There's a great article in last week's New Yorker called 'City of Water', by David Grann (unfortunately not online). The article details the long, arduous struggle to build a third water tunnel in NYC, so that the city won't be completely without water should Tunnel #1, which is over 70 years old, or Tunnel #2, which isn't that much younger, develop cracks or other problems rendering one or both unusable.
Tunnel #3 has been under construction since the 1960's, and some think it won't be completed until 2020 at the earliest. The reasons for the delay appear to be a combination of government incompetence, corruption, and NUMBY-ism (not *under* my back yard). These are all typical sources of delay with government projects, nothing unusual there. But one difference, at least as presented in the article, is that the threat of NYC losing its water supply before Tunnel #3 is complete is very real, and the damage would be unimaginably huge.
As great engineering marvels as the first two tunnels may be, past readers won't be surprised to learn that I'm no fan of huge, centralized, single-point-of-failure systems. In this case, not only is the system centralized, but given the risk, it seems to be underpriced. The city should be prepared to function at a minimum with only one tunnel, and the easiest way to do that would be to lower demand through that time-fashioned method of raising the price.
The other advantage of raising the price of water is that it would provide incentives for entrepreneurs to develop a more decentralized water infrastructure. It's possible to re-use water within the home/office/industrial complex, but at current prices it's generally cost-prohibitive. If NYC notified all water consumers that prices would be rising over the coming years at a rate of, say, 10-20% per year, we might start to see some innovation in the sector.
Posted by Stephen Bronstein at September 4, 2003 05:34 PM