School of Geography - Theses

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Type: Masters Coursework thesis × Subject: Economic aspects × Subject: Cost effectiveness ×

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    Identifying the real monetary cost of Eildon's water
    Hoatson, Grant ( 1999)
    In order to understand the real monetary cost of water supply from an impoundment like Eildon Dam there needs to be clear definition of the various costs and benefits associated with it's supply. Some costs, relate to downstream environmental impacts and are difficult to define whilst some benefits like recreational benefits are deemed "non marketable" and are not normally accounted for. This study attempted to explore the different costs and benefits associated with Eildon's water over various time periods, and analyse key cost benefit factors asset value and recreational costs and benefits. An attempt was made to investigate the real monetary cost of Eildon's water and also determine the feasibility of charges being set for recreational use. Review of the costs of Eildon's water revealed that prior to 1994 only maintenance and operational costs had been covered by water tariffs and currently full environmental and recreational costs were not being charged. The real monetary cost of Eildon's water was found to be $3.12/ML and the value of recreation was found via the Travel Cost method to be worth $8.73million / annum although it is important to recognise that their are many non marketable recreational benefits like social and community benefits that make the lake far more valuable than just this. The study concluded that recreational users should pay for their use of Lake Eildon based on the user pays system, with charges weighted towards high impact users like water skiers. It was felt that a charge of $10 per day was affordable by water skiers and would not restrict this activity.