Climate Change and the Willingness to Pay to Reduce Ecological and Health Risks from Wastewater Flooding in Urban Centers and the Environment

Abstract

Climate change scenarios predict an increase of extreme rain events, which will increase the risk of wastewater flooding and of missing legal water quality targets. This study elicits the willingness to pay to reduce ecological and health risks from combined sewer overflows (CSOs) in rivers and lakes, and wastewater flooding of residential and commercial zones under the uncertainty of climate change. We implement a discrete choice experiment on a large representative sample of the Swiss population. We find that about 71% of the respondents are willing to pay a higher annual local tax to reduce the risk of CSOs in rivers and lakes. Swiss households strongly value the protection of water bodies, and mostly, the avoidance of high ecological risks and health risks for children related to CSOs in rivers and lakes. Our findings also show that climate change perception has a significant effect on the willingness to pay to reduce these risks. These results are important to support policy makers' decisions on how to deal with emerging risks of climate change in the water sector and where to set priorities.

Keywords: choice experiment, climate change, combined sewer overflow, ecological risk, health risk, wastewater

JEL Classification: D61, D81, I10, Q25, Q51, Q54, Q57