Making decisions on industrial water sources: the case of Zaragoza, Spain

ABSTRACT

In Southern Europe numerous areas suffer water scarcity. For public policies to be effective, a thorough study of water users must be conducted. This paper aims to analyse the key factors that influence the decision of industrial users in urban areas when choosing between withdrawing water from underground sources or using water supplied through the public network. Using a database of industrial firms in Zaragoza (Spain) the proportion of water drawn from wells is considered as the dependent variable of a fractional response model. This methodology provides an original contribution to the field of behavioural analysis of the industrial sector, enabling us to model industrial decisions on water sources. The results obtained show that the most significant decision-drivers are how the industries use the water, the firms’ location and the accessibility of the different sources. Moreover, the findings indicate that firms use lower proportions of well water during the summer.

KEYWORDS:

• Fractional response models
• industrial water use
• water source
• well
• public network

Acknowledgements

We would like to thank Juan Arbués for his technical assistance in designing the map.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1. In most EU countries (current exceptions are England, Wales, and the Czech Republic), network and other water infrastructures’ ownership remains in public hands, even if water services management is externalized to a private company.

2. There is only one administrative concession to withdraw water from surface bodies (Ebro River) in the municipality of Zaragoza. This company is located in a meander of the river and it is authorised to extract a quantity of water, which would prove impossible to be extracted from a well (3,722,976 m³/month).

3. These studies develop the theoretical framework of fractional response models and their empirical application. Moreover, some of them provide the Stata commands to carry out the applications.

4. QML procedure is implemented in Stata through the generalized linear model (GLM) command fraglm (Williams 2018).

5. For further information, see https://sabi.bvdinfo.com/.

6. All the wastewater discharges must meet the quality standards established in the Spanish regulations that transpose the European Water Framework Directive (2000/60/EC). Furthermore, the City Council and the River Basin Authority monitor wastewater discharges and they can apply coercive measures in order to enforce these regulations.

7. The diameter of the meter installed is the same as that of the service pipe bringing water to the user from the main pipeline of the public network. Thus, the diameter of the water meter indicates the maximum quantity of water per hour that a user can withdraw from the public network. Moreover, the larger the diameter of the meter, more simultaneous uses of water can be occurring (for more details see American Water Works Association 2012).The water meter is mandatory for all users connected to the public water supply network.

8. Nonetheless, the water tariff reform did not mean significant increases in the price level for industrial users. Even in some cases (i.e. large users) the price level was slightly reduced.

9. The most significant parameters regarding the physical and chemical quality of groundwater registered in the control stations of the River Basin Authority show significant differences between summer and winter periods (CHE 2019b). Thus, in the period 2004–2006 it could be observed that groundwater at Zaragoza reached lower concentrations of NO_3, CO₂, Na, SO₄, Al, Fe or Mg in the winter than in the summer. Other quality parameters such as the levels of BOD and COD, the ph and the temperature of groundwater are also worse in the summer. For more details about the values of the quality parameters see CHE (2019b).

10. Note that all the industries in the sample are registered as well users, so the well depth is always higher than 0.

Additional information

Funding

This work was supported by the Spanish Ministry of Economy and Competitiveness and the European Regional Development Fund under Grant ECO2016-75237-R; the National Institute for Agricultural and Food Research and Technology (INIA) under Grant RTA-2017-00082-00-00; and the Government of Aragon (Spain) and the European Social Fund under Grant S23_17R and S40_17R.