The Theory of Water and Utility Pricing - Global Drinking Water Management and Conservation - page 93

Table 5.5 (continued)
Q Ramsey

price
brackish

Ramsey
price
seawater

Breakeven
price
brackish

Breakeven
price
seawater

30 10.6 (40124) 0.3117 1.3204 0.4208 1.4936

31 14 (52994) 0.29 1.2785 0.3916 1.4462

32 25 (94633) 0.2495 1.1954 0.3369 1.3522

33 25 (94633) 0.2495 1.1954 0.3369 1.3522

34 25 (94633) 0.2495 1.1954 0.3369 1.3522

35 64.5 (244152) 0.1951 1.071 0.2635 1.2114

36 70 (264971) 0.191 1.0609 0.2579 1.2

The Breakeven Prices equal ATC. TC function was shown to be:

T C ¼ e a Q ðbþd SEA Þ e c SEA

For a brackish water desalinating plant, Breakeven Prices are derived as follows:

f SEA ¼ 0 g

T C ¼ e a Q b

)

ATC ¼ e a Q b 1

)

Using the coef cient estimates obtained in the adjusted log-linear regression

model, we get:

ATC ¼ e 7 : 985754878 Q ð 0 : 740621837 1 Þ

ATC ¼ e 7 : 985754878 Q 0 : 259378163

For a seawater desalinating plant, the Breakeven Price is higher:

f SEA ¼ 1 g

T C ¼ e a Q bþ ðÞ e c

)

TC ¼ e aþc Q bþd

ATC ¼ e aþc Q bþd 1

)

Using the coef cient estimates obtained:

ATC ¼ e ð 7 : 985754878 þ 0 : 928025419 Q ð 0 : 740621837 þ 0 : 143438118 1 Þ

ATC ¼ e 8 : 913780297

Q 0 : 115940045