New hydro-economic system dynamics and agent-based modeling for sustainable urban groundwater management: A case study of Dehno, Yazd Province, Iran

https://doi.org/10.1016/j.scs.2021.103078Get rights and content

Highlights

  • A hydro-economic model was applied to enhance groundwater sustainability.

  • A combination of system dynamics and agent-based simulation was applied.

  • Dynamic pricing was performed based on several parameters to sustainable consumption and cover strategy costs.

  • The case study of water shortage could be solved with proper demand management

  • In the crisis, only a combination of all the strategies (monitoring, pricing, culture, rationing) will work.

Abstract

Water scarcity invariably poses a threat to the sustainability of cities and rural areas with limited resources, especially in developing countries. This paper presents a new hydro-economic model based on system dynamics and agent-based simulation to enhance the sustainability of urban groundwater. Dynamic pricing was performed based on several parameters, such as resource conditions, price elasticity, consumption history and climate change, to improve the sustainability of groundwater and cover the costs of implementing strategies. Different scenarios based on pricing, rationing, culturalizing, and non-revenue water control strategies were applied in the village of Dehno in Yazd Province as the case study with an arid climate. The results showed that several scenarios can achieve the goal, but, in drought conditions, only a combination of all the strategies will work.

Introduction

Growing human activities, rapid socio-economic development and drought conditions have caused changes in water-related environmental issues, such as long-term shortage of water resources, rapid deterioration of water quality, scarcity, and degeneration of aquatic ecosystems. These changes are detrimental to the coordinated management of water systems for sustainable urban and rural areas (Cui, Chen, Xue, Li, & Zeng, 2019; Echeverría, 2020). In recent years, most Middle Eastern countries have experienced a growing scarcity of freshwater resources. This scarcity, along with pollution, calls for a change in water policies and a better focus on the society’s preferences in connection with the use of water and development, thus to ensure the availability and sustainable management of water and sanitation for all (SDG6). Water management, as it is nowadays, does not adequately tend to modify the existing policies, derive the necessary directives, or bring water issues under long-term planning (Ho, Alonso, Forio, Vanclooster, & Goethals, 2020). Changing the focus of water management approaches from supply to demand can improve water conservation and sustainability. In this respect, specific adaptive management policies are needed for a transition towards groundwater sustainability. Sustainability in this sense would refer to the exploitation of water resources for the present needs while maintaining them for future generations without adverse environmental, economic and social consequences (Yusuf et al., 2020). Achieving this goal entails pricing, public awareness, culturalization, technical tools, water recycling and sewage systems (Hof, Blázquez-Salom, & Garau, 2018). Hydro-economic solutions can serve as promising tools for the more efficient management of water resources (Alamanos, Latinopoulos, Papaioannou, & Mylopoulos, 2019). Scarcity pricing is an effective strategy to reduce demand while simultaneously generating additional revenues (Sahin, Siems, Stewart, & Porter, 2016). Setting low water prices leads to water wastage and is considered as an ineffective policy in a water management system. (Mercadier & Brenner, 2020). There are several methods to solve the complexity of water management, hydro-economic modeling, and inclusion of complex parameters such as feedback, interdependence and emergence (Guerrero, Schwarz, & Slinger, 2016). Using an agent-based or system dynamics model is an example of such methods. In an agent-based model, the behavior of the system emerges bottom-up from the interactions of individuals with one another and with their environment based on a set of pre-specified rules. A system dynamics model, however, represents the behavioral pattern of the system based on generalizable underlying structures whose main elements are endogenous feedback and accumulation of quantities over time. Unlike the agent-based method, a system dynamics model is usually presented at an aggregate level (i.e., with a top-down structure) and has broader boundaries (Morshed, Kasman, Heuberger, Hammond, & Hovmand, 2019).

A lot of research has been done in the fields of hydro-economics and water pricing for sustainable urban water management. Tortajada, González-Gómez, Biswas, and Buurman (2019) reviewed water demand management strategies for water-scarce cities in Spain. The result showed that education, awareness raising for water conservation and promotion of water-saving technologies have major impacts on sustainable water consumption. Babamiri, Pishvaee, and Mirzamohammadi (2020) conducted a financial analysis of sustainable management strategies of urban water distribution networks under an increasing block tariff structure with a system dynamics approach. Rojas, Garcia-Vega, and Herrera-Torres (2019) explored economic policies and their role as a tool for managing the sustainability of water resources. Lopez-Nicolas, Pulido-Velazquez, Rougé, Harou, and Escriva-Bou (2018) showed the best urban water-saving solution based on economic solutions. Molinos-Senante and Donoso (2016) examined the impact of water tariffs on drought conditions for sustainable urban water management. They showed that hydro-economic modeling improves water use sustainability. Fan (2019) explored hydro-economic models of sustainable water resource management. Sahin et al. (2016) offered several methods to control demand, such as pricing in drought conditions. They also advocated hydro-economic models to protect urban water during droughts (Sahin, Bertone, Beal, & Stewart, 2018). Massarutto (2020) reviewed the theoretical and applied literature in the field of residential water economic models. He provided many examples of approaches and solutions that are more consistent with the sustainability theory. Mercadier and Brenner (2020) analyzed tariff sustainability in Buenos Aires water and sanitation concessions amidst economic instability. Water scarcity exerts a significant influence on price elasticity and sustainable cities. If water scarcity is severe, household responsiveness to prices decreases, though this effect is attenuated in environmentally concerned communities (Garrone, Grilli, & Marzano, 2019). Favre and Montginoul (2018) reviewed hydro-economic models in Tunisia for the sustainability of cities and showed the cost-recovery principle strongly depends highly on high-consumption households. The affordability principle was found to only concern piped households. The averaging-out principle does not indicate the local scarcity value of water. Al-Saidi (2017) reviewed urban water economic models for sustainable consumption in Yemen. He compared increasing block tariffs with other pricing schemes.

Due to the excessive extraction of groundwater for intense agricultural activities, Yazd plain, a water-scarce district in the center of Iran, has been faced with a serious water crisis during the past decade. This is more or less like the conditions in the other regions of Iran. Appropriate pricing can have a positive effect on water consumption in Iran. In some past research works, the extent of this effect is calculated. Through a systematic review and meta-analysis, Shadivand, SAYEH, and ASKARI (2019) investigated the factors affecting the price and income elasticity of household water demand in Iran. Using Rosenthal and Robin's approach in the systematic review, the effects of price and income elasticities were calculated for household water demand. Then, based on the heterogeneity of the calculated effects, random and fixed models were used to combine the results. Rezaee and Shojaa (2020) estimated the income and the price elasticity of Kermanshah urban water demand. Price elasticity indicates a negative correlation between price changes and water demand. If the price of water increases by 10 %, the demand for it will decrease by 4.3 %. Abolhasani, Tajabadi, and Shahnoushi Forushahi (2018) reviewed 21 empirical case studies in Iran from which 65 estimates of price elasticity for residual water demand were collected. The inclusion of income, use of time-series datasets, natural logarithm function of demand and application of the stone-gray theory were all found to affect the estimate of price elasticity. The population density and the use of OLS techniques to estimate the demand parameters did not significantly influence the estimate of price elasticity.

To implement a hydro-economic model of urban water management, practical straightforward measures, effective incentives, and fines should be taken into consideration. This makes water consumption optimal (Sharifi, 2020). For example, the inclusion of a subscriber’s consumption history in pricing may create an incentive for saving, or an exponential increase in prices as a fine may be a deterrent for those who consume a lot. Paying attention to these points complements the research work of others. For urban water sustainability management, this study proposes a model with hydro-economic considerations in social and individual dimensions. The price dimension includes cost, supply-demand balance, resource conditions (i.e., the sustainability of groundwater), and rainfall. The bill, which represents the households section of water pricing, is calculated based on consumption pattern, history, price elasticity, and comparison with others. This case study was planned to focus on the sustainability of urban groundwater. It was due to its special circumstances that the village of Dehno in the province of Yazd was selected for the study. The area has a dry climate and is beset with an extended drought. The purpose of the study is not to determine the price-demand or elasticity function; rather, water pricing is considered as a tool to control consumption in favor of groundwater sustainability. It also covers the costs of the proposed strategies.

As indicated in Fig. 1, the study was carried out through a number of steps. After the problem was identified, an area was selected for a case study. Once the possible solutions were reviewed for the problem, a hypothesis was extracted. The problem was modeled through system dynamics and agent-based methods. The pricing formula, taxes, duties and incentives were calculated too. The results of the model simulation were consistent with the past real behavior of households, and the structure was successfully evaluated through a test. Then, different scenarios of demand management were tested to select the best one that could maintain the sustainability of water resources in drought conditions, meet the costs of the water supply company, and cause the least dissatisfaction.

The rest of this paper is organized into several parts. The second part presents the methodology of the study. In the third part, the results of strategy implementation are offered, and the fourth part discusses those results. Finally, the fifth part ends the paper with the conclusion.

Section snippets

Case study

Dehno is a rural area in the province of Yazd, Iran, with a population of about 5000 in 1000 families. The area has arid climatic conditions with low rainfall and high evaporation. It is located far from seas (500 km to the Persian Gulf and 700 km to the Caspian Sea) and in the vicinity of a vast desert with low relative humidity and high temperature (Fig. 2).

Dehno has been selected for a case study for several reasons:

a) The area has an arid climate. Recently, it has suffered from drought, and

Model validation

A model can simulate the behavior of a system reliably only if the designer includes his real needs in it (Homer & Oliva, 2001). There are different evaluation and validation methods to compare simulated and actual data (Barlas, 1996), including the tests introduced by Forrester and Barlas (Legasto, Forrester, & Lyneis, 1980; Sweeney & Sterman, 2000). The time was divided into two periods, from 2018 to 2019 for a two-year evaluation and comparison with the past and from 2019 to 2025 for a

Discussion

According to the results gained from the scenarios and based on Fig. 12 and Table 4, there are certain points worth discussing.

  • The increase of price alone in the long term has little effect on the sustainability of water resources. If combined with proper rationing, however, it yields better results. If prices rise too much or rations become too tight, local resources are widely used, which decreases the infiltration of shallow local aquifers into deep drinking water aquifers. This strategy

Conclusion

Water allocation depends on exogenous development drivers, economic benefits, and the society’s perception of water preferences (Dalcin & Fernandes Marques, 2020). Hydro-economic models can serve as valuable tools for the better understanding of water allocation systems as well as the improvement of decision-making and water resources management (Alamanos et al., 2019). System dynamics and agent-based modeling are also powerful tools for resource simulation and integrated water resource

Declaration of Competing Interest

The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.

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