Large‐Scale Desalination and the External Impact on Irrigation‐Water Salinity: Economic Analysis for the Case of Israel

Abstract

Recent agroeconomic studies in water-scarce countries such as Spain, Australia, Saudi Arabia, and Israel have revealed the economic viability of irrigating high-value crops with desalinated water. However, the worldwide growth of large-scale desalination capacities is primarily designed to resolve urban-water scarcity, disregarding the impact of desalination on irrigation-water salinity. We develop a dynamic hydroeconomic programming model where infrastructure capacities and allocations of water quantities and salinities in a regional water distribution network are endogenous. We show that subsidizing desalination is socially warranted because the associated reduction in irrigation-water salinity is an external effect of water consumption by all water users. Empirical application to the entire state of Israel indicates that large-scale desalination of seawater and treated wastewater for irrigation is optimal. This result stems from the large share of irrigation-intensive salinity-sensitive high-value crops, motivated by Israel's policies to support local agriculture. Ignoring salinity results in a 45% reduction in desalinated irrigation water, a 29% reduction in farming profits, a 250% increase in water suppliers' profits, and an average deadweight loss of $1,200 a year per hectare of arable land.

Institutions and the Economic Efficiency of Managed Aquifer Recharge as a Mitigation Strategy Against Drought Impacts on Irrigated Agriculture in California

“…Instead of developing the modeling capacity required for the regional analysis from scratch, we adopt the integrated model presented in Slater et al (2020) and adapt it to our needs. Our analytical framework differs from the one shown in Slater et al (2020) by explicitly representing several hydrogeological principles relevant for the analysis in this paper.…”

“…3 of 28 sources and its impact on crop yield-established within the economic literature on irrigation water salinity (Connor et al, 2012;Feinerman & Yaron, 1983;Knapp, 1992;Letey & Dinar, 1986;Schwabe et al, 2006, to name a few examples). A nationwide hydroeconomic framework of competing demand sectors, incorporating salinity response functions in agriculture was recently developed by Slater et al (2020). We supplement that work through explicit representation of hydrogeological principles, within a framework termed by MacEwan et al (2017) as embedded hydrologic response function model integration, also accounting for MAR costs and benefits, as will be detailed below.…”

The Health of the Water Planet: Challenges and Opportunities in the Mediterranean Area. An Overview

“…Currently, in some Countries, including Israel, the problem of water salinization is partially solved through desalination technologies. However, due to high procurement costs and adverse environmental effects, large-scale desalination is still underdeveloped and not sustainable for many DCs [75]. The problem of salinization makes SDG 6 impossible to achieve, also preventing the achievement of target 6.1 "safe water", target 6.3 "better water quality", and target 6.5 "integrated water resources management".…”

Hydroeconomic Analysis to Guide Climate Adaptation Plans

“…Water transpires, evaporates, leaks, and seeps all four of which make it difficult to establish private property rights, build infrastructure, enact comprehensive legislation governing its development and use, or get to people at the time, place, and form in which they need it. Even today, water has a low ratio of value to weight as it moves through the hydrologic cycle (Tui et al, 2013;Kovacs and Durand-Morat, 2020;Slater et al, 2020).…”

“…Several very recent works in 2020 alone from many places internationally have looked at climate adaptation challenges (Alamanos et al, 2020;Baah-Kumi and Ward, 2020;Burek et al, 2020;Carolus et al, 2020;Dawoud, 2020;Do et al, 2020;Exposito et al, 2020;Goncalves et al, 2020;Graveline, 2020;Konapala and Mishra, 2020;Maneta et al, 2020;Meng et al, 2020;Pakhtigian et al, 2020;Sabbaghi et al, 2020;Slater et al, 2020;Tran et al, 2020;Turner et al, 2020).…”