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Towards sustainable urban water management: A critical reassessment David R. Marlow*, Magnus Moglia, Stephen Cook, David J. Beale CSIRO Land and Water, Graham Road, Highett, VIC 3190, Australia

article info

abstract

Article history:

Within the literature, concerns have been raised that centralised urban water systems are

Received 22 November 2012

maladapted to challenges associated with climate change, population growth and other

Received in revised form

socio-economic and environmental strains. This paper provides a critical assessment of

6 June 2013

the discourse that surrounds emerging approaches to urban water management and

Accepted 21 July 2013

infrastructure provision. As such, ‘sustainable urban water management’ (SUWM) concepts

Available online 20 October 2013

are scrutinized to highlight the limitations and strengths in the current lines of argument and point towards unaddressed complexities in the transformational agendas advocated

Keywords:

by SUWM proponents. Taking an explicit infrastructure view, it is shown that the specific

Sustainable urban water manage-

context of the urban water sector means that changes to infrastructure systems occur as

ment

an incremental hybridisation process. This process is driven by a range of factors including

Systems transitions

lock-in effects of legacy solutions, normative values and vested interests of agents, cost

Infrastructure management

and performance certainty and perceptions of risk. Different views of these factors help explain why transformational agendas have not achieved the change SUWM proponents call for and point to the need for a critical reassessment of the system effects and economics of alternative service provision models. Crown Copyright ª 2013 Published by Elsevier Ltd. All rights reserved.

1.

Introduction

Management of water is a critical factor in urban sustainability (Schaffer and Vollmer, 2010). In most modern cities, water services are delivered via networks of buried pipes that connect customers to treatment works and, ultimately, to sources of water and sinks for wastewater. This infrastructure represents a significant capital investment and future generations will inherit the outcomes of society’s ongoing investment decisions (Burn et al., 2012; Marlow et al., 2010a; Wong and Brown, 2009). The sector is facing increasing pressures associated with climate change, changes in population and demographics, a volatile global economy, increasing energy prices, heightened environmental awareness and more complex regulatory and social circumstances (Marlow et al., 2010b;

Werbeloff and Brown, 2011a,b). Local pressures vary considerably, but the reality is that water service providers (WSPs) must operate within constrained budgets, while being expected to deliver quality service at a low price. In such circumstances, it is particularly important to address the growing uncertainty with respect to operational, environmental, social and economic constraints (Blackmore and Plant, 2008; Pearson et al., 2009). Moreover, there is an increasing clash between the demand for and limits to resources that result in ecological, economic and cultural ‘strains’ (Vlachos and Braga, 2001). From an urban water perspective, these strains have led various authors to suggest that the current model of service provision is no longer appropriate (Pahl-Wostl, 2002; Ashley et al., 2003; Milly et al., 2008; Pearson et al., 2010; Brown et al., 2011).

* Corresponding author. Tel.: þ61 3 92526614. E-mail addresses: [email protected], [email protected] (D.R. Marlow). 0043-1354/$ e see front matter Crown Copyright ª 2013 Published by Elsevier Ltd. All rights reserved. http://dx.doi.org/10.1016/j.watres.2013.07.046

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The aspiration for change has been labelled in a variety of ways, but in this article is referred to as ‘sustainable urban water management’ or SUWM (Makropoulos et al., 2008; Brown and Farrelly, 2009; Novotny, 2009; Werbeloff and Brown, 2011a). SUWM concepts have been discussed and developed over a number of decades (Hengeveld and De Vocht, 1982; Button and Pearce, 1989; Choguill, 1993; Niemczynowicz, 1999; Hellstro¨m et al., 2000; Keath and Brown, 2009). However, while there has been some adoption of alternative approaches, the predominant model of service provision remains unchanged. Given the significant volume of papers advocating change, this article provides a critical review of SUWM concepts and seeks to illustrate why transformational agendas have not realised the mainstream adoption of SUWM approaches that proponents assert is needed. As the aim of this article is to provide a critical review of the SUWM paradigm rather than the literature itself, the presentation of arguments departs somewhat from the standard model of a review paper. The concept of SUWM is first considered via a comparison to current models of service provision. The purported benefits of SUWM and the impediments that must be overcome to achieve these are then outlined. Conceptual models of investment and option selection are then used to further investigate factors that are central to the debate over SUWM.

2.

Sustainable urban water management

The authors have previously delivered a body of research related to infrastructure asset management, integrated urban water management, decentralised solutions and sustainability within the urban water sector. A question that arose from this work is why SUWM concepts are so strongly supported in the academic literature, but still remain a niche innovation from the perspective of broader infrastructure provision. A critical review of the SUWM paradigm was thus undertaken. To this end, we identified relevant literature by searching academic databases using key words related to SUWM concepts. Additional literature relevant to the authors’ previous experience and research was also considered.

2.1.

A brief historical perspective

The traditional model of urban water service provision evolved through a number of phases, as explored by such authors as Tarr et al. (1984), Geels (2005), Gandy (2004, 2006) and Brown et al. (2009b). For the purposes of this paper, we have synthesised these phases in Table 1. According to the literature, the development of the associated socio-technical regime involved a co-evolution between science, technology, culture, industry structure, policy institutions and the market (Geels, 2005). SUWM concepts can be considered the next step in this co-evolution and reflect growing concerns over community wellbeing (rather than just public health), ecological health and sustainable development, all of which can be collectively labelled as ‘green’ issues (Bartone et al., 1994). Green issues and related policy developments reflect a growing awareness that the natural environment is vulnerable to human activity at multiple spatial and temporal scales (Fiorino, 2001). Arguments for SUWM are essentially an articulation of this awareness, expressed in terms of the urban water cycle. In practical terms, however, the space to consider SUWM arises primarily where the urban water sector is delivering secure, reliable and safe water services. In contrast, urban centres in developing countries are still grappling with what has been dubbed the ‘brown agenda’ (Allen et al., 2002), which relates to the impact of urban pollution on public health. From an urban water perspective, the immediate challenges in such countries remain the lack of access to safe water, sanitation and adequate drainage systems (Gandy, 2004).

2.2.

The meaning of ‘SUWM’

As an aspiration, SUWM reflects a generalised goal to manage the urban water cycle to produce more benefits than traditional approaches have delivered. While its meaning is not precisely definable, it is possible to characterise the concept through a comparison with a more traditional model of urban water management. The current dominant model relies on large-scale, centrally managed infrastructure systems that are designed to deliver cheap and reliable services (Brown et al.,

Table 1 e Stepwise development of urban water systems. Existing infrastructure Unstructured system, with some storm sewers in large cities Water pipes

Service focus

Driver for change

Basic services

Population growth and associated issues, especially pollution and inadequacy of local water supply

Piped water

Secure supply of wholesome water

Excessive demand placed on waste disposal system, leading to contamination of urban areas with stagnant water and faecal matter. The perception of disease being related to noxious smells was also a key driver. Contamination of surface waters with sewage and impact on health of downstream communities.

Sewers (combined and separate)

Water pipes and sewers Public health and (combined and separate) drainage (in larger cities) Water pipes, sewers and Waterway pollution Degradation of urban water ways, nuisance issues and loss of WTWs amenity value. Water pipes, sewers and WTWs, STWs

Solution

Flood protection and drainage

Extension of paved urban areas required extensive drainage systems

Water Treatment Works (WTWs) and protected catchments Sewage Treatment Works (STWs) and separation of sewers Extensive storm sewers

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2009a,b). Centralised provision and management of this infrastructure has been necessary because the systems are very costly and operations are complex and resource intensive. Potable water, wastewater and drainage services are generally delivered via a network of buried pipes. These pipes typically represent 50e75% of a WSP’s combined operating and capital costs (Thomas and McLeod, 1992; Speers, 2009). In theory at least, reducing the reliance on such networks has the potential to either realise a significant reduction in expenditure or to ensure that expenditure is focused on treating water, sewage and stormwater to suitable levels. Decentralisation is thus a key theme in the SUWM literature. Proponents for SUWM also note that water-carriage sewerage systems are wasteful resulting in significant loss of useful resources (nutrients, energy and water). Similarly, stormwater management purely for flood protection implies a useful resource (i.e., the conveyed water) is wasted. Furthermore, the discharge of stormwater to waterways leads to the disturbance of ecosystems. Proponents also note that only a relatively small percentage of potable water supplied to customers is actually used for potable purposes. This implies there are significant opportunities for reducing the cost of treating and transporting potable water. When commentating on alternatives, proponents of SUWM assert that a more integrated approach to water supply, sewerage and stormwater management has the potential to deliver the most appropriate use of water from all stages of the urban water cycle and therefore enhance social, ecological and economic sustainability at various scales (Ashley et al., 2003; Milly et al., 2008; Wong and Brown, 2008; Brown et al., 2011). It has also been suggested that the resilience of urban water systems will be improved through diversification away from a centralised model (Speers and Mitchell, 2000; Wong and Brown, 2008). SUWM thus differs from traditional models in its core aims, the type of infrastructure and how the urban water cycle is managed.

3. Benefits of SUWM and implications to infrastructure The perceived shortcomings of existing approaches to management of urban water have led various commentators to argue for a transition to a more sustainable approach (Niemczynowicz, 1999; Newman, 2001; Pahl-wostl, 2007; Brown et al., 2011; Urich et al., 2011; Binney, 2012). This has in turn led to the development of a range of concepts that underpin the overarching SUWM paradigm, including Integrated Urban Water Management (Coombes and Kuczera, 2002; Mitchell, 2006; Maheepala et al., 2010; Burn et al., 2012), Total Water Cycle Management (Chanan and Woods, 2006; Najia and Lustig, 2006; Grant et al., 2010) and Water Sensitive Urban Design (Wong, 2006; Yu et al., 2012). Despite the different terms used to describe SUWM, proponents tend to note three central benefits in comparison to traditional urban water management: (1) a more ‘natural’ water cycle; (2) enhanced water security through local source diversification and (3) resource efficiency. The adoption of decentralised infrastructure solutions is seen as a means of achieving these goals.

3.1.

A more ‘natural’ water cycle

Within the SUWM paradigm, the objectives for managing stormwater have broadened from mitigation of flood risk to encompass pollution control, ecological regeneration and enhancement of urban amenity and recreational value (Thomas et al., 1997). This involves implementing a range of decentralised solutions and the disconnection of waterways from impervious surfaces to ensure flow regimes are closer to ‘natural’ ones in terms of quality, quantity and frequency of flow, while still ameliorating flood risk (Mitchell, 2006; Walsh et al., 2005; Fletcher et al., 2007; Sharma et al., 2008b, 2009; Wong and Brown, 2008; Rozos and Makropoulos, 2012). The degree to which degraded urban waterways can be restored varies and the term ‘naturalization’ is sometimes used as an alternative to restoration. By definition, urban areas have been significantly altered from their pre-development state, so the goal of naturalization is to establish dynamically stable waterways capable of supporting healthy ecosystems (Rhoads et al., 1999).

3.2. Enhanced water security through local source diversification Within urban areas, there are many demands that can be met through water of non-potable quality, including landscape irrigation, industrial applications, groundwater recharge, recreational applications and surface water augmentation (Gikas and Tchobanoglous, 2009). Proponents for SUWM argue that developing alternative water sources within the urban catchment will allow these demands to be satisfied through the supply of water of a quality that is ‘fit for purpose’ (Newman, 2009). Alternative sources include rainwater harvesting, stormwater harvesting, water recycling and sewer mining (Thomas et al., 1997; Speers and Mitchell, 2000; Newman, 2001; Brown et al., 2008; Wong and Brown, 2008). Diversification using these alternative local water sources reduces the demand placed on water abstracted from waterways, groundwater or dams and thus improves water security (PMSEIC, 2007; Wong and Brown, 2008). Reducing the amount of water extracted from waterways also has the potential to contribute to the maintenance of environmental flows. Hence, water security has become a common theme in the SUWM literature (Novotny, 2009; Werbeloff and Brown, 2011b; Lloyd et al., 2012).

3.3.

Resource efficiency

Another potential benefit of SUWM is that it promotes efficient use of resources in line with broader interpretations of ‘sustainability’. It can be argued that resource efficiency is a goal of any effective water business, as it implies minimising the use of water, energy, process chemicals and other resources to reduce costs. Water conservation initiatives involving customers also provide benefits in terms of improved water security and resource efficiency (Howe et al., 2005; Inman and Jeffrey, 2006; Daigger, 2009; Gato-Trinidad et al., 2011). Proponents of SUWM assert that further resource efficiencies can be achieved by adopting an integrated approach to the urban water cycle (Thomas and

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McLeod, 1992; Wong, 2006; Gikas and Tchobanoglous, 2009; Speers, 2009). Expanding beyond these efficiencies, the concept of resource recovery is advocated to minimise the ecological footprint of the urban water sector (Burn et al., 2012). This involves reclaiming useful components of waste streams, including energy, nutrients and water.

3.4.

Decentralised solutions

The term ‘decentralised’ is often applied to solutions that are complementary to the existing centralised system (Gikas and Tchobanoglous, 2009). Such solutions can be matched to the local context in terms of water sources and demands, as well as environment and social factors (Cook et al., 2009; Gikas and Tchobanoglous, 2009; Sharma et al., 2010). Stated reasons for adopting decentralised solutions include a desire to promote innovation and technology, striving for more efficient use of resources, improving landscape amenity, contributing to community well-being and protecting the natural environment (Kennedy et al., 2007; Biggs et al., 2009; Tjandraatmadja et al., 2009; Daniels and Porter, 2011; Hall, 2012). Decentralised solutions may also help defer augmentation of existing infrastructure. For example, traditional water and wastewater pipe network design is driven to a large extent by the need to cater for peak demands. Mitigation of these peaks through use of decentralised solutions, including provision of local capacitance, can allow deferral of investment and produce substantial reductions in capital costs (Speers and Mitchell, 2000).

4.

Impediments to change

Despite the claimed benefits of SUWM, transformational agendas have not achieved the level of change called for by its proponents. For example, Wong and Brown (2008) state that adoption of SUWM solutions remains too slow and that investment in conventional approaches perpetuates a significant delay in the widespread uptake of alternatives. Brown et al. (2009a,b) similarly questioned the dominant government responses to extended drought in Australia, which largely involved the expansion of centralised systems, including large investments in desalination. Keath and Brown (2009) noted that the reaction to extreme drought events also led to investment in traditional solutions, suggesting that this response over-rode emerging values associated with SUWM. Farrelly and Brown (2011) stated that governments continue to promote large scale technological solutions, rather than supporting emerging and existing sustainable technologies and practices. Part of the challenge in changing the model of service provision is that investment cycles for infrastructure often occur over timescales that are too short (e.g. five years) to allow effective adaptation to longer term pressures (de Graaf and van Der Brugge, 2010). Another challenge is that the widespread adoption of a specific technological solution leads to both institutional and technological ‘lock-in’ effects (Foxon et al., 2002). Arthur (1994) identified four factors that generate such effects: (1) economies of scale, (2) learning effects that improve products or reduce their cost, (3) adaptive

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expectations (agents become increasingly confident about quality and performance of the current technology) and (4) network economies (agents adopting the same technologies as others). Lock-in effects can create a barrier to the adoption of more sustainable technologies (Foxon et al., 2002). Proponents of SUWM argue that since legacy infrastructure is long lived and expensive it locks out innovative alternatives. Brown et al. (2011) have in fact referred to this as ‘entrapment’, which would imply that traditional models of service provision are demonstrably inferior. There are, however, a number of conceptual weaknesses associated with the arguments for SUWM and these provide alternative insights into why transformational agendas remain unfulfilled. We illustrate these by couching them in terms of four key issues: (1) difficulties in predicting the system effects of innovative solutions, (2) practical challenges in managing innovations in technologies and service provision strategies, (3) financial considerations and (4) the effect of bias and advocacy on the promotion of technologies and management paradigms.

4.1.

Predicting system effects of innovations

The performance of an urban water system is multi-faceted and difficult to predict from a system perspective. While this can be said of traditional systems, innovative solutions are, by definition, introduced into new contexts, which implies there will be a lack of institutional capacity to manage uncertainties and risk. Changes to any part the system can have both upstream and downstream impacts that affect costs, performance and future opportunities (Speers and Mitchell, 2000). This leads to dynamic changes across multiple temporal and spatial scales that are often not intuitive even to experts. Lack of knowledge or uncertainty may also mean that an attempt to achieve one SUWM objective undermines the achievement of another. For example, in some cases the energy intensity required to pump a unit of water from a local water source like rain tanks compares unfavourably to the energy associated with centralised water pumping (Tjandraatmadja et al., 2012). Similarly, Rygaard et al. (2011) noted that while options such as recycled water, desalination and rainwater collection can improve water security, their introduction raises several challenges; e.g. energy requirements vary by more than a factor of ten amongst the alternative techniques and wastewater reclamation can lead to the appearance of trace contaminants in potable water. The effectiveness of SUWM options also depend on a number of highly context specific factors (Naylor et al., 2012; Rozos and Makropoulos, 2012). For example, Moglia et al. (2012b) considered the operation and maintenance requirements for rainwater tanks, and concluded that they depend on underlying socio-psychological factors and overarching governance arrangements. The contribution of alternative solutions to SUWM objectives can also be over estimated. For instance, rainwater tanks in South East Queensland (Australia) were installed on the basis that they would reduce demand for mains water through substitution (Walton and Holmes, 2011). Mandatory building provisions specified a 70 kL/year annual reduction in mains water demand per new dwelling, but less than 70% of this target was achieved (Beal et al., 2012).

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Historical perspectives of the water sector have shown that innovations that appeared to promise only benefits produced significant secondary costs (Tarr et al., 1984). Similarly, SUWM solutions have sometimes resulted in unintended and undesirable consequences (Kennedy et al., 2007). For example, in one stormwater harvesting scheme in Melbourne, Australia, thousands of birds were attracted to the constructed wetlands causing issues such as droppings, odour and especially noise (Melbourne Water (MW), 2012). Reduced water consumption can also have impacts on the sedimentation and degradation processes in sewer systems and may impact wastewater treatment efficiencies (Parkinson et al., 2005; Marleni et al., 2012). Kennedy et al. (2007) described unintended consequences of SUWM solutions in two urban regeneration projects that involved inconvenience, distress and health and safety risks of end-users. Overall, these issues highlight the need for rigorous assessment of alternative service options against multiple criteria (Lundin and Morrison, 2002; Zarghami, 2005; Willetts et al., 2007; Ashley et al., 2008; Zarghami et al., 2008; Sharma et al., 2008a, 2009; Moglia et al., 2012a). However, even when applying suitable decision support methods, a considerable amount of uncertainty remains because innovative technologies and solutions are less tried and tested (Moglia et al., 2012a). While such issues are expected as part of a necessary learning process (Moglia et al., 2010; 2011a; Farrelly and Brown, 2011; Bos and Brown, 2012), broader experimentation in new technologies still needs to be undertaken in a way that does not significantly impact customers (Rittell and Webber, 1973). As less evidence is available for novel solutions, the responsible approach is to proceed on the basis of experimentation, pilot studies and trials that allow an empirical foundation for change to be developed (Farrelly and Brown, 2011).

4.2. Practical challenges in the management of innovative solutions As well as difficulties in predicting the performance and system effects of innovations, there are also adoption issues to address, including increased management complexity, diffuse responsibilities, uncertain performance and community resistance to change. More specifically, innovative solutions often have requirements that are not necessarily clear from the outset, and institutional capacity therefore tends to develop over time (Bos and Brown, 2012; Moglia et al., 2012b; Naylor et al., 2012; Yu et al., 2012). For example, Backhaus et al. (2012) indicated that stormwater harvesting needs to be supported by research and knowledge gathering, industry wide communication of existing knowledge and collaboration between various types of practitioners. Depending on the governance arrangements, the staffing, management difficulties and skill requirements vary considerably (Naylor et al., 2012). Changes to the potable water system can also meet significant resistance from the public (Hurlimann and Dolnicar, 2010). A number of researchers have highlighted the complexities involved with obtaining community acceptance of alternative water solutions (Hurlimann and McKay, 2004; Marks and Zadaroznyj, 2005; Marks, 2006; Dolnicar and Hurlimann, 2009; Nancarrow et al., 2009; Hurlimann and Dolnicar, 2010). Various factors contribute to this, including

risk perception, trust in the WSP, perceptions of fairness, perceived outcomes and personal values (Mankad and Tapsuwan, 2010; Nancarrow et al., 2010; Mankad, 2012). There are also concerns relating to end-user involvement in ˚ berg, 2002; Gardiner management of systems (So¨derberg and A et al., 2008). Post-implementation surveys have indicated the importance of on-going engagement with end-users of decentralised water systems, due to the possibility of unintended consequences, even when they are not directly involved with their management (Dahan and Nisan, 2007; Hochmuth et al., 2012; Kennedy et al., 2007; Moglia et al., 2011b).

4.3.

Financial implications

WSP revenues are to some extent often linked to the volume of potable water used by customers, so widespread implementation of alternative water sources and/or water conservation measures could lead to reduced revenues (Mitchell et al., 2007). Properties connected to centralised infrastructure also pay standing charges to cover the capital cost of the infrastructure. This is a significant component of customer bills, so decreasing the reliance on centralised water provision would therefore not necessarily be reflected in a significant cost saving to the community, which reduces incentives for uptake of SUWM options. This is particularly problematic if traditional water systems remain the “systems of last resort” (i.e. are needed to supply water services when SUWM options fail, there is prolonged drought or a need to supply water for fire fighting, etc.) such that there are no reductions in system sizing. Consideration of externalities has the potential for capturing the additional benefits of SUWM options (Hatton MacDonald, 2004; Listowski et al., 2013; Tjandraatmadja et al., 2005). The challenge is to value externalities in a way that is rigorous and reflects community values, and then to set appropriate tariffs to achieve the best outcome for the community whilst maintaining the financial viability and sustainability of WSPs (Mitchell et al., 2007; Singh et al., 2007).

4.4.

Institutional and personal bias

When businesses, authorities, universities and related organizations build up knowledge and experience with any particular solution, it is inevitable that they will develop biases, intentionally or otherwise, towards their own commercial or institutional interests (Rygaard et al., 2011). Such biases can interfere with the judgment of proponents for any technology, who may over-estimate the benefits of their preferred solutions and under-estimate potential problems in comparison to alternatives. While such biases are observed in those who promote centralised solutions, these issues are particularly important for SUWM due to the values held by proponents, as described in the remainder of this article.

5. Conceptual models of change within the water sector Factors that influence the rate of progress towards SUWM can be illustrated further by considering how innovations are

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Fig. 1 e A Systems Perspective of Water Sector Investments. The flow of urban water investment accumulates over time as a capital stock of constructed and natural infrastructure assets that contribute to the delivery of urban water services. The level of investment is influenced by a ‘hard’ metric-driven feedback loop, which along with consideration of endogenous and exogenous pressures informs the need for future investment. There is, however, also a ‘soft’ opinion-driven feedback loop that reflects the perception of broader outcomes delivered by the sector. Perceptions are influenced by complex issues related to vested interests and values.

taken up within the water sector. Relevant conceptual models have been previously discussed in terms of a multi-layer perspective (MLP) model (Geels, 2005a; Van Der Brugge et al., 2005; Geels and Kemp, 2007). The MLP model is concerned with what can be referred to as ‘system transitions’, which are specifically defined as far-reaching changes in both the technical and social/cultural dimensions of a system (Van Der Brugge et al., 2005). According to Elzen and Wieczorek (2005), this co-evolutionary aspect distinguishes a ‘transition’ from incremental technical improvements where there is relatively little alteration of the societal embedding of the technologies. As illustrated throughout this article, the literature on SUWM implies there is a need for radical co-evolutionary change in the approach to urban water management and infrastructure provision, and Brown et al. (2009b) explicitly considered SUWM in terms of this type of transition. From an infrastructure perspective and considering the urban water sector of developed countries as a whole, it seems unlikely that a broad transition to an alternative model of service provision will be economically or practicably feasible because many of the decisions made in the past are now, in practice, irreversible. For example, buried pipe assets have life spans of many decades, even centuries, and deteriorate in response to many factors. As such, similar assets can come to the end of their life at very different times (WERF, 2009; Burn et al., 2010). This allows rehabilitation of these assets to be distributed over time, which reduces peaks in investment and capital works. However, this also means that infrastructure is subject to incremental replacement such that existing

systems are renewed in a piecemeal way. This has the cumulative effect of perpetuating the same type of centralised infrastructure systems into the future. As a result, the capacity to operate, maintain and renew such systems must also be retained irrespective of greater use of SUWM solutions, which has flow-on implications to the funding and skills needed to support urban water systems into the future. At a local scheme level, innovations in infrastructure provision and management do occur, but in relation to the majority system these are ‘add-ons’. From an infrastructure perspective, rather than a radical transition, the process of change is thus better conceptualised as one of a gradual change, wherein there is an introduction of innovative solutions into a stable system based on legacy technologies. We term this gradual evolution ‘system hybridization’. Opportunities for system hybridisation arise whenever an investment is made, but in practice SUWM innovations are often considered when existing infrastructure has insufficient capacity or would need to be extended, and the cost of doing this would be prohibitive (Balslev Nielsen and Elle, 2000). This can occur when there is development at the urban fringe, such that existing networks would need to be extended, or when growth within an urban area means infrastructure capacity needs to be augmented, but this is expensive or technically difficult. Factors that influence the hybridisation process can be illustrated with reference to two coupled conceptual models developed as part of this review. The first helps to elucidate why proponents of SUWM consider that progress towards change is not rapid enough, whereas the second

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indicates factors that influence innovation uptake, which are linked to the impediments discussed above and in combination drive system hybridisation.

5.1.

Investment and capital accumulation

Fig. 1 illustrates how the flow of investment (ref. 1 in Fig. 1) into an urban water system accumulates as a capital stock of constructed and natural assets (ref. 2) that has the capacity to deliver services to both the community and the environment. The condition of the asset stock is reduced over time due to asset deterioration (ref. 3), which is counterbalanced by capital maintenance (i.e. investment to replace assets at the end of their life). Investment is also required to cater for exogenous influences such as climate change and population growth (ref. 4). As shown, the asset stock provides a flow of services (ref. 5) that in turn contribute to broader triple bottom line (TBL) outcomes (ref. 6) such as public health, community wellbeing, environmental health and economic production in other sectors, etc. Notionally at least, all these stocks and flows can be considered to have economic value, and could thus be expressed in monetary terms, as implied in Fig. 1. The level of investment is subject to a range of constraints and efficiencies. Shortfalls can be managed to a certain extent through improved management and maintenance practices, but ultimately the infrastructure places bounds on the level of service that can be delivered consistently. For the purposes of this discussion, there are two feedback loops that influence the flow of investment and thus the maintenance and augmentation of the asset stock and its capacity to provide service. Firstly, from an infrastructure asset management perspective, systems are managed in light of service and performance targets. Hence, a ‘hard’ or metric-driven feedback loop exists wherein measures of asset condition, performance and service inform the need for future investment (ref. 7). Secondly, the system is subject to a ‘soft’ or opiniondriven feedback loop that reflects the perceptions of various stakeholder groups (customers, regulators, suppliers, politicians, academics, etc.) with respect to the contribution the water sector makes to broader outcomes (ref. 8). These perceptions vary according to the responsibilities and interests of each stakeholder group and are influenced by vested interests and normative values. For example, individuals and institutions with responsibility for, or interest in, waterway health and sustainability will have different perspectives to, say, an economic regulator driven by the requirement to maintain ‘efficiency’ from the perspective of customer bills. Where groups or individuals consider that the outcomes of water sector investments are inadequate (as in the case of advocates for SUWM), this translates into a demand for change in the way investments are justified and/or the type of solutions funded, as evidenced in the SUWM literature. The difference between these two feedback loops is important for understanding why proponents of SUWM consider insufficient progress is being made. At a fundamental level, proponents are expressing opinions based on their own values and, to some degree at least, their vested interests. Values are an integral aspect of all decision making in that any decision reduces to a choice between alternatives of what is most valued (Sperry, 1977). However, proponents of SUWM

hold values that are not necessarily representative of broader community aspirations. Certainly, willingness to pay surveys carried out by WSPs in the UK have indicated that communities are becoming more reluctant to fund additional environmental improvements (WERF, 2013). This can be explained by recognising that historical investments were made in response to highly visible issues such as water borne disease, aesthetic impacts and pollution. Solving these problems provided benefits that were obvious to communities. In contrast, the issues targeted by SUWM are somewhat less tangible from the perspective of the broader community, though personal engagement with the underlying values will vary depending on socio-economic, demographic and other factors. Since it is the broader community who must pay for the necessary changes, the arguments for additional investments or alternative solutions are more difficult to make, especially were customers are used to receiving reliable services and public health and environmental benefits at relatively low cost.

5.2.

Option identification and assessment

The stocks and flows model of investment shown in Fig. 1 shows how perceptions can lead to a call for change in investment that is not implied by formal asset management feedback loops, and thus provides insights into why proponents consider progress towards SUWM is too slow. The other relevant process relates to how options are identified and considered for implementation. A key aspect in any investment decision is to identify feasible solutions. In this context, ‘feasible’ implies infrastructure (or other) options that are able to provide service (or other outputs) over an economic life. We refer to the ‘option space’ as that sub-set of solutions that is seriously considered for implementation. Various factors influence the option space. These are shown in Fig. 2, grouped in terms of ‘actors’, ‘technology’ and ‘drivers’. The combined influence of the individual factors defines the option space

Fig. 2 e Factors Influencing the Option Space Considered. A key aspect in any investment decision is to identify feasible solutions. Various factors related to ‘actors’, ‘technology’ and ‘drivers’ influence the option space considered. These factors are dynamic and interact with one another. The perspectives and attitudes of the actors involved are a key determinant in how the option space is defined.

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considered for a particular investment or scheme. It is noteworthy that many of these factors also influence stakeholder perception of investment needs, as shown in Fig. 1, which provides a coupling between the two conceptual models. The perspectives and attitudes of the actors involved are a key determinant in how the option space is defined. In this context, actors are taken to be the individuals or teams making the decision over which technology/solution to select. The options considered by these actors will reflect vested interests and normative values. However, other stakeholders with different values and interests will judge both the options considered and the solution ultimately selected from their own perspective. The implication is that both the agents making the decision and those commentating on it can have different opinions that reflect their own vested interests and values, as exemplified by comments proponents for SUWM have made with respect to continued investments in centralised solutions. These differences in opinion are compounded by the fact that a controversial knowledge base allows different lines of argument to be made in support of different perspectives (Pahl-Wostl, 2002). As well as values and vested interests, the issue of risk perception is critical to understanding different perspectives of option selection. Decision makers are, by definition, responsible for selecting the solution implemented, and thus are exposed to risks associated with making a poor choice. In contrast, while advocates for innovative options may have an informed view of the technical and broader issues and even a stake in the outcome, they are not making the decision and will thus have a different risk perception (the decision making risks are born by others) and a different frame of reference (Lems et al., 2011). This has significant implications to commentary over the willingness to innovate. For example, Farrelly and Brown (2011) have stated that the continued use of large scale technological solutions reflects a ‘reticence’ to go beyond pilot trials, which is taken to be representative of both the ‘fear of failure’ of actors and inherent conservatism, especially with respect to public health risks. Noting that Fig. 2 includes performance and cost certainty as key factors that influence the option space, an alternative view is that many innovative solutions remain unproven and have low community acceptance, as described earlier. From this perspective, any ‘conservatism’ could then be considered as an appropriate assessment of this uncertainty, especially given that funds are not unlimited and that community preferences must be considered (Speers, 2009). The continued use of traditional solutions would then be seen as a rational decision based on a pragmatic assessment of available options.

6.

Conclusion

A significant body of work within the academic literature asserts that that the current model of urban water service provision needs to change. The aspiration for change is referred to in this paper as ‘sustainable urban water management’ (SUWM). SUWM reflects a generalised goal to manage the urban water cycle so as to produce more benefits than traditional approaches. Despite ongoing calls for change, the predominant model of service provision remains the same

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approach that is considered by commentators to be ‘unsustainable’. With this in mind, this paper has provided a critical reassessment of the SUWM paradigm, which was undertaken specifically to examine why transformational agendas have not realised the change proponents imply is needed. It has been shown that a range of factors mean that the process of change within the water sector occurs as a gradual process, which we term ‘system hybridisation’. The incremental nature of this process, the need to retain capacity to manage legacy infrastructure and the clash between values, expectations and interpretation of opportunities is central to the fact that the transition to SUWM has not occurred in the way advocated in the literature. In particular, in comparison to the community more generally, the adoption of values associated with SUWM concepts is stronger within the niche group of individuals contributing to the SUWM literature, and this informs the implicit assessment of cost and benefits that underpins their call for change. Advocacy for a change in community expectations and values is a matter of choice for any individual, but mixing such advocacy with arguments for specific technical solutions, as is done in some of the literature reviewed, is potentially problematic because of the possibility that benefits of proposed solutions will be overstated and risks understated. Furthermore, making value-based rather than evidence-based arguments could lead to polarized positions, wherein agents with responsibility for ensuring due diligence in how community funds are spent (e.g. economic regulators) impede innovation. While it has its risks, advocacy for SUWM does provide a driver for experimentation and infrastructure diversification. However, this is counterbalanced by perceptions of certainty/ uncertainty and the perception/exposure to risk of decision makers. Overcoming these issues implies gaining a better understanding of life cycle performance, costs, risks and benefits of specific SUWM innovations and broader system effects. Evidence should be presented, as far as is practicable, in a way that is free of cognitive and other biases. There is also a need to develop core competencies necessary to manage innovations and build the institutional capacity to manage risk. In practice, this implies the type of experimentation that has been undertaken to date, but this has resulted in slower progress than proponents of SUWM consider necessary. From a purely economic perspective, the benefit of altering the system should outweigh costs. It is currently left as an implicit assumption in some arguments for SUWM that the benefits derived from transforming to a new model of service provision will exceed the costs. Whether or not this is actually the case depends on how benefits and costs are defined. Given that investments are made on behalf of communities, the ‘social business case’ for change needs further testing in terms of all relevant cost and benefits, including externalities, with due consideration given to community willingness to pay and other relevant perspectives, including maintenance of ecosystem services. In particular, since many of the benefits of SUWM are non-market (i.e. the intangible components of total economic value) and somewhat nebulous from the perspective of communities, the value placed on them requires further research (Daniels and Porter, 2011; Marlow et al., 2011). Overall, the challenge for proponents of SUWM remains the need to provide valid economic assessments of alternative

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options, considering social equity, the aggregate whole life costs of modified systems and the benefits these will deliver when compared to competing demands for community investments. Even with all this information, given the lock-in effects of legacy solutions, it seems likely that the process of change will continue as a system hybridisation. This will mean that SUWM solutions are added to legacy systems that are perpetuated into the future through like-for-like replacement. With that in mind, we conclude that transformational agendas will continue to fall short of the expectations of SUWM proponents, though their advocacy will remain a driver for the hybridisation process.

Acknowledgements The authors gratefully acknowledge the financial support of the National Flagship Water for a Healthy Country (CSIRO). In addition, the authors acknowledge the role of reviewers for helpful and detailed comments on the initial draft of this paper.

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Towards sustainable urban water management: a critical reassessment.

Within the literature, concerns have been raised that centralised urban water systems are maladapted to challenges associated with climate change, pop...
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