Optimal Conjunctive Use of Groundwater and Recycled Wastewater

Inasmuch as water demand is multifaceted, infrastructure planning should be part of a general specification of efficient quantities and qualities of water deliveries over time. Accordingly, we develop a two-sector dynamic optimization model to solve for the optimal trajectories of groundwater extraction and water recycling. For the case of spatially increasing costs, recycled water serves as an intermediate resource in transition to the desalination steady state. For constant unit recycling cost, recycled wastewater eventually supplies non-potable users as a sector-specific backstop, while desalination supplements household groundwater in the steady state. In both cases, recycling water increases welfare by shifting demand away from the aquifer, thus delaying implementation of costly desalination. Implementation of the model provides guidance on the appropriate timing and size of backstop and recycling infrastructure as well as water deliveries from the various sources to the water-demand sectors.