The first step in questions such as this one is to identify the main conclusion of the argument. It is common that there are multiple conclusions in boldface questions. Here are some tips to find the main conclusion.

First, look for modal verbs. Verbs such as must, should, will, etc., often accompany a conclusion.

Second, think about the author's intention. What is it that the author wants you to think after reading his argument?

Finally, the why? test. If you have identified the conclusion, you should be able to ask the question why? and use the rest of the argument to answer.

In this case, the author wants us to believe that the price of tap water in our region should be raised drastically. Why? Because supplies in local freshwater reservoirs have been declining for years and because few users have bothered to adopt even easy conservation measures.

The value of the why? test extends not only to finding the conclusion but also to identifying the premises. Since both of the boldface portions answer the question why, both are premises.

What's wrong with (E)? It erroneously claims that the first boldfaced claim is the main conclusion. Yet the first boldfaced part supports another part of the argument. Accordingly, it cannot be the main conclusion.