population. Table 4 presents the major conclusions of the studies by Balali et al. (2008) and
Balali and Montashloo (2014). Both studies rely
on mathematical programming in their analysis
and projections. Moreover, Balali et al. (2008)
specifically consider the effects on the local
population’s incomes.
Both of the studies present a number of scenarios with different assumptions, from which we
pick three of the most relevant ones for the topic
of this chapter (Table 4). They are based on the
assumptions of small, medium, and large electricity subsidies cuts. Interestingly, Balali et al.
(2008) find that with small price increases of
50%, water consumption reduction will be very
minor (just above 3%), but the income losses will
be considerable (15.7%). In contrast, nearly tripling electricity and doubling diesel prices will
have dramatic consequences for the rural economy as incomes were projected to drop by 85%.
Table 4 Previous studies on energy prices dependent on groundwater extraction
General
Paper
Balali et al. (2008)
Balali and Montashloo (2014)
General
information of
the studies
Data year
2008
2012–2013
Model
Dynamic mathematical programming
with tube-bath model of aquifer
Mathematical programming
Crops
Multi-crop condition
Multi-crop condition
Region
Hamadan-Bahar Plain
Garveh-Kordestan
Energy type
Electricity and diesel
Electricity and diesel
Scenario
Structure
8 scenarios of energy price increases for
1 to 5 years periods are compared to the
baseline scenario, no technological
change assumptions for irrigation are
made
8 scenarios of sudden increases in
energy prices compared to a baseline
scenario, technological change
assumptions for irrigation are made for
5 scenarios
Scenarios from the two studies relevant for our discussion
Scenario 1:
“Small price
increase”
Energy price
increase
Annual increase in energy price for
5 years: 50% electricity and diesel
10–20% increase in energy price with
no technological change
Groundwater
consumption
decrease
5 years period: 3.04%
0.15%
Gross income
decrease
5 years period: 15.7%
–
Scenario 2:
“Intermediate
price
increase”
Energy price
increase
Annual increase in energy price for
5 years: 125% electricity and 67%
diesel
50% increase in energy price with no
technological change
Groundwater
consumption
decrease
5 year period: 31.9%
2.04%
Gross income
decrease
5 year period: 53.7%
–
Scenario 3:
“Large price
increase”
Energy price
increase
Annual increase in energy price for
5 years: 286% electricity and 211%
diesel
–
Groundwater
consumption
decrease
5 year period: 55.4%
–
Gross income
decrease
5 year period: 85%
–
The Energy-Water Nexus in Iran …
115
Balali and Montashloo (2014). Both studies rely
on mathematical programming in their analysis
and projections. Moreover, Balali et al. (2008)
specifically consider the effects on the local
population’s incomes.
Both of the studies present a number of scenarios with different assumptions, from which we
pick three of the most relevant ones for the topic
of this chapter (Table 4). They are based on the
assumptions of small, medium, and large electricity subsidies cuts. Interestingly, Balali et al.
(2008) find that with small price increases of
50%, water consumption reduction will be very
minor (just above 3%), but the income losses will
be considerable (15.7%). In contrast, nearly tripling electricity and doubling diesel prices will
have dramatic consequences for the rural economy as incomes were projected to drop by 85%.
Table 4 Previous studies on energy prices dependent on groundwater extraction
General
Paper
Balali et al. (2008)
Balali and Montashloo (2014)
General
information of
the studies
Data year
2008
2012–2013
Model
Dynamic mathematical programming
with tube-bath model of aquifer
Mathematical programming
Crops
Multi-crop condition
Multi-crop condition
Region
Hamadan-Bahar Plain
Garveh-Kordestan
Energy type
Electricity and diesel
Electricity and diesel
Scenario
Structure
8 scenarios of energy price increases for
1 to 5 years periods are compared to the
baseline scenario, no technological
change assumptions for irrigation are
made
8 scenarios of sudden increases in
energy prices compared to a baseline
scenario, technological change
assumptions for irrigation are made for
5 scenarios
Scenarios from the two studies relevant for our discussion
Scenario 1:
“Small price
increase”
Energy price
increase
Annual increase in energy price for
5 years: 50% electricity and diesel
10–20% increase in energy price with
no technological change
Groundwater
consumption
decrease
5 years period: 3.04%
0.15%
Gross income
decrease
5 years period: 15.7%
–
Scenario 2:
“Intermediate
price
increase”
Energy price
increase
Annual increase in energy price for
5 years: 125% electricity and 67%
diesel
50% increase in energy price with no
technological change
Groundwater
consumption
decrease
5 year period: 31.9%
2.04%
Gross income
decrease
5 year period: 53.7%
–
Scenario 3:
“Large price
increase”
Energy price
increase
Annual increase in energy price for
5 years: 286% electricity and 211%
diesel
–
Groundwater
consumption
decrease
5 year period: 55.4%
–
Gross income
decrease
5 year period: 85%
–
The Energy-Water Nexus in Iran …
115