January 25, 2003

2003: Highlight # 3

Just as in India, groundwater is central to Mexican agriculture. Scott and others explore options for using energy pricing for groundwater demand management in Mexico...

Energy Pricing and Supply for Groundwater Demand Management

Lessons from Mexican Agriculture

Christopher A. Scott, Tushaar Shah and Stephanie J. Buechler

Mexico’s agriculture is highly groundwater intensive, more than even India and China. Moreover, municipal and industrial demands are also met largely by groundwater. This places aquifer overdraft firmly at the centre of both present and future water management challenges in the country.

Strong legislation and radical institutional innovations have been tried to regulate groundwater use. While the purely regulatory approach has failed in controlling groundwater over-exploitation, institutional approaches are still evolving.

Power pricing and supply policy can be used to structure economic incentives to complement the regulatory and participatory approaches to groundwater conservation.

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