In the twenty-first century, unprecedented water crises and conflicts are likely to occur in a growing number of regions around the world. The World Health Organization [1
] estimates that physical and economic water scarcity already affects more than 40 percent of the world’s population, with a rising trend. Among other factors, such as population growth, climate change and unsustainable management practices, rapid urbanization aggravates the challenge of ensuring sustainable and pervasive access to freshwater. In a variety of cities in the Global South, parts of the population live in informal settlements and remain unconnected to a water network. Many other urban water users have a connection but nevertheless experience water shortages and intermittent supply and are therefore unable to fully meet their water needs. For both cases—non-existent or intermittent public supply—there is wide evidence that additional water services are provided by small, private businesses [2
One form of water supply independent from a public network is the transport and sale of bulk water volumes from groundwater wells or surface bodies via tanker trucks. In Amman, Jordan, this type of water provision has been brought about by a chronic water scarcity that continues to keep the Hashemite Kingdom in its clutches. Measured in renewable freshwater resources, Jordan is among the 10 countries with the least water available per person and year [4
], while renewable water resources are exploited above sustainable yield rates throughout the country [5
]. Although nearly all households in Amman have a network connection [6
], the low availability of water, along with high network losses, has resulted in a chasm between the demand of all water users and the capacity of Miyahuna, Amman’s utility, to deliver the requested volumes [8
]. As a consequence, network supply in Amman is intermittent and ranges between 18 and 168 h per week, depending on the location within the city [9
]. Affected water users have found a variety of ways to deal with this, for instance by installing rooftop and basement storage tanks to balance times of discontinued supply or by investing in water-efficient appliances to reduce their water consumption [10
]. On top of that, many water users turn to tanker providers in order to meet their water requirements. The tanker operations pump water from both licensed and illegal groundwater wells in the vicinity of Amman and deliver it directly to the site of their customers [7
]. By doing so, they—along with other water users such as highland farmers—abstract groundwater from an aquifer exploited in an alarmingly unsustainable way. The Amman-Zarqa basin is in fact the most overpumped in the country [5
Although the academic literature has increasingly dealt with small-scale private water provision in the last two decades [3
], much of the literature on urban water scarcity and supply intermittency maintains a utility-centric perspective and merely discusses other water providers on the side. Tanker water provision is particularly under-researched, although there is evidence for its occurrence on all continents [13
]. To date, only a handful of studies investigate tanker water supply in depth. These mostly suggest that the high price of tanker water constitutes an economic burden and exacerbates social inequality, because the urban poor depend more heavily on it [14
]. For the Jordanian case, this argument has been put forward by Wildman [15
], who observed that wealthier water users have larger capacities to store the more affordable water provided through the network during times of supply. In addition, water provision through tanker operations has been interpreted as a welfare loss in the literature, resulting from a direct comparison with water from public networks [16
]. Tanker water has also been associated with groundwater depletion [16
] and conflicts between water users in peri-urban and urban areas [18
]. Klassert and colleagues [19
], however, have modeled residential water consumption in Amman and found that tanker water supply is very relevant for balancing the shortcomings of intermittent network supply and potentially during periods of crisis.
Most of the literature, nevertheless, seems inclined to interpret tanker water supply as problematic, while relatively few arguments are based on empirical evidence. In particular, information regarding the volume and characteristics of such water markets is missing, as well as assessments of potential contributions
to welfare resulting from tanker water provision. This gap is to some extent due to the aforementioned focus on public utility supply in the literature but is also caused by the frequently informal and spatially heterogeneous character of tanker water markets, which impede one-fits-all statements concerning their role in sustainable urban water supply. Evidence-based analyses that take spatial and seasonal differences in water consumption into account seem necessary in order to move forward in the discussion on tanker water provision. Moreover, it seems obvious that water users can behave quite differently within the same supply system, due to differences in individual water requirements, availability and prices. Water user groups other than residential and agricultural consumers, however, have received insufficient attention so far—not only in the specific literature on small-scale water providers but in general [20
As outlined above, previous research endeavors have shed light on the use of tanker water by households in Amman. As to whether other water users rely on tanker-provided water as well, and to which extent, far less is known. Recently, several empirical surveys concerned with the tanker water market in Amman were carried out by Sigel et al. [21
]: (i) a survey with 242 commercial establishments (commercials survey
), (ii) a survey with 300 tanker drivers (tanker drivers survey
) and (iii) a survey with 11 owners/managers of groundwater wells (well operators survey
). The commercials survey indicates that commercial water users much more frequently do not
have a network connection (44%) when compared to households (95%). While some establishments claimed to have no option to receive a connection, others stated that they voluntarily
refrain from having one. It therefore seems likely that the commercial sector relies to a greater extent on tanker water than residential users. This is substantiated by the results of the tanker drivers survey, in which the respondents claimed to sell approximately half of the total water volume delivered to commercial establishments (52%, opposed to merely 20% going to households). This potentially strong involvement of the commercial sector in the tanker water market might have several implications.
On the one hand, the comparatively low network connectivity among commercial water users suggests a significant use of tanker water of at least those parts of the commercial sector which rely on it as their only bulk water source [22
]. This implies a potential connection between groundwater exploitation and economic value creation in commercial establishments consuming tanker water. As a result, any policy aiming to reduce groundwater overdraft and scale down or end tanker water provision might have impacts on the commercial sector, which is the main source of employment in the Governorate Amman and therefore of social relevance [23
]. In another line of reasoning, the strong reliance on tanker water might be evidence for a financial burden on a water supply system which is already operated under severe losses. The commercial water users that refrain from cross-subsidizing the water network for all users and instead exacerbate groundwater stress by purchasing tanker water might adversely affect public interests.
With this paper, we aim to contribute to both the literature on tanker water provision and on commercial water use. We do so by carrying out a positive analysis of commercial water consumption in a systematic, spatially and seasonally differentiated way. As a result, we present an estimation of the volume of the market of tanker water for commercial establishments. Particular focus will be placed on investigating to which extent tanker water supply meets demands left unsatisfied by network water provision and to which extent it adds to consumer surplus. In addition, we discuss how commercial use of tanker water could be related to excess groundwater abstraction and the ongoing Jordanian water crisis. This objective is pursued by designing, implementing and analyzing an agent-based model (ABM) capable of simulating water consumption decisions of commercial establishments in different sizes and locations. The model draws on the conceptual structure of the prior ABM of residential water consumption in Amman by Klassert et al. [19
] but dedicates its full attention to the commercial sector. Moreover, our new model explicitly includes a representation of the supply side of the tanker water market, profits from a considerable increase in spatial resolution and incorporates preliminary findings of the three aforementioned surveys.
The remainder of this paper is structured in the following way: Section 2
describes the conceptual structure of our ABM of commercial water consumption in Amman and the underlying theoretic notions and assumptions. In Section 3
, we present where our data stems from and how it was processed. The methods of the model, particularly the water demand function and water distribution procedures, will be discussed in Section 4
. In Section 5
and Section 6
, we first present the most relevant results obtained from the simulation model and then discuss their implications. Section 7
2. Model Concept
In this section, we present an overview of the simulation model which enables this analysis and the underlying design concepts. While attempting to provide a transparent documentation that ensures reproducibility and allows an informed interpretation of results, it can be challenging to find a balance between giving a full and lucid description and avoiding getting lost in detail. The elements of the following description have been chosen in consideration of the ODD + D protocol (Overview, Design Concepts, Details and Decision-Making) [24
], an amended version of the original ODD protocol proposed by Grimm and colleagues [25
] for the documentation of ecological ABM.
2.1. Model Overview
The purpose of the model is a simulation of network and tanker water consumption decisions of commercial establishments in different sizes and locations in Amman. Possible water allocations, i.e., appropriations of the available, scarce water resources to different consumers, are modeled by predicting and quantifying commercial water consumption decisions and are subsequently interpreted to assess the tanker water use of the commercial sector. The model is addressed to scientists, who can use the insights of the positive analysis for further studies, as well as policy makers, who can use the model results as information to consider in decision processes.
The model explicitly incorporates two human entities or groups of agents: Commercial establishments in different sizes and groundwater well owners. A third group of human actors—the tanker water drivers—are important for a conceptual understanding of the process through which tanker water is allocated but are modeled implicitly through certain actions taken by agents representing commercial establishments, i.e., they do not appear explicitly in the model code (cf. Appendix A
, Note 1). The central commodity and the only good which is traded and consumed by the agents in the model is freshwater, which can either stem from the piped network, run by Miyahuna, or from groundwater wells, run as private businesses.
The only consumers of water considered by the model are the commercial establishments, which are divided into two sub-groups: connected establishments receive (intermittent) supply from Miyahuna, unconnected establishments rely exclusively on tanker water. Regardless of the existence of a network connection, the model distinguishes between five commercial categories of different sizes, measured by the number of employees (1–4, 5–19, 20–49, 50–99 and >99 employees). The size of an establishment determines the values of proxy variables such as the number of toilets or the water storage size. These variables, along with the water prices, determine the demand of each commercial agent for water. While the price of network water is fixed in a uniform tariff, the price of tanker water is determined by the distance of groundwater wells, i.e., by the cost of fuel for water transport. Each commercial establishment attempts to cover its water demand as inexpensively as possible (cf. Appendix A
, Note 2).
Well owners are characterized by their location and by their ability to abstract groundwater at a certain rate, which is granted by a publicly issued license. Location and well yield determine how much water a well owner can pump and offer for sale and which customers he or she will serve. What a well owner cannot do is determine his or her sales price—this price is fixed by regulation [22
]. Tanker drivers, finally, connect commercial establishments with well owners by purchasing water at different wells and transporting it to the location of the establishment (implicitly modeled in code through commercial agents). For this service, they add a premium to the cost of water they incurred at the well. This premium consists of a charge that depends on the distance the water has to ‘travel’ in order to reach its consumer and a profit margin, determined by the willingness to pay of the commercial establishment which is served.
Both temporal and spatial factors are considered by the model. Time comes into play through seasonality: water demand in establishments varies between summer and winter. For both seasons (cf. Appendix A
, Note 3), the water allocation processes of one representative day are simulated and then extrapolated to yearly results. Space is another crucial aspect in the model design. The environment, in which the agents act, is an administrative landscape: the distribution zones (DZ) of Amman’s utility Miyahuna, which have different weekly durations of network supply. The locations of commercial establishments in each distribution zone are hypothetical and assumed to be at its center (To this end, the centroid
of each DZ polygon was determined). Groundwater wells, on the other hand, have been placed in the model environment based on real-world geo-data. In short, the locations of commercial agents have two effects: first, they determine for how long—or how much—network water can be accessed and, second, they determine the distance between each agent and the groundwater wells, which influences the price of tanker water.
Within a model run, i.e., the allocation of freshwater in one day, two separately scheduled processes occur. First, the available piped water is distributed among those agents with a connection to the network. Then, those without a connection and those that require more water than they received during piped water distribution attempt to purchase groundwater from the wells. The demand of the commercial establishments for water at different prices (willingness to pay) informs the tanker drivers, which purchase water from the well owners. These distribute the limited amounts of water at their disposal until they run out or until no commercial agent is interested in their water anymore. The outputs of the model are the water allocations among commercial establishments, i.e., agent-specific combinations of network and tanker water prices and quantities, which can be differentiated by the establishment’s location in Amman and by the size of the establishment, measured by the number of employees. In addition, the model uses the commercial water demand function (cf. Section 4
) to determine consumer surplus derived from the use of both tap and tanker water.
2.2. Design Concepts, Decision-Making and Assumptions
If we attempt to ‘step into the shoes’ of a restaurant owner in Amman, who faces network intermittency and can purchase tanker water from different wells, we might ask ourselves: Should network or tanker water be purchased? Or both? From which well should the tanker water be bought? These questions point at relevant decision-making processes.
We assume that the capabilities of commercial agents to make these decisions are constrained by factors such as incomplete information about the different supply options and uncertainty about the decisions of other water users. Therefore, some decisions in the model are based on simple heuristics, which corresponds to the economic concept of bounded rationality
, i.e., the idea that rational decision-making is limited by factors such as the complexity of the decision problem and constraints in cognitive capacities and time availability [26
]. We do, however, assume that the commercial decision-makers have a clear picture about the water needs of their establishment, which is reflected in the use of a water demand function.
The decision-making processes of individual human agents are conceptualized as follows: commercial establishments with a connection to the network first attempt to abstract as much water from the network as they demand at the given tariff. The agents make this choice because they bear fixed costs for a connection to the network and seek to distribute this cost across a preferably high quantity of water. In addition, they face uncertainty whether they could get tanker water at the (comparatively low) price of piped water and in the volumes they require. At this point, our model touches upon the economic concept of transaction cost, which denotes any type of cost associated with the exchange of a good or service, including factors such as communication, transport and finding information about prices, quality, etc. We assume that it is easier for a commercial establishment to use the tap during times of supply than to organize a delivery via tanker trucks, i.e., that transaction costs are lower. If the commercial agents receive as much water as they demanded from the network, they are satisfied and abstain from entering further rounds of distribution. If not, they enter the tanker water distribution, along with the establishments without a connection.
As a prerequisite for the tanker water distribution, the commercial establishments interested in tanker water determine their willingness to pay at different prices and communicate this to the tanker drivers. These now have to decide which well they purchase the water from. In order to offer low prices and save fuel, they decide to first head for the well that is closest to their customers. The tanker drivers now pay the fixed water charge at the well and add variable transport cost to calculate the price of water from this well. If they can get the amount of water their customers want at this price, they purchase this amount and abstain from further participating in the tanker distribution. If, however, they could not get enough water at this first well, the tanker drivers determine the price for the second closest well and assess whether their customers would demand water at this price. If so, they continue to the next closest well and participate in the distribution there. This is repeated with all other wells, if necessary, until the drivers either receive the quantity of water demanded (cf. Appendix A
, Note 4) at the price they can offer at a specific well or until no water is left at any well. This can result in a situation where tanker drivers have bundled water from different sources at different prices for the same commercial establishment. Since the establishment is willing to pay the price of water at the ‘last’ and most expensive well, the tanker drivers will charge this marginal price for the entire delivery (cf. Appendix A
, Note 5), even though it might include cheaper water from closer wells. This corresponds to the standard economic assumption of products being sold at their (local) marginal production costs. The tanker drivers are able to request the marginal price because their customers have incomplete information about the sources of water in their delivery.
The approach used for the determination of network and tanker water is inspired by the model-based analysis of residential water consumption in Amman by Klassert et al. [19
] and expands their approach (cf. Appendix A
, Note 6). In their study, the authors discussed water allocations and policy scenarios by adopting the tiered-supply-curve approach
that had been applied in a previous study of intermittent supply and tanker water provision by Srinivasan and colleagues [27
]. The tiered-supply-curve is advantageous for studying situations in which water users rely on water from multiple sources in different quantities and at different prices. According to Klassert et al. [19
], this is because “the consumption quantities from all sources considered and the consumer surplus generated by this consumption can be calculated based on a single demand function” (p. 3647). Figure 1
has been slightly altered from the representation by Klassert et al. for the purposes of this paper and can be used to illustrate the conceptual basis of the tiered-supply-curve approach (cf. Appendix A
, Note 7).
It is important to highlight at this point that through this approach and in the conceptual design of the model, water is assumed to be a homogeneous good. This, however, may not be the case in the real world. Studies of residential water use [10
] have revealed that network and tanker water serve different purposes in households and are viewed as goods with heterogeneous characteristics. Beyond that, the commercials survey has indicated that even groundwater from individual wells is perceived to be of different quality [22
]. Thus, there might be varying forms of use in the commercial sector for water from different sources, which could be assessed in future research (cf. Section 6
). In the model, we follow the line of reasoning that water from whichever source is stored in the same tank at the user’s site, thus justifying the use of the approach outlined above.
To complete the allocation of tanker water in the model, we further need to establish how the well owners decide to distribute their scarce water. In the real world, they obtain a license from water authorities and can only (legally) sell their water at a fixed rate. Given that they do not have the ability to discriminate prices, the model assumes that the well owners attempt to distribute their water relative to the water needs of the establishments that are sending the drivers (cf. Appendix A
, Note 10).
After the allocations of network and tanker water have been simulated, the consumer surplus
of each commercial establishment is determined by the model, based on the approach depicted in Figure 1
. Consumer surplus is understood in economics as a monetary measure of utility derived from the consumption of a good, which is calculated by subtracting the actual price of the good from the amount of money the consumer is willing to pay for it. In the model, the calculation of this measure serves two purposes: On the one hand, it is a proxy to assess the importance of each source of water for the consumers through the surplus derived from it. On the other hand, it can be used as a baseline for later research to compare the welfare effects and desirability of different water distribution regimes or policy scenarios (cf. Section 7
Our simulation suggests that tanker water provision is relevant for a significant part of the commercial sector in Amman, particularly among large establishments. Regardless of the year, we observe that more than 40% of the total water consumed by the commercial sector in summer stems from tanker trucks. During winter, the tanker share drops by a few percentage points but stays at a high level due to those establishments that consume tanker water exclusively. This result, along with the drop in the price of tanker water during winter, demonstrates that the distinction between seasons enhances our understanding of these markets. The same seems to hold for the spatially differentiated approach adopted here, which has revealed strong geographic disparities in water use for both sources considered. Together, the different durations of network supply and the dispersion of groundwater wells around the city create a high variability in tanker water prices and quantities demanded/consumed. This might suggest that for those establishments located in the proximity of a well cluster it is economically beneficial to opt out of the network allocation, while in other parts of the city a network connection provides cheaper access to water.
While this may not be sufficient to fully explain why so many establishments remain unconnected compared to the high connectivity rates of households, it is a plausible indication. The model results thus further substantiate the conjecture that commercial water consumption in Amman occurs in patterns very dissimilar from residential water use. Regardless of the range of potential explanations (cf. Appendix A
, Note 23), the low commercial connectivity has negative financial implications for the water system as a whole due to the cross-subsidizing role of commercial consumers, as argued by Klassert and colleagues [37
If our simulation accurately reflects reality, the total extent of commercial
tanker water consumption in Amman is roughly 9.7 million m3
per year. If this is extrapolated, under the assumption gathered from the tanker drivers survey, which indicated that the commercial sector receives around 52% of the tanker-supplied water, the total size of the tanker water market in Amman, i.e., the consumption of all user groups, amounts to roughly 18.7 million cubic meter per year. On the one hand, this demonstrates the existing gap between public supply volumes and water demand in Amman. In the current water supply system, tanker water contributes significantly to (commercial) welfare. On the other hand, the possible tanker market size establishes a substantial connection to groundwater extraction and is therefore of relevance for water management. To put our simulated tanker water market volume in context: the safe yield of the Amman-Zarqa basin is estimated at 87.5 million m3
per year, while it is currently exploited at a rate of approximately 166 million m3
per year [5
]. In such a situation, policy-makers aiming to enhance freshwater sustainability need to prioritize among competing water uses, which is reflected upon briefly in the next section.
While the real volume of the tanker water market in Amman remains unknown, our simulation for commercial water consumption has yielded results that exceed officially documented numbers considerably. These results, however, have to be interpreted with care for a number of reasons. First, the quality of model results depends strongly on the quality of input data. To some extent, the available data we used for the model constitutes a constraint, for instance with regard to supply durations and groundwater well yields. While the survey data used for the development of our model is the first of its kind and has enriched our understanding of the involvement of the commercial sector in the tanker water market considerably, we cannot exclude the possibility of some degree of bias in the data.
The majority of the results produced by our model, however, are in line with the findings of all three surveys of the tanker water markets in Amman. While there are only marginal deviations in prices, the model suggests a lower share of tanker water in the bulk water consumption volumes than the survey does (35–45% vs. 62–65%). A possible explanation for this is our method of distributing commercial agents across Amman, which creates a large number of establishments in densely populated areas with a longer duration of network supply. While this approach of linking commercial populations to the existing residential data was plausible, it ignores the fact that certain urban districts are more relevant for tourism, commerce and shopping. This might affect the results of the simulation model to some extent, since the geographic location is a relevant factor in determining how much water is consumed from which source. To assess whether the survey or the simulation model is closer to reality in this regard, a better understanding of the geographic distribution of commercial establishments in Amman is required. A third possible method for the analysis of the commercial use of tanker water could be the development of a spatial-econometric model. This approach would complement our simulation and the surveys and should therefore be explored in future research. All three options would profit from the availability of reliable data on the commercial sector in Amman.
The results we obtained are limited by the use of simplifying assumptions. With regard to model design, it could be argued that for potential future versions it is necessary to reassess in depth the applicability of the assumption that network water is allocated before tanker water. Particularly in locations close to a well cluster, the tanker water prices are below the cost for network water, which implies that at least as long as the cheap water from the vicinity is available, commercial users might consume tanker water before they open the tap. As mentioned before, however, the concept of transaction cost can be used to argue in favor of our assumption. Additionally, simultaneous allocations of network and tanker water would increase the complexity of the model significantly and would also require a reassessment of the calculation of welfare, which considers network water as the first consumed good under the demand curve.
Apart from the time sequence of the allocations, we have treated water from all sources, including groundwater from different wells, as a homogeneous good. In reality, different applications of water from different sources can be observed: (perceived) water quality often is the decisive factor when choosing a source for a specific activity such as water for drinking and cooking, other indoor uses like cleaning and washing or outdoor uses such as irrigating [11
]. Most of these existing observations, however, apply to household
water use. It is thus necessary to gain a deeper understanding to which extent commercial water consumers differentiate between water from different sources. At this point in time, we had to rely on the aforementioned assumption that water from all sources is pumped into the same storage tank and is therefore treated the same. Future research could be aimed at investigating heterogeneity of water as a good and input for commercial activities, which also opens further room for improvement of the model: depending on the availability of more data, the introduction and use of storage
as a factor could enrich the model, which is so far merely considering storage size in the calculation of water demand. Yet, establishments with a large storage capacity and good access to network water would potentially behave differently if the option to store was included in the model.
Notwithstanding the constraints discussed above, we have developed a model with a high degree of spatial differentiation that has produced the first estimate of the water consumption of the commercial sector in Amman and shed some light on how the tanker water market functions. While other approaches from the economic theory, notably general equilibrium models, are increasingly addressing issues such as water scarcity and supply intermittency (e.g., [38
]), we have provided an example of how agent-based modeling can be used to improve our understanding of behavior in complex water supply systems shaped by a variety of small-scale providers.
This paper aimed to carry out a positive analysis of commercial water consumption in Amman. Our simulation model revealed that tanker water provision is highly relevant for the commercial sector in Amman, arguably more than for residential consumers. The analysis further showed that the differences in network supply durations and the spatial dispersion of groundwater wells influence water allocation considerably. Establishments in advantageous locations can incur tanker prices lower than the network tariff, especially in winter. The west of the city, however, is far-off from (documented) groundwater wells, which turns tanker water into a comparatively expensive alternative to the network.
While a sustainable urban water supply system might look different from the one prevalent in Amman, it cannot be dismissed that tanker operators perform a currently indispensable service. This paper did not aim to conclude which share of Jordan’s groundwater should be allocated where. Policies aiming at the reduction of groundwater draft for tanker water sales, however, should consider that these contribute significantly to commercial welfare by balancing the inadequacies of the network system. Thus, reductions in tanker water availability might impact value creation in the commercial sector adversely, which is the main source of employment and tax income in the Governorate Amman.
The previous paragraph also points at a questionable premise in the approach towards tanker water common in the literature: tanker water provision is frequently compared with a network water system with continuous supply at low tariffs and thus framed as a problem. While such a water supply system may be considered desirable, it does not seem to be a realistic prospect in Amman within the near future, i.e., the real is compared to an ideal situation. We argue that tanker water markets and their potential alternatives should be evaluated carefully and based on evidence before conclusions on their desirability in urban water supply systems are drawn. The same consideration can be transferred to welfare statements (e.g., [16
]): when compared with the same amount of water from the network under the current tariff, large parts of tanker water consumption can be framed as a welfare loss. If however, one assumes that tanker water cannot be replaced in the short run, it contributes
While we took a first step towards comprehending the processes underlying commercial water consumption in Amman and explored how tanker water pumped for the commercial sector might be related to groundwater management, our analysis revealed significant data gaps and starting points for future research. It could for instance be worthwhile to assess whether our model could be adapted to evaluate the effects of policy measures aiming at prices or available water volumes. For this, the results presented in this paper could serve as a baseline to measure the impacts of policies on groundwater sustainability and on the welfare of the commercial sector. Further, in-depth studies on tanker water consumption can contribute information to difficult decision-making processes concerning trade-offs between securing water needs, while moving towards a more sustainable use of freshwater.