There is no water shortage...

...in the marketplace. Go to any supermarket, and you can buy all sorts of water: sparkling, spring, flavored, boxed, bottled, canned, whatever you please.

It's only when a good is regulated by government do we see shortages. This is best summed up by Say's Law: markets tend to clear. Supply tends to equal demand, and the resulting price is the market price. When government imposes a price ceiling on a good, there will be more demand that supply. Only governments create shortages.

If Exeter's water supply was owned and operated by private companies, prices would move freely as supply and demand fluctuate. When there is a drought (supply decreases), the market price will increase as demand falls (along the demand curve, all else equal). This is the natural and peaceful way to conserve water. Further, high market prices will encourage production of the very good that has limited supply. Entrepreneurs competing for profits actually increase supply and eventually lower the price.

Instead, we have a problem caused by intervention: government ownership of water creating a shortage. Instead of ending the government ownership, another intervention is applied: political rationing. So, instead of consumer demand and conserving water, we have the Town Rulers determining what we can use and when.

They are so wise.