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Is a market based solution suitable to save the River Kennet, in Marlborough, Wiltshire, UK?

The River Kennet is one of England's most important chalk streams. Some 45 miles long, it is the largest tributary of the Thames and in summer months contributes up to half its flow.
On Friday September 30th, the minister for the Natural Environment and Fisheries, Richard Benyon met Geoffrey Findlay and Charlotte Hitchmough from Action for the River Kenent in Marlborough to discuss the low flows in the river Kennet, and the on-going issue of over-abstraction. Local MP Claire Perry also attended the meeting and made clear to the minister that her in-box was full of letters expressing dismay at the poor state of the upper Kennet. Claire offered such help as she could give to support ARK in its campaign to reduce water abstraction.

As he stood on the bridge overlooking a dried out section of the river, Richard Benyon agreed that the state of the Kennet was 'very worrying'.

  • Jan 25 2012: I believe that water is overrated and there will be an severe economic affect in Swindon if we don't continue to pump water out of the Kennett as the price of water will dramatically rise
  • Jan 25 2012: "Thames Water has made a commitment to reduce abstraction from the Kennet aquifer" This commitment is useless unless some monetary incentives are enforced/given to reduce.
  • Jan 25 2012: Maybe some kind of market mechanism involving tradable permits, such as that used in carbon emissions schemes could be effective? Until an incentive scheme exists, companies won't take action. Regulation is not an approach that will return long term benefits, as there is no incentive to search for a greener, cleaner approach that will REPLENISH the river. Internalising the externality is only half the battle, the authorities should be a little more creative and seek a solution that incentivises both households and companies to not only reduce consumption, but replenish sources. It's not enough to put a brick in the cistern!
  • Jan 25 2012: I think the whole school should do a rain dance in court
  • Jan 25 2012: I blame Swindon
  • Jan 25 2012: I blame the EU
  • Jan 25 2012: Biers, are you there? Do you know what the tragedy of the commons is?
  • Jan 25 2012: I blame the Labour Party.
  • Jan 25 2012: i think that instead of having that second glass of water in norwood we should pour it into theriver then it will be flowing with drinking water which we can drink as well after games in the summer?!?!?!?
    • Jan 25 2012: Certainly we should be looking for strategies that incentivise to replenish, but do yo
      u think that this is sustainable?
      • Jan 25 2012: yes, norwood has a lot of water. it will keep the river kennet flowing for approx. 26 years which gives us time to think of a plan
  • Jan 25 2012: Is this a classic case of the Tragedy of the Commons?
    • Jan 25 2012: I don't know what Tragedy of the Commons is?
  • Jan 25 2012: i agree with biers
  • Jan 25 2012: Walking over the River Kennet on a daily basis has opened my eyes to the damage and destruction Thames water is causing to our local community. Not only are they decreasing the aesthetics of this outstandingly beautiful rural part of the shire but more to the point they are ruining and bringing to an end numerous young and unfulfilled lives (of the fish). Now, I wouldn't consider myself an economist but you people seem to know what you're talking about and Im not sure what the solution is but what you're suggesting seems to be along the right lines. Based on my limited knowledge I think that the market based solution will internalise the negative externality being created here, but what do I now?! Go get 'em guys! SAVE THE RIVER KENNET!! Xx
    • Jan 25 2012: Being in the same situation, i completely agree with what you have said. SAVE THE RIVER KENNET!!
  • Jan 25 2012: Internalising the externality is only half the battle, the authorities should be a little more creative and seek a solution that incentivises both households and companies to not only reduce consumption, but replenish sources. It's not enough to put a brick in the cistern!
  • Jan 25 2012: maybe give firms the incentive of reducing their water footprint?
  • Jan 25 2012: It is not only the river that needs to be sorted. Should firms be stopped from extracting water, there needs to be another solution so their water needs can be met in a sustainable manner.
  • Jan 25 2012: People taking water from the river kennet may be suffering from Myopia.
  • Jan 25 2012: An incentive to conserve water rather than abstract it needs to be established. Perhaps water permits??
    However, seeing that the River Kennet is primarily short of water due to a lack of rainfall. There is no market solution to increase the amount of rain so its suitability is questionable.
  • Jan 25 2012: Make the people in Swindon who are taking the water have the opportunity to get paid for putting it back.
  • Jan 25 2012: Maybe some kind of market mechanism involving tradable permits, such as that used in carbon emissions schemes could be effective? Until an incentive scheme exists, companies won't take action. Regulation is not an approach that will return long term benefits, as there is no incentive to search for a greener, cleaner approach that will REPLENISH the river.
  • Jan 25 2012: social costs are greater than private costs and a water tax MUST be implemented with immediate effect!
  • Jan 25 2012: Incentives must be created to stop companies from withdrawing water from the stream. For example, rewards for not taking water from the stream. These methods would be effective in both the short and long run but are not very cost effective.
  • Jan 25 2012: Placing a tax on the extraction of water would help move the MPC closer to the MSC, and would hopefully reduce the amount of water been extracted.
  • Jan 25 2012: But where is the incentive going to come from?
  • Jan 25 2012: or do we limit the amount of water they can extract?
  • Jan 25 2012: Yes. Thames water need an incentive.
  • Jan 25 2012: What a disgrace! All down to Thames water!