1. Prof. Krzysztof Berbeka National Water Management Authority Poland
Assessing Resource Costs - the methodological challenges (case of Poland)
Prof. Krzysztof Berbeka
National Water Management Authority
Poland

2. Basic assumptions
Opportunity cost is equal to the benefits derived from the best alternative use of the good (resource),
Identification of quantitative deficit of water resources in a given „calculation unit” (m3/y). 2

3. Understanding the „deficit” according to: hydrology vs economy
(H) deficit - the consumption of water below the water resources renewal rate or the surface water intake below the long term (natural) flow series ↔ (E) situation when outgoings exceed income (ex-post approach) 3

4. Unit resource cost indicator (water intensity) [€/m3] =
Enough ?
fish ponds…
agriculture…
industrial sectors…
Marginal water productivity function
(relation between the amount of
water used, purchase price and the
size of production) should be
determined on the basis of empirical
data. 4

5. Current resource costs in Poland → 0 but this is partially the result of missing procedures for data gathering
1. All needs related to the use of water as a resource are currently met; this takes place at the cost of the quality of surface waters (bringing down the flow below the instream flow level), or at the cost of future generations (permanent reduction of the groundwater resources); proper procedures of data gathering (concerning hypothetical water deficits in industry sector) are lacking in Poland
2. Disadvantages related to the lowering of flows below the instream flow level have been estimated and incorporated in the environmental costs; 5

6. Current resource costs in Poland → 0, cont.
3. Disadvantages of future generations are currently equal to 0 (which is not a correct state and partly due to the lack of theoretical solutions);
4. Alternative uses of water for other purposes (e.g. for recreation) have been incorporated in the estimation of the environmental costs
5. Meeting all the current needs leads to the lack of opportunity costs related to the use of water treated as a resource; 6

7. Review of methodological gaps
GAV = value of foregone alternative action??
assessing the real demand for water,
the value of marginal productivity of water for different sectors,
value of water for the next generations… 7

8. Questions, suggestions are welcome…
Krzysztof Berbeka