Water Quality in the greater Rotterdam area // Episode 2 - Problem Definition Part.2

1.3 System Tensions 

Paradoxical tensions are understood as tensions resulting from coexisting, interrelated yet conflicting elements on a system, organization or individual level (Gaim & Wåhlin, 2015). Within the context of the grand challenge of water security in the Greater Rotterdam area, several paradoxical tensions can be identified.

1.3.1. Price vs Quality

The price and quality of water are both highly important to the guarantee of safe, affordable water. Unfortunately, it is difficult to prioritize both elements simultaneously. Aside from the price rise due to grand challenges such as climate change, other market-related factors also play a role. While drinking water is a public good and drinking water companies are state-owned, these companies can still make a profit, which is then returned to the government through dividends (Jorritsma, 2022). The profits are limited by the weighted average cost of capital (WACC), which is set at 4.3% for 2025-2027 (Ministerie van Infrastructuur en Waterstaat, 2024a). Thus, while profits are limited, they are still of interest to the drinking water companies. This creates a temporal tension when simultaneously trying to ensure the safety of drinking water (Hahn et al., 2014). As previously mentioned, the drinking water in the Netherlands does not meet EU standards, and improving the quality would require financial investments, in turn raising the price of water for consumers on top of the steadily increasing prices. 

1.3.2. Infrastructural Importance vs Short-term Profits

With a rising population on the one hand increased pollution of water and more severe droughts on the other, infrastructure needs to be adapted to produce sufficient drinkable water. However, extending water infrastructure requires large investments, thereby damaging the short-term profitability of the water company (Evides, 2024c). To be able to keep meeting demand in the future, Evides might be forced to look at other water sources besides groundwater. Besides the fact that investing in an infrastructure that collects river- or seawater is highly expensive, it would also end up being a system that might not succeed (Van Der Plicht, 2024). Therefore, a temporal tension arises between infrastructural importance and short-term profits. With this trade-off, Evides faces the problem that the most optimal solution in the short haul is not necessarily the same as the most optimal one when looking at the future (Hahn et al., 2014). This is because, in the interest of short-term profits it would probably be better for Evides to withhold from investing in infrastructure, but the company might be forced to adapt to ensure water availability in the long run.

1.3.3. Agricultural and industrial activity vs Water purity

In the agricultural sector, businesses are increasingly making use of pesticides and fertilizers to keep up with food demand due to population growth and to ensure that the crops are plague-free. Yet, these pesticides and fertilizers have damaging effects on water purity and thereby on the well-being of consumers and aquatic animals. Consequently, agricultural activity may endanger the availability of safe drinking water in the case of pesticide usage (AbuQamar et al., 2024). Similarly, within the industrial sector, many different chemical substances (PFAS) are used in the production process. For example, the company Chemours was criticized heavily for the shocking amounts of PFOA released during the production process of products such as pans. PFOA, a specific type of PFAS, is a very toxic substance which endangers public health (NOS, 2023b). Therefore, a spatial tension is present between agricultural and industrial activity and water purity (Hahn et al., 2014). 

1.3.4. Water availability vs water quality

The demand for clean water is expected to rise nationally by 100 million litres in 2030 compared to 1.4 billion litres in 2020. Water companies are currently extracting water at the maximum permitted rate, and struggle to fill their reserves. If water demand spikes, water companies will not have enough reserves to meet that demand (Van Leerdam et al., 2023). A temporal tension can arise if Evides is forced to choose between prioritizing the availability or the quality of water (Hahn et al., 2014). With the limited profits Evides is allowed to make, they must decide whether their investments go towards ensuring the supply of water can meet the rising demand or ensuring the quality of water remains acceptable. Evides must find methods to improve both the availability of water and the quality of water without having the costs trickle down to the consumer. 

That's the end of this episode, please feel free to commence a conversation as this episode is slightly more complex than the first one. As you noticed, this episode takes a systems perspective to explain paradox tensions that define the water security grand challenge, something that require some deep discussion to be fully understood and appreciated :)