A Cost–Benefit Analysis of Reclaimed Water and Desalinated Seawater for Irrigation in Axarquia, Southern Spain

In water-scarce regions, policymakers resort to reclaimed water (RW) and desalinated seawater (DSW) to supply economic agents when conventional resources are not available. This paper develops a proposal for a simple methodology to apply a cost–benefit analysis (CBA) approach to RW and DSW as a support to the evaluation of water policy goals. To test the method, it applies a CBA to RW and DSW in Axarquia (southern Spain), a water-scarce region suffering a long and extreme drought that is impacting urban supply and the agricultural sector. The benefit-to-cost ratio (BCR) of 17.02 estimated for reclaimed water highlights its high return on investment, suggesting that it offers substantial economic and environmental benefits. This high BCR indicates that reclaimed water as a resource for irrigation is highly cost-effective, particularly if it is combined with nutrient management. By contrast, the estimated BCR of 4.05 for desalinated water, although positive, is considerably lower, suggesting that desalinated water is a feasible but less cost-effective solution due to its high energy requirements and associated costs. This methodology may be extended to other hydrological systems, such as aquifer basins, to promote the generation of more comprehensive insights.