Economic Instruments in relation to Groundwater Use

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Contamination and over exploitation of groundwater resources have led to degradation and depletion of water resources in many places throughout the world. Protection of ground water resources therefore is an issue of major importance. Economic instruments (such as taxes, extraction fees, or tradable permits) are one means to tackle this issue. For Germany in particular, the German Council of Environmental Advisors (Sachverständigenrat für Umweltfragen) proposed the application of tradable groundwater extraction permits already in 1998.

Based on a range of previous work, adelphi, in a short study, summarised international experiences with the use of tradable groundwater permits and evaluated the applicability of this instrument to Germany. On the basis of the results, adelphi prepared a positioning paper for LAWA with regard to the international context of the discussion.