Use of economic instruments in management of Rotorua geothermal field, New Zealand

Increased ¯uid draw-o€ from shallow geothermal aquifers by commercial and domestic users, between about 1950 and 1985, resulted in a progressive decline in natural thermal activity in Rotorua geothermal ®eld. In 1986, a controversial bore closure programme and charges for ¯uid use were implemented by central government to reverse the decline. In 1991, Environment Bay of Plenty (B.O.P.) (regional government) was allocated responsibility for management of the ®eld and further economic instruments were instituted, such as a reinjection credit scheme. In addition, a regional plan was formulated, which included no increase in total mass abstraction. These bold measures have been successful. Total geothermal ¯uid withdrawal was reduced from 29.0 (1985) to 9.5 kt/d (1988), and net withdrawal from 27.5 to 2.9 kt/d. Shallow water levels in the geothermal aquifer have risen by up to 2 m, and many natural geothermal features are recovering. However, the measures have had social costs: average family and elderly users have found it dicult to take advantage of the economic instruments, and there has been a shift from domestic to commercial use. 7 2000 Published by Elsevier Science Ltd on behalf of CNR.