AN ECONOMIC ANALYSIS OF WATER CONSERVATION POLICY1

Water conservation is a much emphasized policy of the Federal government. Discussion of water conservation proposals often involves confusion between a conservation “ethic,” which is an end in itself, and conservation as a means for attaining various economic objectives. Analysis indicates that outside of ground water “mining.” water is usually a renewable and reusable resource. During periods of normal precipitation, water conservation should be employed only when the value of the water saved exceeds the cost of effecting the savings. Water conservation is most valuable as a drought contingency tactic. Water conservation as a substitute for structural provision to meet normal water demand growth is apt to prove shortsighted.     

RURAL RESIDENTIAL WATER DEMAND: AN ECONOMETRIC AND SIMULATION ANALYSIS1

ABSTRACT: This study proposes that demand management through pricing policies can be used in conjunction with supply management to solve water supply problems. Economic principles are shown to apply to rural residential water use. A demand function for water was developed based on cross-sectional water use data collected in Kentucky. Price was found to be a significant determinant of the quantity of water demanded. A constant price elasticity of -0.92 was found. The demand function was used in a simulation analysis to determine reservoir capacity needed to supply water needs of a rural community. The simulation revealed that price can significantly affect required reservoir storage.     

OPTIMAL CAPITAL INVESTMENT IN THE EXPANSION OF AN EXISTING WATER RESOURCES SYSTEMS1

The study of the optimal expansion of existing water resources systems is of continuing importance because of the rising demand and limited supply of water in many areas of the world, particularly in the southwestern part of the United States of America. This study is concerned with the investigation of the optimal expansion of a realistic water resources system to meet an increasing demand for municipal and industrial use, irrigation, energy, and recreation over a planning horizon of T years. A number of possible dam sites are available for the further regulation of river (canal) flows in the basin and/or the regulation of imported waters into the basin. To maximize, over the set of alternative projects, the sum of discounted present value of net earnings subject to the demands and various institutional, physical and budgetary limits, an optimization problem (Problem I) was formed as a 0-1 mixed integer programming problem and was decomposed into the set of all feasible combinations (Problem II). The economic return was determined for each combination (Problem III). Problem II was solved by a branch and bound procedure which selected each feasible combination of dams while the optimal return for each such combination (Problem III) was found by a network analysis code.     

A REVIEW OF APPLICATION ISSUES OF THE METROPOLITAN WATER DISTRICT-MAIN WATER FORECASTING SYSTEM1

ABSTRACT: This paper reviews the processes that occurred during an application of the Metropolitan Water District (MWD)-MAIN water use forecasting system for the City of Salinas, California. The review includes an analysis of sources of available data, methods for estimating input data, calibration, and verification of the MWD-MAIN System, and an evaluation of the reliability of system output. We found that inexperienced users can have difficulty understanding the level of skill, knowledge, and amount of data that are required to produce reliable forecasts. Some of the issues associated with application of the MWD-MAIN System include the following:

• ? All input data needed for accurate forecasts simply are not available for many cities and towns.
• ? The data requirements are more extensive than many users anticipate.
• ? Substantial requirements for manipulation of input data produces opportunity for error that creates major time demands in troubleshooting.
• ? Calibration and verification for specific uses can be substantially more difficult than is readily apparent from the guidance manual.
• ? Independent validity checks need to be done to validate system output.
• ? If specified calibrating procedures do not produce reasonable results, reestimating slope coefficients is an option, but this requires resources and expertise that can easily exceed the limits of most users.

These are problems typical of most complex models. Reviews such as this can help users to appreciate the level of data required, and to use the MWD-MAIN System in a more effective and efficient manner.     

AN ASSESSMENT OF WATER UTILITY INFORMATION SYSTEMS AND THEIR USE OF COMPUTERS1

To provide an overview of water utility information systems and the extent of computer use, a direct mail survey of all water utilities serving populations of 2,000 or more in the tri-state area - Ohio, Indiana, and Kentucky - was conducted. The following was determined: 1) utility profile information, e.g., public/private ownership, age, number of accounts, etc.; 2) an assessment of the degree of computerization presently in place to perform various functions; and 3) an assessment of any plans that the utilities may have for future computerization. To analyze the data, an index of computerization was defined as the number of departments or major activity areas of each utility that presently have some computerization. The relationship between the degree of computerization (measured by this index) and a utility's profile in terms of population served, annual revenue generated, and the number of customer accounts is discussed for each state in the survey. Discriminant analysis revealed strong significant differences between utilities that plan to use computers and those that do not. The differences were identified by the authors. Survey results revealed a rather limited use of computers in the tri-state area. Enormous potential exists in small and medium sized utilities for computerization to improve operational efficiency.     

THE IMPACT OF POLICY VARIABLES ON RESIDENTIAL WATER DEMAND AND RELATED INVESTMENT REQUIREMENTS1

Increasing population and urbanization necessitate very large investments in municipal water supply. These investments could be more efficiently deployed if the impact of policy variables such as marginal pricing, metering, by-laws on lawn watering and plumbing fixtures, and higher summer charges were known. The paper in particular advocates the replacement of the present declining block rate by an increasing block rate. In order to know the impact of policy variables, a multiple regression model is built; the fitted model is tested against some data not included in calibrating the model. Next the impact of selected policy variables on the target variable (residential water demand during summer) is worked out for a new urban community of 200,000 people. The investment requirements may decrease appreciably as a result of a price increase when marginal (or commodity) charges are low but the impact of price changes when commodity charges are already high is less evident and non-price policy variables may be more effective in maintaining high quality water and also satisfying the constraint of limited budgets for municipal services.     

STATISTICAL ANALYSIS OF WATER CONSUMPTION1

The purpose of this study was to determine the degree of influence of various factors on municipal water consumption in Illinois. For the collection of basic data, questionnaires were sent to all public water works of incorporated towns. The questionnaire was designed to obtain information on factors which may have any effect on water use. The effects of the different parameters on water consumption were based on several correlation and regression combinations of predictands and predictors. It was found that in the Chicago region the percent of services and water used for commercial and industrial purposes and the age of the water works were the most important parameters influencing water consumption (gallons per capita per day) when pumpage is metered at the water works as well as at the customers. For the State, excluding the Chicago region, percent of public water use, persons per service, population and commercial and industrial water use were the most important parameters. It has been recommended that similar statistical analysis be conducted periodically to establish a trend or law of change from the influencing parameters.     

A MUNICIPAL WATER SUPPLY INVESTMENT PROBLEM IN RHODE ISLAND1

ABSTRACT: The traditional “requirements” approach to water system planning presumes perfectly inelastic demand and arbitrarily selects a fixed water requirement per capita per day as a planning target. Economists have often pointed out that such a policy leads to over-investment in water supply facilities; a superior approach would maximize some measure of net benefits incorporating price-sensitive demand. Using a dynamic programming model to depict an investment problem in Rhode Island, we find that ambiguities about how to incorporate price-sensitive demand into a decision framework may make such an approach as arbitrary as the requirements approach. Water conservation responses may be a function of other social parameters than water price; if so, variations in these social parameters should be regarded as economic alternatives to water supply investments.     

CAPITAL COSTS OF RURAL WATER SYSTEMS: AN EMPIRICAL APPROACH1

ABSTRACT: In the last two decades the federal government has provided substantial capital to construct rural water distribution systems. Loans at subsidized interest rates and front-end grants through the Farmers Home Administration have been the main source of this capital. Recent federal policy redirections have reduced substantially the availability of grants and subsidized loans. Because of design and material differences, capital cost estimates from urban systems are not uniformly applicable to rural water services. This study presents an econometric analysis of capital costs, using Illinois rural water system construction contract bids. Cost equations by systems components representing 90 percent of capital costs are estimated. The type of information developed here can be used in initial planning and optimization design models contributing to the efficient provision of rural water services.     

SIMULATION OF INTEGRATED SURFACE WATER AND GROUND WATER SYSTEMS - MODEL FORMULATION1

ABSTRACT: The unique characteristics of the hydrogeologic system of south Florida (flat topography, sandy soils, high water table, and highly developed canal system) cause significant interactions between ground water and surface water systems. Interaction processes involve infiltration, evapotranspiration (ET), runoff, and exchange of flow (seepage) between streams and aquifers. These interaction processes cannot be accurately simulated by either a surface water model or a ground water model alone because surface water models generally oversimplify ground water movement and ground water models generally oversimplify surface water movement. Estimates of the many components of flow between surface water and ground water (such as recharge and ET) made by the two types of models are often inconsistent. The inconsistencies are the result of differences in the calibration components and the model structures, and can affect the confidence level of the model application. In order to improve model results, a framework for developing a model which integrates a surface water model and a ground water model is presented. Dade County, Florida, is used as an example in developing the concepts of the integrated model. The conceptual model is based on the need to evaluate water supply management options involving the conjunctive use of surface water and groundwater, as well as the evaluation of the impacts of proposed wellfields. The mathematical structure of the integrated model is based on the South Florida Water Management Model (SFWMM) (MacVicar et al., 1984) and A Modular Three-Dimensional Finite-Difference Groundwater Flow Model (MODFLOW) (McDonald and Harbaugh, 1988).     

WATER RESERVOIR SYSTEMS1

. Water Reservoir Systems were investigated for urban areas as an alternative or complement to storm water drainage systems for flood control which could provide benefits in water conservation and reduce drainage system costs. The study consisted of: (1) gathering of engineering data on the topographical, hydrological, and precipitation characteristics of the area and urban development and economic statistics     

AN APPLICATION OF MATHEMATICAL PROGRAMMING TO WATER RESOURCES PLANNING: AN ECONOMIC VIEW1

ABSTRACT: Individuals involved in state water resource planning generally have avoided any development of a comprehensive public water planning investment model that would set the stage for quantitative recommendations of a “what ought to be” tone for future water strategies. Three New Hampshire towns were selected to illustrate the usefulness of a mixed integer multiperiod programming model that utilizes hydrologic and economic data for identifying the discounted least cost of water supply, distribution, and scheduling. Comparisons are made regarding the feasibility of a regional water system approach versus independent “town by town” water supplies that presently prevail. To analyze the sensitivity of optimal water planning solutions to projected water demands, variations in these demands are made.     

A LINEAR ANALYSIS OF AN URBAN WATER SUPPLY SYSTEM1

The use of linear programming as a planning tool for determining the optimal long-range development of an urban water supply system was explored. A stochastic trace of water demand was synthesized and used as an input to the model. This permitted evaluating the feasibility of imposing demand restrictions as an effective cost reduction mechanism. The City of Lincoln, Nebraska, was used as the urban model. The fundamental problem was to allocate limited water supplies from several sources to an urban load center to minimize costs and comply with system constraints. The study period covered twenty years, and findings indicate the planning direction for stage development during this period. Sensitivity analyses were performed on cost coefficients and demands. Thirteen sources were included in the initial computations. Conclusions were that linear programming and generated demand traces are useful tools for both short- and long-term urban water supply planning. Lowering peak demands results in long-range development of fewer sources of supply and more economic and efficient use of the supplies developed.     

REGULATORY WATER QUALITY MONITORING: A SYSTEMS PERSPECTIVE1

ABSTRACT: Regulatory water quality monitoring has evolved to the point where it is a rather complex system encompassing many monitoring purposes and involving many monitoring activities. Lack of a system's perspective of regulatory monitoring hinders the development of effective and efficient monitoring programs to support water quality management. In this paper the regulatory water quality monitoring system is examined in a total systems context. The purposes of regulatory monitoring are reviewed and categorized according to their legal evolution. The activities of regulatory monitoring are categorized and organized into a system which follows the flow of information through the monitoring program. The monitoring purposes and activities are combined to form a monitoring system matrix - a framework within which the total regulatory water quality monitoring system is defined. The matrix, by defining the regulatory monitoring system and clarifying many interactions within the system, provides a basis upon which a more thorough approach to managing, evaluating, and eventually optimizing regulatory monitoring can be developed.     

DUAL PURPOSE DETENTION BASINS IN STORM WATER MANAGEMENT1

Storm water management contributes to flood hazard mitigation; but new approaches now being developed consider also the reduction in particulate pollution and stream erosion. Such approaches involve retardation of storm runoff, or detention programs of some kind, and detention basins are usually required if large storms are to be controlled. The usual concept is that future storms occurring after development should have no more adverse effect than similar storms would have had before development; but a number of different criteria are being used. If control of storms of different sizes is required, only a small amount of additional capacity is required to obtain retention of particulate pollution in the same basin. In at least three different parts of the country, such dual purpose detention basins are being required of developers. In such programs the developers bear the cost, the governmental contributions are not involved.     

MULTICRITERIA PROGRAMMING OF WATER SUPPLY SYSTEMS FOR RURAL AREAS1

ABSTRACT: The aim of this paper is to present a multicriteria methodology for decision aid at the stage of programming a water supply system (WSS) for a rural area. The programming stage is an intermediate one between planning and designing water supply facilities, and can be decomposed into two problems: (a) setting up a priority order of water users, taking into account socio-economic criteria; and (b) choosing the best technical variant of the WSS. Among the criteria considered for the latter problem, there is a criterion of distance between the socio-economic priorities of users and the precedence orders of users according to the technical programming, which plays a coordinating role between problems (a) and (b). All steps of the presented methodology are illustrated by a real case study.     

MULTI-CRITERION RANKING OF ALTERNATIVE LONG-RANGE WATER RESOURCE SYSTEMS1

ABSTRACT The definition and comparison of alternative water resource systems designed to meet long-range goals (say 60 years) is illustrated by a case study in Hungary. A comprehensive cost-effectiveness approach is adapted to define goals, specifications, criteria, alternatives and their capabilities. Specifications include demands given in probabilistic terms. The comparison of alternative systems is based on 12 criteria, one of which is the balance between total energy consumed and peak energy produced. Important factors involving social elements, such as flood protection and land and forest use, are described both as monetary quantities and as qualitative appreciations. Five alternative systems are defied involving flat land reservoirs, pumped storage reservoirs, interbasin transfer, and conjunctive use of surface and ground water. International cooperation is then used to rank systems and reduce the problem to a tradeoff between only two alternatives.     

IMPACT ON RESIDENTIAL WATER CONSUMPTION OF AN INCREASING RATE STRUCTURE1

ABSTRACT: A two-step procedure is used to estimate the impact of an increasing rate structure on residential water use. An error components regression procedure is used to estimate demand relationships for a period prior to the rate change. Water use is predicted for the post rate change period, assuming that the rate structure was not changed. Comparison of actual with predicted use indicate that water use declined as a result of the imposition of the increasing rate structure.     

USE AND MISUSE OF COMPLEX MODELS: EXAMPLES FROM WATER DEMAND MANAGEMENT1

ABSTRACT: The power of computers has increased in recent decades, and one might expect improved management to result because decisions can be made with understanding available only via models. However, there is potential for quite the opposite: poor decisions due to unrealistic model output generated by users without access to appropriate training in the use of models. We discuss and, by reference to water demand models (IWR-MAIN, MWD-MAIN), illustrate three areas in which unintended errors of judgment by untrained personnel may cause difficulty:

• * Attributes of management models; if output from any type of model has no measure of confidence, then results may be over- or undervalued
• * Input data; with complex models, problems here typically will be difficult to detect.
• * Calibration and history-matching (verification); if these steps or data are combined, then users should be less trustful of model output than otherwise.

Because all models have weaknesses and because there always is uncertainty about output from any model, we end with suggestions for coping with complex models. Monitoring programs play a central role in such efforts because they can identify discrepancies between model predictions and actual events and because they can ensure time is available to develop solutions for problems unanticipated in the modeling effort.