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• Incentives to conserve can have perversely increased usage as demonstrated by
the rebound effect.
• Projects may affect non-market items like water quality which may, if valued,
influence an appraisal.
• Transferring evaluation estimates from elsewhere have both advantages and
drawbacks.
• Water has a different value in different uses. This requires both quantification
and consideration when making decisions. The consideration of water movement
costs and water allocation patterns between users is a crucial consideration.
Techniques exist for estimating the value of water in alternative uses so one can
look at the implications of Nexus–based reallocations or new water development
activities.
• When identifying strategies based on those currently employed, one must realize this is biased by historical prices and that other strategies could be used if
prices change.
• Economics provides welfare metrics that can be utilized when examining making decisions about Nexus possibilities in a benefit–cost analysis. The welfare
Fig. 5.3 Edwards aquifer and river system simulation model (EDSIMR) framework
5 Economics