Economic evaluation of regional water supply policy in Zhangye, China

摘要

Zhangye,north China,is facing serious water shortages because of the increase in the local population and development of irrigated agriculture.The main sources of water are the Hei River and groundwater,both of which are in short supply.The shortage has prompted the local government to implement water saving policies,which are influencing not only the quantity of water used but also Zhangye's economy as a whole.This research thus analyzes the economic impacts of the current water saving policies by using SAM(Social Accounting Matrix)and CGE(Computable General Equilibrium)models.In the first scenario,we assessed the impact of doubling the surface water price and found that the amount of surface water decreases by 7％of the total surface water input,while the amount of groundwater increases by 84％of the total groundwater input.This clearly is an inefficient scenario,because the loss of EV per yuan of surface water savings is 14.58 yuan.In scenario 2,we analyzed the impact of two groundwater pricing plans and found that in order to control the groundwater input,the groundwater price should be relatively low in primary industries and higher in other industries.