Despite many regions having high levels of rainfall, readying water for consumption comes at a high economic and environmental cost.
Citizens in a number of European countries pay a flat fee for water regardless of the amount used, or even no fee at all.
In the study, 'Assessment of cost recovery through water pricing', the EEA looked at water pricing in England and Wales, France, Germany, the Netherlands, Scotland, Croatia, Serbia, Slovenia and Spain.
“In many parts of Europe, profligate water use is a real problem,” said Hans Bruyninckx, the EEA's executive director.
The research group found that citizens wasted around a third more water when they were not charged for the actual amount they used.
Bruyninckx added: “there is a lot of potential for Europe to cut water use by improving efficiency. Charging water users for the volume of water they actually use, at a price reflecting the true cost, sends an important signal – freshwater is a limited and precious resource.”
The report found that flat-rates did not significantly change water drinking habits but that uses such as for gardening or swimming pools did.
Denmark serves as example for water reduction policies. Between 1993 and 2004 the country increased its urban water prices by 54% and invested significantly in infrastructure. Over a decade, daily water use per person fell by almost 20% to 125 litres, one of the lowest levels of any rich country.
The EEA also called for governments to include the full cost of water, including environmental impacts.
A statement accompanying the report says that water should be “priced at a level which both encourages efficient use and properly reflects its cost”, adding: “This should include all costs of purifying and transporting the water. In addition, environmental and resource costs of water use, such as pollution and the depletion of resources, should also be internalised into water prices”.
On 30 September, the United Nations marked the anniversary of an international decision to make water a legal right. In this context, an EU body using the day to call for greater water pricing is oddly timed, especially as poor families struggle to make ends meet in the financial crisis.
The EEA said: “Low-income households must also have access to affordable water services, but keeping prices artificially low for all users is not the best method." The report says that this may create a vicious cycle of underfunded service-providers with poor infrastructure.
According to a 2012 Eurobarometer survey, 84% of the public agrees somewhat with water being charged at its full price.