use and the own and relative management coefficients of the watershed. The price of raw water use in Ceará is calculated according to the current fare system and only defined according to the values of water consumed. The sector collection proved to be variable; however, one may say that basic sanitation and industrial sectors show greatest revenue collection potential. Thus, we found that revenues collected were mostly invested in structural actions involving the recovery of water resources, such as water treatment plants, sewage collection and waste removal.