There are several general principles involved in assessing the economic value of water and the costs associated with its provision. First, an understanding of the costs involved with the provision of water, both direct and indirect, is key. Second, from the use of water, one can derive a value, which can be affected by the reliability of supply, and by the quality of water. These costs and values may be determined either individually or by analysis of the whole system. Regardless of the method of estimation, the ideal for the sustainable use of water requires that the values and the costs should balance each other; full cost must equal the sustainable value in use.
Source: P. Rogers, R. Bhatia, A. Huber - Water as a Social and Economic Good: How to Put the Principle into Practice (1998)
