Agricultural Irrigation Pricing: Review of Theories and Practices

Water pricing and substitution of the costs of irrigation investment operation and maintenance have been controversial issues for a long time. The small charges for irrigation water are addressed, and additionally, the low level of farmers who pay the costs. In a few schemes, expense accumulation rates are close to zero, notwithstanding when water charges are well beneath the cost of operation and maintenance. Water prices are charged to farmers for two essential objectives. The first is to cover the operation and maintenance estimation with the goal that the investment is fiscally practical. Much of the time, costs will likewise need to incorporate a price for the cost of capital required to develop the scheme. This charge for capital is fundamental for future irrigation system investment. The second reason involves estimation to help farmers utilize less water per unit of yield or to deliver more prominent net economic returns per unit of water, or both. This paper summarizes irrigation water pricing methodologies and the related academic literature. Three water pricing methods are presented: volumetric, non-volumetric and water market. For each methodology, potential impacts on water usage are postulated and supported by a summary of the academic literature. In addition, a summarized case study of irrigation water-pricing practices and effects in Iraq is presented. (c) 2018 John Wiley & Sons, Ltd.