ABSTRACT:Calgary, the fastest growing city in Canada, is about to expand its urban water supply facilities in order to meet peak summer demands. Most of Calgary's residential water is sold by flat rate. The effect of this pricing policy on peak and average demands is discussed. The true marginal cost of peak capacity from the new expansion is calculated. The effect of a proposed metering program on capacity expansion requirements is computed. It is concluded that metering should preceed the next capacity expansion.
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