IDEAS home Printed from https://ideas.repec.org/a/spr/waterr/v37y2023i12d10.1007_s11269-023-03569-y.html
   My bibliography  Save this article

Farm-level Hydroeconomic Analysis of Alternative Water Tariff Charges Using a Hybrid Solution Method

Author

Listed:
  • Bennie Grové

    (University of the Free State)

  • Johannes Jacobus Bezuidenhout

    (University of the Free State)

  • Nicolette Matthews

    (University of the Free State)

Abstract

This paper's main objective is to develop a farm-level water programming model to realistically model extensive margin and intensive margin responses resulting from deficit irrigation to the implementation of volumetric water charges. The highly complex programming model that uses the FAO56 water budget calculations to simulate crop water use while using relative evapotranspiration to estimate crop yield is solved using a hybrid procedure. The hybrid solution procedure uses a genetic algorithm to simplify the optimization model by fixing the irrigation schedule of each crop and then solving for the optimal water allocation amongst crops subject to water constraints. The area-based charges results showed that when irrigation application efficiency is low, irrigators could apply more water per hectare to sustain high crop yields without being held accountable if water quotas are exceeded. In contrast, irrigators with higher application efficiency could use less water than the area-based estimated water use. The results also showed that volumetric water charges cause both intensive margin and extensive margin responses. The conclusion of whether a volumetric-based water charging system will be better than area-based water charges is not straightforward because of differentiated impacts on profitability and hydrology. While irrigators will use irrigation water more efficiently and adopt more efficient irrigation technologies, their changed behavior could impact the hydrology of the water system through reduced return flows.

Suggested Citation

  • Bennie Grové & Johannes Jacobus Bezuidenhout & Nicolette Matthews, 2023. "Farm-level Hydroeconomic Analysis of Alternative Water Tariff Charges Using a Hybrid Solution Method," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 37(12), pages 4679-4692, September.
    • Handle: RePEc:spr:waterr:v:37:y:2023:i:12:d:10.1007_s11269-023-03569-y
    DOI: 10.1007/s11269-023-03569-y
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11269-023-03569-y
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11269-023-03569-y?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Mohammad Ismaeil Kamali & Hossein Ansari & Rouzbeh Nazari, 2022. "Optimization of Applied Water Depth Under Water Limiting Conditions," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(11), pages 4081-4098, September.
    2. Dono, Gabriele & Giraldo, Luca & Severini, Simone, 2010. "Pricing of irrigation water under alternative charging methods: Possible shortcomings of a volumetric approach," Agricultural Water Management, Elsevier, vol. 97(11), pages 1795-1805, November.
    3. Javier Martínez-Dalmau & Carlos Gutiérrez-Martín & Alfonso Expósito & Julio Berbel, 2023. "Analysis of Water Pricing Policy Effects in a Mediterranean Basin Through a Hydroeconomic Model," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 37(4), pages 1599-1618, March.
    4. Foster, T. & Brozović, N., 2018. "Simulating Crop-Water Production Functions Using Crop Growth Models to Support Water Policy Assessments," Ecological Economics, Elsevier, vol. 152(C), pages 9-21.
    5. Sapino, Francesco & Pérez-Blanco, C. Dionisio & Gutiérrez-Martín, Carlos & García-Prats, Alberto & Pulido-Velazquez, Manuel, 2022. "Influence of crop-water production functions on the expected performance of water pricing policies in irrigated agriculture," Agricultural Water Management, Elsevier, vol. 259(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rouhi Rad, Mani & Haacker, Erin M.K. & Sharda, Vaishali & Nozari, Soheil & Xiang, Zaichen & Araya, A. & Uddameri, Venkatesh & Suter, Jordan F. & Gowda, Prasanna, 2020. "MOD$$AT: A hydro-economic modeling framework for aquifer management in irrigated agricultural regions," Agricultural Water Management, Elsevier, vol. 238(C).
    2. Prakashan Veettil & Stijn Speelman & Guido Huylenbroeck, 2013. "Estimating the Impact of Water Pricing on Water Use Efficiency in Semi-arid Cropping System: An Application of Probabilistically Constrained Nonparametric Efficiency Analysis," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 27(1), pages 55-73, January.
    3. Buchholz, Matthias & Musshoff, Oliver, 2014. "The role of weather derivatives and portfolio effects in agricultural water management," Agricultural Water Management, Elsevier, vol. 146(C), pages 34-44.
    4. Zhang, Ting & Zuo, Qiang & Ma, Ning & Shi, Jianchu & Fan, Yuchuan & Wu, Xun & Wang, Lichun & Xue, Xuzhang & Ben-Gal, Alon, 2023. "Optimizing relative root-zone water depletion thresholds to maximize yield and water productivity of winter wheat using AquaCrop," Agricultural Water Management, Elsevier, vol. 286(C).
    5. Knowling, Matthew J. & Walker, Rob R. & Pellegrino, Anne & Edwards, Everard J. & Westra, Seth & Collins, Cassandra & Ostendorf, Bertram & Bennett, Bree, 2023. "Generalized water production relations through process-based modeling: A viticulture example," Agricultural Water Management, Elsevier, vol. 280(C).
    6. Kelly, T.D. & Foster, T., 2021. "AquaCrop-OSPy: Bridging the gap between research and practice in crop-water modeling," Agricultural Water Management, Elsevier, vol. 254(C).
    7. Buttinelli, Rebecca & Cortignani, Raffaele & Caracciolo, Francesco, 2024. "Irrigation water economic value and productivity: An econometric estimation for maize grain production in Italy," Agricultural Water Management, Elsevier, vol. 295(C).
    8. Wang, Yufeng & Kang, Shaozhong & Li, Fusheng & Zhang, Xiaotao, 2021. "Modified water-nitrogen productivity function based on response of water sensitive index to nitrogen for hybrid maize under drip fertigation," Agricultural Water Management, Elsevier, vol. 245(C).
    9. Buchholz, Matthias & Holst, Gesa & Musshoff, Oliver, 2015. "Water and irrigation policy impact assessment using business simulation games: evidence from northern Germany," Department of Agricultural and Rural Development (DARE) Discussion Papers 260781, Georg-August-Universitaet Goettingen, Department of Agricultural Economics and Rural Development (DARE).
    10. Reidsma, Pytrik & Janssen, Sander & Jansen, Jacques & van Ittersum, Martin K., 2018. "On the development and use of farm models for policy impact assessment in the European Union – A review," Agricultural Systems, Elsevier, vol. 159(C), pages 111-125.
    11. Shuang Liu & Geping Luo & Hao Wang, 2020. "Temporal and Spatial Changes in Crop Water Use Efficiency in Central Asia from 1960 to 2016," Sustainability, MDPI, vol. 12(2), pages 1-18, January.
    12. Paloch Suchato & Taro Mieno & Karina Schoengold & Timothy Foster, 2022. "The potential for moral hazard behavior in irrigation decisions under crop insurance," Agricultural Economics, International Association of Agricultural Economists, vol. 53(2), pages 257-273, March.
    13. Zhisong Chen & Huimin Wang & Xiangtong Qi, 2013. "Pricing and Water Resource Allocation Scheme for the South-to-North Water Diversion Project in China," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 27(5), pages 1457-1472, March.
    14. Sapino, Francesco & Pérez-Blanco, C. Dionisio & Gutiérrez-Martín, Carlos & García-Prats, Alberto & Pulido-Velazquez, Manuel, 2022. "Influence of crop-water production functions on the expected performance of water pricing policies in irrigated agriculture," Agricultural Water Management, Elsevier, vol. 259(C).
    15. Joey Blumberg & Christopher Goemans & Dale Manning, 2022. "Perceived Water Scarcity and Irrigation Technology Adoption," NBER Chapters, in: American Agriculture, Water Resources, and Climate Change, pages 173-201, National Bureau of Economic Research, Inc.
    16. Rouhi Rad, Mani & Brozović, Nicholas & Foster, Timothy & Mieno, Taro, 2020. "Effects of instantaneous groundwater availability on irrigated agriculture and implications for aquifer management," Resource and Energy Economics, Elsevier, vol. 59(C).
    17. Christian Franco-Crespo & Jose Maria Sumpsi Viñas, 2017. "The Impact of Pricing Policies on Irrigation Water for Agro-Food Farms in Ecuador," Sustainability, MDPI, vol. 9(9), pages 1-18, August.
    18. Lan Mu & Chunxia Luo & Zongjia Tan & Binglin Zhang & Xiaojuan Qu, 2023. "Assessing the Impact of Different Agricultural Irrigation Charging Methods on Sustainable Agricultural Production," Sustainability, MDPI, vol. 15(18), pages 1-19, September.
    19. Gabriele Dono & Luca Giraldo & Simone Severini, 2012. "The Cost of Irrigation Water Delivery: An Attempt to Reconcile the Concepts of Cost and Efficiency," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 26(7), pages 1865-1877, May.
    20. Humblot, Pierre & Jayet, Pierre-Alain & Petsakos, Athanasios, 2017. "Farm-level bio-economic modeling of water and nitrogen use: Calibrating yield response functions with limited data," Agricultural Systems, Elsevier, vol. 151(C), pages 47-60.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:waterr:v:37:y:2023:i:12:d:10.1007_s11269-023-03569-y. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.