Capital Base

The demand-management strategies that were implemented in Athens as part of the first Emergency Act included a public-awareness campaign, the ban on watering gardens, washing cars and filling swimming pools and, most importantly, the decision (on 8 May 1990) to enforce a retroactive increase in water prices, which was to take effect from 1 March 1990. The price per cubic meter paid by domestic consumers increased by between 105 percent and 338 percent and water bills increased by between 40 percent and 140 percent. This increase was brought about through a complex system of rates related to water consumption levels (see Kaika 2003a; Kallis and Coccossis 2003). According to statistical data provided by EYAAn, an average Athenian household of four members consumes 15.6 m of water per month. Under the old rates, this household would have to pay 885 dr. (€2.59) per month for their water bill, but under the new rates the same bill would amount to 2,187 dr. (€6.41) However, if the same family succeeded in saving 20 percent over its previous month's consumption, they would pay a "reduced" bill of 1,733 dr. (€5.08) per month instead (still higher than the original 885 dr.). The catch to this complex pricing system was that higher-volume consumers were offered a greater price reduction for water savings than lower-volume consumers. For example, a 30 percent saving in water consumption of, say, 15m3 per month achieved by lower-volume consumers would save them around 132 dr. (€0.38) per m3. However, the same percentage in saving—of say, 120 m3 per month—achieved by a higher-volume consumer would save them 675 dr. (€1.98) per m3.

The alchemy of the new water-pricing system and water-saving incentives was highly contested by the public and by a number of organizations, including the public water company itself, which had suggested only an 18 percent rise in water rates. The committee of the employees of EYAAn characterized the pricing policy implemented as "inefficient, socially unjust, profiteering and perplexing" (Newspaper EBvog 10 February 1993). Nevertheless, the complex pricing system did result in an average 20 percent decrease in water demand. Notably, however, the public response to the water-saving campaign and price incentives had a clear social stratification (KEnE 1996). Despite the fact that the new pricing system was designed to give greatest financial incentives to heavy users, it was, in the end, the lower-volume consumers (corresponding to lower-income households and poorer urban areas) who achieved the greatest savings and reduced their consumption by up to 30 percent. Heavier users (corresponding to higher-income areas and houses with gardens and swimming pools) saved very little or nothing at all (Proceedings O& Assembly of the Greek Parliament, 16 February 1993). Thus, after the increase in water prices, the 3 percent highest-volume consumers ended up using 40 percent of the total water supplied (I.Tsaklidis, MP, Proceedings, O& Assembly of the Greek Parliament, 16 February 1993:4,105; Newspaper To B/pa August 1990). These figures indicate a clear "class" stratification, not only in water consumption, but also in sensitivity expressed as public response to a call for environmental protection and demand-management.

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