Renewable Desalination in Southeast Queensland

8/8/2019 Renewable Desalination in Southeast Queensland

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The Economic Aspect of Implementing Small-Scale Desalination

in South East Queensland1

Chris Bennett

Targeted Research Project, Stanford University in Australia 2008

Center for Marine Studies, University of Queensland

Professor Ron Johnstone

1 This study is a partner study to The Social Aspect of Implementing Small-ScaleDesalination in South East Queensland, Walker, W. 2008

Center for Marine Studies, Autumn 2008


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2. Abstract:

South East Queensland is a water-sensitive region susceptible to extreme drought;water infrastructure is already under stress from development and conservative

predictions show that water supply will be greatly outpaced by demand in thecoming years. One solution that would supply abundant, high quality, locally usablewater is desalination, a cost-competitive technology used worldwide and inAustralia on the large scale. Yet neither academic literature nor the Queenslandgovernment has investigated the economic appropriateness of this technology inSouth East Queensland at the small-scale level; this study evaluates the potentialuser market for desalination via a pilot survey of residents divided into two cohorts,residents from North Stradbroke Island and the Brisbane area. Using generalknowledge and choice preference questions, we examine the relationship betweenlocal water economy and willingness to use or pay for desalination services andhypothesize that a more stressed water economy will enhance openness todesalination. We found significant reported differences in the water economy thatcorrelate to the higher water stress in the Brisbane area; nearly 25% of respondentsfrom Brisbane compared to none from Stradbroke report to be effected by drought75-100% of the time, and 66% of respondents from Stradbroke report they areeffected 0-25% of the time. However, in violation of the hypothesis these differencesin the user market do not translate to a difference in openness between the twolocations, as willingness to purchase desalinated services is not significantlydifferent in either cohort. The most significant implication of this is that increasingwater stress in the future may not immediately enhance the economic viability ofsmall-scale desalination. More immediately, we conclude that although drought iscurrently having an unambiguous effect on the water market (amongst allrespondents nearly 75% currently use an alternative source of water), this does nottranslate to a sufficient openness to allow implementation of small-scaledesalination at the moment. Although more than half of all respondents wouldpurchase a desalination unit, 100% of respondents are not willing to pay anythingclose to the current price ranges of either conventional or renewable desalinationunits. Our pilot survey results were very significantly confounded by a small cohortand sample size (n=19 respondents), untested questions which lead to bias andskewed results, and unrepresentative and less than random sampling. Despite theseflaws, the preliminary results and literature and industry review suggest that at themoment, small-scale desalination is not economically implementable; a large-scale

mail-based survey should investigate choice preferences on a broader scale to getmore accurate results, and should focus on cheaper community based desalinationsystem costs. In addition, future research could examine policy design and potentialprivate-sector technological advances that would help to bridge the substantial gulfbetween citizens economic constraints and desalination costs.

3. Background and Research Focus:



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3.1 Climate and Water Supply in Queensland now and in the future, with a focus on

North Stradbroke Island and Brisbane

3.1.1 Climate Data and ENSO Variability

As of January 2007, South East Queensland (SEQ) sat at an accumulated rainfall

deficit of nearly 1400 mm.2This deficit is a larger part of a pattern of strong El-Ninoevents (longer, more intense drought than usual) and weak La Nina events (weakerrainfall than usual) that has transpired since 2001. Although 2008 has been therainiest year since 1999 at 1060 mm year-to-date, this is still only 150 mm aboveaverage, so SEQ still sits in a significant deficit.3 In fact, as visible in Figure 1, thecurrent rainfall deficit has no comparison in the 20th century besides that of thenotorious 8-year long Federation Drought from April 1898- April 1903.4

2 SEQ Drought as of 2007, 13 http://www.weatherzone.com.au/qld/brisbane/brisbane4 SEQ Drought as of 2007, 2



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Significantly, there is evidence that this is not just a blip on the screen, but part ofmore concerning long-term drying trend. Trends in total annual rainfall havedecreased somewhere from -20% to -40% depending on the part of SEQ, while from1900-2006, there is no significant downward trend.5 This is largely explained by theincrease in sea temperatures in the Southern Pacific Ocean that is in turn increasing

the frequency and severity of ENSO events. At least in the short-term, it isconcerning exactly when the next severe El Nino even will strike; the 2005 and 2007events were relatively mild, and it is not since 2002 that a significant event hashappened. Taken together, these short-term trends and risks as well as the specterof a more significant drying trend require a substantial risk management response.As the Queensland Government suggests, it is imperative we properly adapt our

5 SEQ Drought as of 2007, 6


Figure 1: SEQDrought2001-2007


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infrastructure and land uses to this environment.6

3.1.2 Current and Future SEQ Water Infrastructure and Water Economy in theBrisbane Area and North Stradbroke Island

SEQ possesses a highly dynamic water grid that harnesses surface water, primarily

from dams, as well as groundwater; a visual depiction of this can be found in Figure6 in Appendix 1. The primary bulk sources of water supply include water from theTraveston, Six Mile Creek, Wivenhoe and other dams far to the north, and especiallyrelevant to this paper, groundwater from North Stradbroke is a significant source asis visible in Figure 10.7Although it is beyond the scope of this paper to describe thisinfrastructure in any more detail, the bulk supply and transport scheme involves thedistribution of water by both State and Local governments in a complicated schemeinvolving more than 25 entities with transport and treatment assets.8 Thisconvoluted scheme results in fragmented ownership of local supply and differentwater prices at different areas. Given this lack of consistency, in this study the localwater supply of both the greater Brisbane Area as well as of North Stradbroke Islandwill be described briefly as they are significantly different.

Brisbane is currently experiencing significant water stress, as the Australian NaturalResource Administration places Brisbane within 70-100% of developed waterpotential.9Since July 31 2008, Brisbane has been under High or Level 5 waterrestrictions, which require each person to use less than 170 liters/day, and actualuse has hovered below that. In addition to Brisbane city proper this applies toIpswich City, Gold Coast City Council, and other surrounding local regional councils.Brisbane has subsidies in place to encourage alternative water sources, such as the$900-$1150 subsidy for the installation of a rainwater catchment. Brisbanes watereconomy exhibits a substantial yearly connection fee (around $150 AUD) and then a

tariff structure that varies between $0.59 and $1.12 AUD/m3 depending on annualuse amount.10 On North Stradbroke Island, however, water stress is much lesssignificant because of the huge groundwater stores on the island, which may yield amaximum potential use of 100,000 ML/yr. According to ANRA, extraction in 2004-2005 was 11,290 ML of a potential 30,000 ML, only 28%.11 Accordingly, waterrestrictions are more lax; prior to restrictions use was at around 300 L/day perperson, while it is currently just under Level 2 restrictions of 270 L/day.12 Waterpricing is different in Stradbroke; the base charge is more expensive at $200, andthe pricing varies between $1.28 and $1.96 AUD/m3 based on a dailytariff structurefor level of use. This more expensive rate reflects Redlands move to full-waterpricing after the Queensland Water Commission purchased the islands water

6 SEQ Drought to 2007, 77 Urban Water Supply Arrangements in SEQ, 278 Urban Water Supply Arrangements in SEQ, 89 Brisbane Area GMU10 Brisbane Local Government11 Stradbroke Regional Water Resource Assessment GMU12 Redland Shire Council



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resources.13 At average use levels, a Brisbane customer will pay around $1.12/m3,and an average Stradbroke resident around $1.28/m3 AUD. These local values differfrom national averages; in The Price of Water- Trends in OECD Countries, theOECD reports that per capita water use in Australia hovers around 250 L/day, whilethe average price of water in Australia in 1999 was $ 1.63 USD.14

It is exceedingly difficult to quantify exactly how water demand will increase andhow that will effect pricing, but the Australian government has done somepredictions based on modeling expected growth against current resources. InStradbroke, by 2020 water demand from the rest of the Shire alone will haveincreased to 30,000 ML, and additional water demand from the Stradbrokepopulation will likely have increased past the 2,000 ML currently used locally.15Thisdemand will put stress on the sustainable groundwater yield of 30,000 ML, althoughthe amount of use is far below the islands total water resources. By 2050, however,that total sustainable limit may be reached. In Brisbane, things are much more dire;in 2010 there will be 156177 ML allocated and a projected actual demand of

195,708 (see Figure 7, Appendix for details). This gap increases even moresignificantly in 2026 and to 80 gigaliters/annum by 2041.16 In fact, this trend is inplay across all of South East Queensland; as is visible in Figure 2, at currentallocation unchecked demand will outstrip supply by 2012, and even at full waterresource allocation over-sustainable yield will be reached by 2025.17

3.2: A Brief Survey of the Desalination Industry andEconomy

13 Redland Shire Council14 OECD, 1815 ANRA, Regional Water Resource Assessment16 Dennien, 517 Dennien, 2


Figure 2: ProjectedDemand and Supply forSEQ Water


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Given the current state of water stress and the prospect of water supply greatlyoutpacing supply in the coming decade, SEQ will have to find another source ofwater to increase that supply. There are several options but few provide a source ofrelatively permanent, high-quality, local water in the way desalination does. As theAmerican Water Works Association explains:

As Demand for Drinking water outstrips fresh potable water supplies in anarea, desalting brackish and other saline water may provide an attractivealternative or supplemental water supply. Furthermore, as regulatory andpublic health issues drive finished water quality goals to increasingly higherstandards, desalting technologies, developed for seawater and brackishsources, become options for improving water quality.18

The remainder of this background section will examine the context of the currentdesalination industry.

3.2.1 State of the Industry- Existing Technologies and Worldwide Capacity

Desalination was patented in 1870 and has been around throughout the 20th centuryin extremely arid areas. As Stewart Smith explains in Desalination, Waste Water,and the Sydney Metropolitan Water Plan, the current global capacity of alldesalination plants is approximately 23 million cubic meters (1 m3 =1000 L).19 Thiscomprises over 17,000 desalination plants in 120 countries. Significantly, thiscapacity is expected to double by 2015. 20There are three general categories ofconventional desalting technologies: thermal process which use heat to purify watersuch as multi stage flash and vapor compression; the mechanical process of reverseosmosis in which you generate pressure higher than the osmotic pressure of asolution to purify it through a membrane; finally, electrical processes such as

electrodialysis which pushes salts through a membrane using electrical potential.21

Because reverse osmosis is currently the cheapest of these processes, it makes upthe majority of global capacity and will continue to make up an even greaterproportion in the future.22 Alternative processes include solar stills, humidificationprocesses, and cogeneration systems that use thermal and conventional processes(also referred to as membrane distillation.)23Lucio Rizzuti explains that solar stillscan provide up to 6 L/m2/day, cogeneration plants allow for large production butrequire significant solar energy, and humidification units produce at 2 L/m2/day.24

In Australia, desalination has been around for decades as it has found application insome of Australias remote desert and island locations. In Desalination- A Survey of

Australian Plants, authors Herbert and Moffatt outline the 26 plants already in use in18 Water Desalting Planning Guide for Utilities, 119 Smith, 1220 Smith, 1221 Smith, 1322 Smith, 1323 Introduction to Desalination in Australia, 524 Rizutti, 12



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Figure 3: Cost Curves for PV and Conventional RO Systems

Systems using renewable energy, most often reverse osmosis systems hooked up to

Photovoltaic panels (PV/RO), demonstrate the same trends but simply track at ahigher cost. In Solar Desalination for the 21stCentury, G. Papadakis observes that:

For large renewable plants, the cost [of desalinated water] is roughly 1.3USD/m3. For smaller plants powered by renewables, the cost varies from1.95 to 6.5 USD/m3, while for very small stand-alone plants the cost isusually reported to be above 6.5 USD/m3. Recently, a value of 4.5 USD/m3was reported for a PV driven RO plant of a production of 2.2 m3/day(Mohamed 2005).31

These trends are partially visible in Figure 3, which compares the previouslydiscussed conventional desalination cost ranges to those of PV/RO systems. Thecurve continues at higher capacities; especially large renewable plants in Australia,such as the Kurnell plant in Sydney that buys renewable certificates, are currentlyoperating at a competitive cost of $1.44 AUD/m3 ($0.93 USD/m3).32 On the otherend of the spectrum, prices of $4.5-6.5/m3 at very small scales are not cost-competitive, but at this level the metric is not as meaningful; in view of reliabilityissues, savings in power costs, and reduction in PV module prices, small-scalerenewable systems may be well-suited in many situations.33

At these very small scales, capital costs often become the most important constraint.Because these prices vary based on location and company, the prices and discussionthat follows is based entirely off of industry data and case studies rather than

literature. Industry data from Citor revealed that a 2 m3/day unit costs $12,000,with a slightly higher production value of 5 m3/day costing $15,500.34 Slightlylarger units that may be appropriate for a very small community or resort varied

31 Rizzuti, 30132 Smith, 933 Fiorenza, 4034 Citor



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between 18-35 m3/day production and had respective costs of $45,000 and$70,000 AUD. Small-scale renewable desalination units were a tad harder to get aquote on, but Tinox advertises a 1000 L/Day humidification unit combined with a1.2 kW PV panel for $16,000. On a more medium-scale, the case study of the Mt.Coot-Tah botanical gardens in Brisbane is informative. The gardens used to ship in

large quantities of recycled water, but due to rising costs they installed an innovatesolar-powered reverse osmosis system which produces sustainable water for thesite and treats its own brine through the design of salt-water evapo-transpirationbeds (see Appendix 1, Figure 9 for pictures of the unit). The overall installation costincluding engineering and construction was $427,000; the networked RO systemfrom Aqueous Solutions was $60,000, and the Grundfos GF80 solar panels usingMPPT cost $80,000.35 This range of prices for both stand-alone and networkedsystems, both conventional and renewable, gives a representative baseline for thecurrent cost constraints in the desalination market.

3.3: Research Aims and Hypothesis of Our Pilot Project

3.3.1 Context via the Literature and Systems Analysis

Large-scale desalination is widely discussed in the technical and industry literature(Koschikowski et al 2003; Bouruoni et al 2000); however, the small-scaleapplications of desalination are rarely discussed. The only real sources of data on itspotential application come from industry data. However, there is reason to believethat small scale, decentralized resource production may be the most sustainable andcost-effective way to provide for water resources. In Evaluating the Costs ofDesalination and Water Transport, Zhou and Tol examine the role of transportationcosts on water price:

The main response to water scarcity has been to increase the supply bytransporting water from places where it is abundant to places where it is scarce.At a smaller scale, and without a lot of public and political attention, people havestarted to tap into the sheer limitless resource of desalinated water.36

In their research, the find that although transport costs can vary anywhere from afew cents to a dollar per m3, transport can make desalinated water prohibitivelyexpensive if any type of change in altitude is required, as in away from or towards acoastal environment. They cite Kally (1993) who averages out that the transport of100 million m3 of water/year over 200 km adds $0.21/m3 to the price of thewater.37Clearly, this is a significant addition, and with desalinated water already

only marginally cost-competitive, local desalination may provide a moreeconomically sustainable option, to say nothing of the security and environmentalresponsiveness that comes will local control of resources.

35 EIRT, Mt. Coot-tah36 Zhou et al 2004, 137 Zhoe et al 2004, 11



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Within the context of decentralized desalination, there is a conspicuous lack ofliterature or past social science research into the potential user market fordesalination, that is, the economic and social views and preferences that citizenshold towards potential future technologies. A systems analysis of desalination thatbreaks down the essential elements relevant to implementation can be found in

Figure 4. The initial implementation will require an estimation of several keyparameters- what scale it is at, what will power it, which local factors it must besuitable to, and how future maintenance and adaptability may affect feasibility. Butthe user market, the cluster of social and economic knowledge, perceptions, andconstraints that inform citizens decisions on or payment for a new service ortechnology, is arguably the most important element and is rarely investigated.

Figure 4: Systems Analysis View of Desalination

In Desalination, Wastewater, and the Sydney Metropolitan Water Plan, StewartSmith describes one of the few studies in the past that sought to evaluate the usermarket for a technology in the water sector was a survey done in July 2005, prior to

the decision to go ahead with a large-scale desalination plant, whether or not to userecycled wastewater as a source of potable water instead. The survey had a samplesize of 600 people and asked people to rate their comfort with drinking wastewateron a scale from very comfortable to very uncomfortable. The surveys result, that68% were uncomfortable, was published in The Sydney Morning Heraldandinfluenced the decision not to go ahead with the wastewater proposal.38 Especiallyrelevant to this paper, the survey also found that 65% of people supported the use

38 Smith, 10



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of desalinated water.

3.3.2 Social Profile of the Two Cohort Locations

In addition to the relevant differences in water economy and supply betweenBrisbane and North Stradbroke, there are relevant differences in social context andstructure between the two locations; here we briefly examine median age, income,education, population, and occupation. A social profile (Figure 5) of the two cohortlocations reveals a few salient differences.39

Figure 5: Social Profile of Cohorts

Cohort: Brisbane N. Stradbroke

Median Age 35 43Median Income ($/week) $516 $316Median Education Level Year 12 Year 12

Total Population 1,764,132 2,196Employment by Occupation Service Industries Trade Workers

3.3.3 Hypothesis

The purpose of dividing the pilot survey data into two geographic pools or cohorts isto examine the relationship, if any, between local water economy and supply issuesand increased willingness to purchase or pay for desalination in homes orcommunities. My hypothesis is that if the water economy is more threatened bydrought, the user market will be more open to desalination. In general, choice

preference questions can gauge this level of openness as well as other economicbarriers to implementation.

4. Survey Methods

4.1 Pilot survey design

We carried out a small pilot survey on North Stradbroke Island, Queensland overthe course of two days. Our survey method involved approaching random people atpublic places in three locations, at Point Lookout, on the Point Lookout beaches, and

at Dunwich, and asking them if they would mind participating in a brief confidentialsurvey before handing them the 3-page questionnaire to fill out. The sample sizeafter two days was n=19. The only personal information we collected about therespondents was their place of residence so we could place them in a cohort.

4.2 Structure and contents of survey

39 Australia 2006 Census Data



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Our survey consisted of 13 total questions. The first five questions describe therespondents current water economy; the first two questions related to the watersupply, and the next three to the reliability and quality of that water supply. Thenext four questions discuss desalination in general and seek to gauge theperceptions, knowledge, and comfort of the respondent towards the technology.

After a preface about future water problems and scarcity increasing, the respondentis then asked four choice modeling or stated preference type questions. Thesequestions evaluate whether the respondent would be willing to purchase adesalination unit, how much she would be willing to pay for different types, and howthat decision may be effected by a subsidy. Although these types of questions aretricky to design and interpret, they are useful in that they can estimate benefits andcosts that currently are not in the market and the associated preferences for futurestrategies.40Therefore, they can explore the user market in ways that otherwisecould not be ascertained. All questions in the survey had the respondent circle theoption that fits their opinion best with the exception of the question that requiredrespondents to estimate their billed water usage/day.

5. Survey Results

5.1 Results from questions assessing the current the water economy

In this question, we asked respondents to estimate their daily household usage (inother words, estimate what their daily water bill usage would read). Brisbaneresidents responded with a mean of 290 L/day, while North Stradbroke residentsreported a mean of 162.5 L/day. Despite very high variance (a standard deviation of220 for the Brisbane group), the two reported means are ostensibly different as theerror bars show. However, performing a t-test yields a value of 1.174 and a P value

40 Bennett 2005, 2



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of 0.28, so the difference is not significant and we accept the null hypothesis.

We asked respondents to quantify the extent to which the ongoing drought haseffected the quality and reliability of their water supply on a scale from 0-100%,with 100% being a constant, strong effect and 0% being no effect at all. Nearly 25%of respondents from Brisbane compared to none from Stradbroke report to beeffected by drought 75-100% of the time, and 66% of respondents from Stradbrokereport they are effected 0-25% of the time. The distribution between the cohorts issignificantly different, as the error bars on the 25-50% and 75-100% categoriesindicate. In a related question in the survey, 100% of Stradbroke residents reportedhigh satisfaction with service, while some Brisbane residents reported mid or low

satisfaction.

In this first question in the survey, we simply gauge whether or not respondents



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obtain an alternative source of water besides from the grid. The most significantsource of alternative water was bottled water, followed by water from a rainwatercatchment. Amongst all respondents, nearly 75% (14/19) currently use analternative source of water. Of those people who owned a rainwater catchment,75% were from Brisbane.

5.2 Choice Preference questions assessing openness to a potential desalination market

After providing background information about anticipated water scarcity andquality issues and telling the respondent to assume that a desalination unit couldprovide you a sustainable and cheaper water supply source in the future, we askwhether the respondent would be willing to pay for such a unit. At first look it seemsthat Brisbane residents may be more willing to purchase a desalinated unit, since

significantly more answered yes. However, this merely reflects the larger Brisbanecohort size. Proportionally, 61% of Brisbane residents would purchase a unit whilehalf of Stradbroke residents would, which is not a significant difference.



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This graph is displayed as the total pool of respondents because the two cohortswere almost uniform. Of the 13 respondents willing to pay, the majority (8/13)would not pay more than the bottom price range of $1000-$5000 for a small in-home unit, while the others would pay slightly more. Not one respondent answeredin the highest cost range bracket. The results for WTP for a solar desalination unit

were almost identical. Besides the slightly higher cost ranges to reflect the cost ofsolar panels and the fact that one more person (9/13) chose to pay in the lowestcost bracket of 4000-8000 instead of in the 8000-12000 bracket, the data showedthe exact same distribution. Also not shown is the graph for the final choicepreference question, which assessed the extent to which a subsidy would affect thepersons likelihood to purchase. There is no significant trend between the cohorts;83% of Stradbroke residents were somewhat effected while Brisbane residents hadthe most respondents unaffected and greatly affected. As one would expect, nearly80% of the total pool of respondents reported they would be at least somewhatmore willing to purchase a unit.

6. Discussion

6.1 Evaluating the Trends and Hypothesis

First, in the background it was clearly established that across the board, SEQ isalready experiencing water stress. The results indicate that the drought is clearlyaffecting the user market; 12/19 respondents report that the drought effects aquarter or more of the quality of their water service, and 14/19 respondentscurrently use some form of alternative water. The data shows an unambiguous

trend here.

Brisbane and N. Stradbroke Island have different water economies, with Brisbanesmore exposed to water stress. Brisbane has a slightly lower price for water butsubstantially more restrictions on water use and programs to encourage waterawareness and alternative sources. The results from reported water use andperception of drought show at least some significant differences in the user marketfor water between N. Stradbroke Island and Brisbane. As noted in the results, thereis a substantially different distribution between the respondents perceptions ofdrought in the two locations, with Brisbane residents reporting higher droughteffect, and perceived satisfaction and reliability is also higher on Stradbroke. These

trends jive with the intuitive fact that Brisbane residents would be more affected bydrought because they are forced to lower their level of water use. Brisbane residentsreport more use of water than Stradbroke residents, although this is not significantbecause of high variance. This result is puzzling, however, since local governmentreports that Brisbane is currently using just under its restriction of 170 L/Day andStradbroke users are using nearly 100 L/Day more. There are three possibleexplanations: first, the question methodology is flawed and so the results aremeaningless (this will be discussed later); second the means are not representative;



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or third, Brisbane users have a tendency to overestimate use while Stradbrokeresidents have a tendency to underestimate because of water awareness. Somecombination of the first two explanations seems more likely than the third. In anycase, the data shows that Brisbanes water economy is more threatened by drought.

The choice model questions, as visible in the results section, illustrate thatwillingness to pay is strongly clustered in the lowest cost range across the data forboth conventional and renewable power small-scale desalination units. This issignificant is exposing a large economic cost impediment at the moment to theimplementation of small-scale desalination. The median cost range for conventionaldesalination, $1000-$5000, is around $10000 below the actual cost of such a unit atthe present time as estimated with industry data (Citor). The median cost range fora renewable desalination from $4,000-$8,000 is again around $10000 below theactual cost of such a unit (Tinox). The significance here is that regardless of thespecific technology there is a relatively constant $10000 price gap between industryand the cost constraints in the market, and that 100% of respondents willingness to

pay estimations fell below the actual cost of such a technology at the moment. Thefinal choice model question, whether or not a subsidy would encourage purchase,did not show any significant relationships between the cohorts or in general. But itdid show most respondents would be somewhat more willing, which is important toconsider given the current cost gap.

In evaluating the hypothesis, the only test we have available from the data is thechoice model question on willingness to purchase since that is the only question thatdisplayed a variation between cohorts. As discussed in the results section, 61% ofBrisbane residents would be willing to purchase and 50% of Stradbroke residentswould be willing to purchase, which is not significant. This contravenes thehypothesis and implies that increasing water stress does not immediately open upthe user market to desalination, at least in the economic sense. This result forces usat least for now to expect the null hypothesis that there is no positive correlationbetween increasing stress and economic openness to desalination. However, eventhis should be viewed skeptically; the result also violates what would expect fromthe social and economic context of the two cohorts; the social profile (Figure 5)reveals that Brisbane residents have higher income which we would expect mightincrease their willingness to purchase and the amount they would be willing to pay,and are also more knowledgeable and comfortable with desalination as a technology(see W. Walker, 2008).

6.2 Flaws and Error in Methodology

First, there were abundant flaws in the sample size and representativeness of ourdata. After two days, our size was n=19, however this means that our means areprobably enormously skewed. Therefore, our extremely small sample size goeshand in hand with wholly representative data, which casts doubt on the accuracy ofall of our means. The second immediate effect this had on the data was establishingpoor cohorts, both in individual as well as in relative size. The size of our Brisbanecohort at n=13 was more than twice as high as the Stradbroke cohort at n=6. This



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made comparisons unrepresentative and especially in the case of the Stradbrokedata again increased the proliferation of error.

Second, there are a host of issues relating to poor survey methodology, both in theway the survey was written and in the way we collected data. The way we collecteddata tended to proliferate error in that we approached specific subsets of thepopulation who happened to be in public, either beach and at other tourist locations.This meant the process wasnt random. The survey was written poorly, and that ledto systematic errors in some of our respondents answers. For example, we includedleading information before the willingness to pay questions, the choice preferencequestions had poorly designed (too low and too large) monetary ranges, thepresence of an open-ended question on water usage resulted in inaccurate data, andsome of the wording was unclear.

Third, there are potential problems relevant specifically to choice modeling that oursurvey design did not adequately account for and which shed doubt on all of ourwillingness to pay type questions. Small sample size proliferates error more so inchoice modeling type questions than in other types of questions. The QueenslandEPA recommends that any survey employing choice-modeling questions consist of asample size of 1000 or greater in order to cut down than the higher than usual errorlatent to these type of questions.41 M. Hanemann discusses an additional conceptualflaw with these types of questions; he argues there is a subtle difference betweenwillingness to pay and accept questions which effects the results one gets from thequestion. While our question on willingness to purchase may be consideredwillingness to accept since the respondent isnt required to think of a monetarycompensation, the other CP questions require the respondent to consider theimmediate cost, which means the results are probably not comparable.42As B.Jorgensen explains, there is also an issue of social psychology at play, andspecifically social guilt or moral satisfaction may cause the respondent to over-estimate how much she would be willing to pay. This in general lends to a significantunsystematic variability, which may increase error.43

Fourth, there are some relevant social and economic confounds that may effect theresults. As alluded to at the end of the discussion section, there are distinct levels ofknowledge of desalination in general and comfort towards the technology betweenthe two cohort locations (see W. Walker 2008). This, instead of backgroundeconomic and cost constraint issues, may influence the overall willingness topurchase a desalination unit; a significant confound and relates to whether or notthe hypothesis can even be tested by such a question accurately.

6.3 Future Directions

41 Bennett, 242 Hanemann, 343 Jorgensen et. al. 2004, 3



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The most immediate implication of this pilot study on a future research direction isto use the research focus and the design flaws identified to create a morecomprehensive survey to accurately evaluate the desalinations economic usermarket. The survey should include carefully designed CP questions, more questionson networked or community desalination focusing on willingness to pay for various

prices of water in $/m3, and should take place on a much larger scale via mail.Further, given the significance of the current cost gap for small-scale desalinationsimplementation and scalability, both government subsidies and promotion of theprivate sectors development of desalination technologies should be explored tohelp bridge that gap sooner, rather than later. Water is arguably South EastQueenslands most important resource, and acting ahead of time to guarantee itssupply in the future requires that we examine the feasibility of desalination now andinto the future.

7. References

"Assembled Units and Kits: Price List" Seawater Kit Desalinators. Citor Pty. Ltd. 26Nov. 2008 Orignally enquired at: .

"Available Rebates 2008/09" Services: Rainwater Tanks. Brisbane City Council. 11Dec. 2008.

Bennett, J. Choice Modeling: A Step-by-Step Guide. Economics Techniques Series:Fact Sheet No. 1. The Economics Branch, Policy Division, Queensland EPA.

April 2005Census Data. 8 Feb. 2006. Australian Bureau of Statistics. 3 Dec. 2008

Dennien, B. (2005). Delivering Brisbanes Water Services.Brisbane, Australia:Brisbane Water. [Powerpoint]

"Desalination in Queensland: Final Report" Urban Water Use Reports. Departmentof Natural Resources and Mines. 02 Dec. 2008.

"Emerging trends in desalination: A review " Waterlines report No 9 - October 2008.Australian Government: National Water Commission. 12 Dec. 2008

Environmental Infrastructure Research Program (EIRP): Mt. Coot-tha BotanicGardens Applicant 27. Australia. Queensland Government. Local Governmentand Planning. Brisbane City Council 1-8.



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Hanemann, W. Michael. "Willingness to Pay and Willingness to Accept: How MuchCan They Differ? " The American Economic Review 81.3 (1991): 635-647.

Herbert, L.S. , and D.H. Moffatt. Desalination- A Survey of Australian Plants.Australian Water Resources Council Research Project No. 68/6. Canberra:Department of National Development, 1970.

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Lucio, Rizzuti, Hisham M. Ettourney, and Andrea Cipollina. Solar Desalination for the21st Century: A Review of Modern Technologies and Researches onDesalination Coupled to Renewable Energies. Hammamet, Tunisia: Springer,2007.

"Queensland Water Resources Overview" Australian Government: AustralianNatural Resource Atlas. 10 Dec. 2008.

"Queensland Water Resources Overview" Groundwater Management Unit: NorthStradbroke Island. Australian Government: Australian Natural ResourceAtlas. 2 Dec. 2008.

Smith, Stewart. "Desalination, Waste Water, and the Sydney Metropolitan Water

Plan." Parliament of New South Wales Briefing Paper Vol. No. 10. (2005) 28Nov 2008.

Technical Data Sheet MiniSal 1000 System. Tinox Water Management. 9 Dec. 2008

The Water Desalting Committee of the American Water Works Association. WaterDesalting Planning Guide for Water Utilities. John Wiley and Sons, 2004.

The Price of Water: Trends in OECD Countries. Paris, France: Organization forEconomic Cooperation and Development, 1999.SEQ Drought to 2007

"Urban Water Supply Arrangements Report " Water Reform. 10 April 2008.Queensland Water Commission. 4 Dec. 2008.

"Water Efficiency and Restrictions" Water Efficiency Information. Brisbane City



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Council. 11 Dec. 2008.

"Water Fact Sheets" Council Service: Water and Waste. Redland Shire Council. 8 Dec.2008.

"Water and Sewerage Charges" Brisbane Water. Brisbane City Council. 11 Dec. 2008.

"Worst drought ever for Brisbane dam catchments" Forecasts: SEQ Drought. 14August 2007. Queensland Government: Natural Resources and Water. 11Dec. 2008.

Zhou, Yuan, and R. S. J Tol. "Evaluating the Costs of Desalination and Water

Transport" Water Resources Research 41 (2005). Brisbane Council Specific-Rainwater catchments and Price of Water

Appendix: Additional Figures



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Figure 6: Current SEQ Water Infrastructure



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Figure 7: Expected Brisbane Water Budget

Figure 8: Cost Curves for Conventional Desalination for different sources

Figure 9: Solar Panels and RO Unit at Mt. Coot-tah Botanical Gardens, Brisbane

Renewable Desalination in Southeast Queensland

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