Achieving sustainable irrigation development in agricultural areas of Serbia with limited water resources

Abstract

Irrigation has contributed significantly to poverty alleviation and food security; however, the sustainability of irrigated agriculture is being questioned both economically and environmentally. Agriculture is the economic sector where most water is consumed, but the lowest price is practised. This article presents an interdisciplinary approach to selecting and prioritizing infrastructure, by differentiating water sources for irrigation, in the case of two complex irrigation systems. Comparative analysis was undertaken for major hydrological, hydraulic, hydrotechnical and economic parameters in order to estimate a long-term water supply for irrigation. In the case of complex irrigation water supply systems, differentiating the ‘subsystems’ per water source and allowing their separate development require less investment and give a better chance for the project implementation. The average calculated investments in basic irrigation infrastructure were in a wide range, from EUR3327 to 10,103 ha⁻¹, depending on anticipated water source (impoundments, groundwater and rivers). Economic water price also varied widely, EUR0.09–0.30 m⁻³, depending on the water source for irrigation.

Keywords

complex irrigation system water management investment costs water pricing decision support planning

Introduction

Extreme climate events foreseen by IPCC (2007) climate scenario will often bring occurrence of severe drought and heavy precipitation, followed by flood, which will certainly affect several economic sectors. Extreme climate events already challenge the existing water supply systems. Urban growth accompanied by inadequate planning of water systems is linked to a substantial risk of a water crisis. Water scarcity is expected to be a major constraint for sustainable development, not just of the arid and semi-arid regions but also of temperate climate regions (Rey et al., 2016). One example is the Fucino Plain in central Italy, where rising demand of population, industry and irrigated agriculture initiated depletion of water sources and consequently socio-economic problems (Frank et al., 2008). In the future, it will become challenging to supply the general population with water, let alone large consumers, such as agriculture.

Agriculture is a significant user of water resources in Europe accounting for 30% withdrawal (FAO, 1997; Massarutto, 2003) and reaching 70% of global water withdrawal (Calzadilla et al., 2010; FAO, 2004; Rey et al., 2016). Irrigation affects the environment largely through exhaustion of water resources (Wriedt et al., 2009), which reflects the change in the flow regime of rivers or groundwater depletion (Dougherty and Hall, 1995). Irrigation development may influence an increase in total water requirements, and consequently, it can result in seasonal pressure on water resources in the future. Therefore, analysing water storage capacity is a basis for irrigation development planning. When considering large-scale irrigation systems, the integrated use of surface water and groundwater is necessary for optimal utilization of water resources.

Irrigation has contributed significantly to poverty alleviation, food security and improvement in the quality of life of the rural population (FAO, 1997). However, the sustainability of irrigated agriculture is being questioned both economically and environmentally (FAO, 1997). Irrigation development entails large investment in irrigation infrastructure, which has to be justified through economic benefits (Ortiz and Ramirez, 2010). Assessment of economic effects of irrigation that precedes the construction is based on data that result from predesign activities, so the advancements in designing and analysis methods allow accurate outputs (Potkonjak et al., 2007; Potkonjak et al., 2013; Potkonjak and Zoranovic, 2012). If the capacity of the water intake is not properly assessed and/or the irrigation infrastructure is undersized, the performance of the system will not satisfy the needs of users and will not mitigate the effects of dry weather. Water shortage affects not only agricultural production but also the farmers’ ability to pay for water-related services. To avoid this downward loop, it is necessary to develop designs based on a feasibility study and perform predesign activities (field investigations, hydrological calculations and modelling and the estimation of water resources capacity). Furthermore, postdesign activities are required for the success of a project, such as to teach farmers to grow high-value crops and how to use water rationally (Hosni et al., 2014), to make an economically justified system.

Investments in irrigation infrastructure, as well as irrigation water price, may vary widely, depending on the geographic location, soil, crop pattern, agroclimate, water sources, technical requirements and institutional arrangements (Giannakis et al., 2016; Ortiz and Ramirez, 2010; Wichelns, 2010). Tsur (2005) pointed out that pricing became the central means for water demand management. Generally, agriculture is the economic sector where most of the water is consumed, but the lowest price is practised (Noeme and Fragoso, 2004). Economic aspects of irrigation in many regions of Mediterranean Europe were reassessed with respect to European policy ‘payment by users’ (Noeme and Fragoso, 2004). This policy considers that farm revenues cover the public investments and operating costs of irrigation infrastructure.

The challenging task is how to make irrigation more affordable, but at the same time to find a balance between economic and environmental sustainability. This article presents an interdisciplinary approach to selecting and prioritizing infrastructure, by differentiating water sources for irrigation, in the case of two complex irrigation systems. Major hydrological, hydraulic, hydrotechnical and economic parameters were analysed at observed locations to estimate long-term water supply for irrigation. The aim of this study is to highlight the necessity for thorough irrigation planning, including socio-economic analyses to achieve sustainability of the system. The irrigation system is sustainable only when it is able to close the supply–demand balance and reduce environmental and social problems with a positive cost–benefit balance.

Materials and methods

The study was divided into the following sections:

The technical section includes defining a typical crop pattern, quantifying the irrigation water requirements under current climate conditions, estimating the potential of available water resources, and developing solutions for water supply to demand sites.

The economic section includes estimating total investment in irrigation development and pricing irrigation water, that is, analyses that will determine the expected economic performance for the suggested project.

Study area

Two locations (municipalities) with long agricultural tradition and increased interest for irrigation were chosen for such analyses: Velika Plana and Leskovac (Figure 1). During the period 1989–2000, the average drop in crop yield was 40.9% in Eastern Serbia, in comparison with the average annual yield in the years without drought (UNW-DPC, 2013). The situation is similar in other parts of Serbia, including selected locations. Bearing in mind the projected increase in air temperature and a decrease in precipitation, agricultural production will become very vulnerable to climate change in the future.

Figure 1.

Location of target areas (municipalities) in the Republic of Serbia.

Velika Plana is a typical rural municipality with almost 80% of agricultural land, located in Central Serbia. According to the Spatial Plan of Velika Plana Municipality 2012–2022, total agricultural land will amount to 219.86 km². The main characteristics of the Velika Plana’s territory are moderate climate, fertile soil, mostly agricultural land and a great potential for organic agriculture. The territory is vertically divided into two parts: hilly western zone (100–297 metres above sea level (MASL)) and eastern lowland along the Velika Morava River (80–100 MASL). In addition, each zone is divided into the southern and northern parts, by the natural flow of the river Jasenica. The first impression is that there is abundance of water available for irrigation and other purposes, which was subjected to a thorough analysis. Availability of water for irrigation (water balance) is estimated using planning documents, existing monitoring results and research, which we refer to in the “Results” section.

The area of Leskovac city is 1.020 km², which is divided by rivers and smaller watercourses into several agricultural ‘entities’. Leskovacko Polje, the central ‘entity’ of the area, covers about 56 km². Leskovacko Polje has a good general position, soil and agricultural tradition and potential.

Current irrigation practice in Velika Plana and Leskovac is best described by data collected in the agricultural census in 2012. Total irrigated area in the agricultural year 2011/2012 in Velika Plana covered 829 ha of utilized agricultural land (4.3%) and in Leskovac 2939 ha (9.6%). The farmers mainly apply surface irrigation, and as the main source of water for irrigation, a large majority declared groundwater at holdings (Table 1). The farmers who grow vegetables, melons and strawberries are most concerned with irrigation. Currently, the interest in irrigation is growing, particularly in parts where water is less available, but the conditions are suitable for the cultivation of high-value crops, for example, vegetables and different types of berries.

Table 1.

Irrigation methods and main water sources for irrigation in the agricultural year 2011/2012.

	Irrigation method (%)			Main water sources for irrigation (%)
	Surface irrigation	Sprinkler irrigation	Drip irrigation	Groundwater	Surface water at the holding	Surface water outside the holding	Public water supply	Other sources
Leskovac	56.2	14.2	29.6	90.3	1.0	6.3	1.0	1.3
Velika Plana	50.3	38.2	11.5	92.2	1.1	3.1	2.4	1.2

Source: Statistical Office of the Republic of Serbia (2013).

Water requirements

Water requirements are determined using accepted methods, as described by Allen et al. (1998) and USDA SCS (1970). Crop evapotranspiration is calculated by multiplying reference evapotranspiration with crop coefficients. Reference evapotranspiration, ETo, is calculated according to the recommended FAO Penman–Monteith method. Irrigation water requirements are calculated as the difference between actual evapotranspiration and effective rainfall (USDA SCS, 1970). The probability level of dependable rainfall is 80%. The Hazen method is used for the determination of the probability of occurrence of rainfall as it is often used for analysing the occurrence of natural phenomena (Harding, 1949). For estimation of gross water requirements, the overall efficiency of the irrigation system (accounting for unnecessary irrigations, losses to deep percolation and runoff) is assumed to be 0.71 (considering distribution efficiency of 0.95 and field application efficiency of 0.75). Necessary data for the calculation are obtained from the official sources: meteorological data for representative weather stations, Smederevska Palanka and Leskovac, provided by the Republic Hydrometeorological Service of Serbia, and data from Census of Agriculture 2012 (Statistical Office of the Republic of Serbia, 2013) are used for the determination of future crop patterns.

Economics

Regarding methodology, there are several indicators (static and dynamic) that could be used for analysing the economics of building such systems. In this case, we analysed three indicators: the investment required for the construction, operating costs and the economic price of water. The analytical calculation method was used for estimating costs that were expected during the exploitation phase of the irrigation systems. Total irrigation costs at the farm sum the costs at the water intake (well, impoundment and river) with the costs of water distribution on the plot, that is, irrigation method (sprinkler, micro-sprinkler and drip irrigation). Total costs are calculated for each year during the entire useful life of the system. Total investment (EUR), annual irrigation costs (EUR), unit investment (EUR ha⁻¹) and unit irrigation cost (EUR ha⁻¹, EUR m⁻³) can be seen as key indicators to the planning processes as they can be used for prioritizing and decision support. Necessary investments and operating costs for both sites were calculated for each structural part of the system (water intake, distribution system, a supply of energy and chosen irrigation system/technology at the farm), as displayed in Figure 2. Calculated values were used as the input for calculation of economic water price, using the method described by Potkonjak et al. (2013). Economic water price was calculated for the period of 30 years of the system exploitation. Included parameters are water quantity (m³), investment and replacement (EUR), operating cost and discount rate (varied from 0 to 10% per year).

Figure 2.

Structure of the investment for the construction of complex irrigation system.

Irrigation investments

When planning the investment that is required to build a complex irrigation system in the municipalities Leskovac and Velika Plana, we developed an investment model as the basis for necessary calculations. An irrigation water distribution system includes complex infrastructure consisting of intake, transmission, distribution and regulation structures, which are followed by large investments that depend on chosen technical parameters (Figure 2).

Irrigation costs

Besides the investments, the irrigation costs are another important indicator that should be considered when planning complex irrigation systems. They are related to the operation of an irrigation system and annual water demand (m³ year⁻¹). The irrigation costs, in this case, serve as a starting element in determining the price of water (total cost at agricultural holdings), which summarizes the costs that relate to the irrigation infrastructure (cost of capital + operating costs). The total price of water is dependent on the amount of water a customer uses; that is, the price of water multiplied by the quantity of the sold water will make revenue to the owner of the (irrigation) water supply infrastructure. Unit irrigation costs are expected to be minimal at the highest water consumption, that is, in dry years, and highest in wet years when water consumption is the lowest. Variability in evapotranspiration demand and precipitation causes irrigation requirements to change from year to year. Consequently, it is more convenient to apply the binomial tariff for distribution of costs between irrigation service users (agricultural farms). These costs apply to the estimated capacity of water sources over a long period of time. If there is a reduction in the capacity of the source (especially relating to the wells), it will inevitably affect the irrigation costs.

Results

Economic analyses and water pricing were preceded by estimation of the capacity of water sources for irrigation and necessary irrigation equipment, which are influenced by crop water requirements and crop pattern. The assessment of water resources capacity is necessary because it can limit the irrigation area.

Water requirements

Water requirements are calculated for the period 1985–2014 for Velika Plana and 1990–2014 for Leskovac, using foreseen crop patterns. Due to differences in topography and soil types in Velika Plana, two crop patterns are anticipated (Table 2). Crop pattern with dominating vegetables, field, industrial and forage crops is typical for the lowland zone, while the crop pattern with dominating orchards and vineyards is typical for the hilly zone. The main difference in comparison with dry land farming is a second harvest, which amounts to 20% in lowland and just 10% in the hilly area, due to the majority of land occupied with perennial crops.

Table 2.

Crop patterns: comparison of current production, recorded by the agricultural census (2012) and projections (in % of utilized agricultural land).

Crop	Velika Plana municipality	Velika Plana		Leskovac municipality	Leskovac
Crop	Census 2012	Lowland projection	Hilly land projection	Census 2012	Leskovacko Polje projection
Cereals	76.7	61.0	27.0	60.0	35.0
Industrial crops	3.5	4.1	0.0	0.1	2.5
Vegetables	1.5	15.4	6.0	5.9	32.4
Fodder crops	13.2	13.5	6.5	10.5	15.2
Seeds	0.3	0.6	–	–	–
Medicinal and aromatic plants	0.05	1.5	1.0	0.1	–
Second harvest	–	20.0	10.0	–	20.0
Orchards	0.7	2.9	42.0	11.9	14.9
Vineyards	2.3	0.0	15.0	2.3	–
Meadows	1.8	1.0	2.5	13.2	–
Without second harvest^a	100	100	100	100	100
With second harvest^a	–	120	110	–	120

^aWith second harvest: irrigation allows a second crop to be harvested during the dry season, thus increasing the total harvested area up to 20%.

Crop water requirements in 4 of 5 years in the studied area are 165 mm in the lowland, 207 mm in the hilly area of Velika Plana and 229 mm in Leskovac (Table 3). The calculated crop requirements for the analysed period varied in a wide range: 3–281 mm in Velika Plana, and 99–326 mm in Leskovac. In Velika Plana, an area of roughly 114.92 km² of agricultural land that belongs to lowland and 104.94 km² of agricultural land within the hilly zone are suitable for irrigation. Assuming the expansion of irrigation systems on 50% of (suitable) utilized agricultural land, it is necessary to deliver 13.4 million m³ year⁻¹ in the lowland and 15.3 million m³ year⁻¹ in the hilly region (when considered system efficiency of 0.71) to fulfil water requirements in 4 of 5 years in lowland and hilly zone, respectively. For irrigation of the whole area, it is necessary to provide 8.79 m³ s⁻¹ in the peak month (July). For irrigation of 4.380 ha in Leskovac (a defined area with developed agriculture), it is necessary to provide 14.1 million m³ year⁻¹ (when considered system efficiency of 0.71). A question that arises here is whether the existing water sources are sufficient to fulfil the irrigation needs in both locations.

Table 3.

Water requirements: the amount of water that will satisfy crop needs in 4 of 5 years.

	April	May	June	July	August	September	Vegetables season
Velika Plana
Lowland
WR_80% (mm)	5.41	17.18	23.60	63.70	51.87	3.49	165
WR_80% (mm day⁻¹)	0.18	0.55	0.79	2.05	1.67	0.12	–
Hilly land
WR_80% (mm)	12.24	26.70	38.75	67.81	55.46	5.72	207
WR_80% (mm day⁻¹)	0.41	0.86	1.29	2.19	1.79	0.19	–
Leskovac
WR_80% (mm)	0.00	11.8	52.7	87.8	74.6	2.18	229
WR_80% (mm day⁻¹)	0.00	0.38	1.76	2.83	2.41	0.07	–

WR: water requirement.

Available water for irrigation

Three water resources were considered for irrigation: groundwater, surface water (major watercourses) and collecting run-off water (using impoundments).

Groundwater

The assessment of the capacity of groundwater in selected regions was based on the existing research and data (Stojadinović, 1997; Stojadinović and Nikić, 2008). The average yield of wells in the alluvion of the Velika Morava River changes along the course, so it is assumed to be 10–15 L s⁻¹ in the northern part of the Velika Plana and 7–10 L s⁻¹ in the central and southern parts of the municipality during the period of maximum exploitation (60 days during the minimum water level); allowed depletion is two-third of the water-bearing layer. It is assumed that each well will supply one conditional plot of 15 or 30 ha, which depends on the well productivity. Relatively shallow groundwater aquifer can be used for irrigation of 3.060 ha (Table 4). For this purpose, totally 102 pumps will be purchased; the drive power required by each pump amounts to 13 kW.

Table 4.

Amount of water available from different sources and the area that can be irrigated with available amounts.

	Assessed
	Q (m³ s⁻¹)	F (km²)
Velika Plana
Groundwater	1.60	30.6
Inner water (impoundments)		25.2
Velika Morava River^a	1.10–2.50^*	16.8
Leskovac
Groundwater	0.65	11.7
Inner water (impoundment Barje)	>2.40	43.8
Juzna Morava River^a	0.64–0.79^*	8.5

^aAvailable water should be uniquely split by consumers on both river shores.

The geology of Leskovacko Polje is more complex; therefore, it is predicted that groundwater will be used from two aquifers: higher productive alluvial and less productive Neogene sediments. Shallow alluvial groundwater wells (54) will be used to extract surface water for irrigating 810 ha, while the deep Neogene wells (12) will extract water for irrigating 360 ha (summed in Table 4).

Impoundments

At the territory of Velika Plana, there are several small impoundments, although their capacity is not sufficient for irrigation. Therefore, the four most dominant watercourses in the southern hilly area of Velika Plana were examined for construction of new dams and impoundments. Before selecting the location of the future dam (up to 15 m high), possible locations were assessed on the basis of the morphology of the surrounding terrain, geological background, state of development of the surroundings and distance from the potential users. The efficiency of future dams was examined as one system because their size and capacity vary, although each one of them represents the strategic point not just for irrigation but also for protection from floods and maintenance of the biological minimum during the summer. The first one was planned at watercourse Gibanica, with a basin area of F = 9.46 km² and total volume of W = 1.06 × 10⁶ m³; the second at watercourse Recica, F = 2.15 km² and W = 0.25 × 10⁶ m³; the third at watercourse Bukovacki Potok, F = 14.07 km² and W = 1.77 × 10⁶ m³; and the fourth at watercourse Siroki Potok, F = 23.25 km² and W = 3.05 × 10⁶ m³. The available amount of water is somewhat greater than 6 × 10⁶ m³ year⁻¹, which would provide water for irrigation of 2520 ha of agricultural land, in case that the total storage of the impoundments is reserved for that purpose. Four pumping stations were planned, with necessary powers of 110, 30, 250 and 400 kW.

The municipality of Leskovac is already using water from the impoundment Barje for water supply. The capacity of this impoundment is large as it was designed for several purposes: water supply, flood control, irrigation, sedimentation control, maintaining biological minimum downstream, hydropower and sports and recreation. The design documentation for the construction of the dam (Energoprojekt, 1983) indicates that it is necessary to heighten the dam by 6.0 m to provide water for irrigation of agricultural areas. However, the capacity of the impoundment was assessed for current size and conditions. The current water storage is approximately 41 million m³, with a usable volume of 21 million m³. The mean monthly flow of the Veternica River of 2.5 m³ s⁻¹ (Energoprojekt, 1983) represents the dynamic input of the impoundment. Therefore, after the subtraction of 37.7M m³ for annual water supply and preserving 10.7 million m³ for maintaining the ecological minimum in Veternica, an amount of around 30 million m³ remains for irrigation, which is more than sufficient for all considered plots.

Rivers

The most ‘reliable’ source of water in the Velika Plana, the Velika Morava River, has certain restrictions (Table 4). During August, which is the most critical month from the hydrological aspect, around 8.3 m³ s⁻¹ of water is available for irrigation of the arable land in the drainage basin of Velika Morava (Milošev et al., 2017). Only a part of this quantity could be taken for the needs of municipality of Velika Plana (up to 0.7 m³ s⁻¹). Clearly, the size of irrigated land depends primarily on the availability of water for irrigation. It is feasible to supply water for irrigation to 1680 ha, with four pumping stations (each requires a power of 180 kW). The idea is to pump water from the river to the compensation tank located at the higher elevation, which will be gravitationally distributed to agricultural plots. In the same manner, the Juzna Morava River was examined as another water source for irrigation in Leskovac. The amount of water that is available to the city of Leskovac is 0.4 m³ s⁻¹, which is sufficient for irrigating 850 ha, with integrated compensation tanks in the system.

Irrigation techniques

According to the Census of Agriculture 2012, agricultural land in the municipalities of Velika Plana and Leskovac was mainly irrigated using the surface irrigation method, and the main water source was groundwater (Table 1). Surface irrigation is unacceptable in terms of development and expansion of irrigated areas because it consumes very large amounts of water. Irrational use of water, especially groundwater and water from a public water supply system, is unacceptable because in that manner valuable resources are consumed. Therefore, the irrigation equipment that is recommended and planned for irrigation development encompasses sprinkler and drip irrigation. Sprinkler irrigation will cover 70% of the area, and drip irrigation, 30% of the area.

Investment in the irrigation system

Investments in the construction of complex water management systems and the operating costs are important parameters in choosing the location of a future irrigation system in the Republic of Serbia. An investment consists of an infrastructural part (water intake and water distribution to the hydrant) that belongs to the water sector and irrigation equipment (depends on the suggested irrigation technique) that belongs to farms. Sustainable development implies a choice of irrigation technology based on saving energy and water, which was considered in planning irrigation development. Building local systems on farms (private and state-owned) and connecting them to the adequate water source are essential to make the whole system operate in the desired manner. Three irrigation farm models were considered, with respect to the irrigation technique: the travelling gun system, micro-sprinklers and drip irrigation (Table 5). The highest unit investment is required for drip irrigation and the lowest for micro-sprinklers.

Table 5.

Investment costs for irrigation systems (at the level of agricultural farm), by on-farm methods (plot size is 2 ha).

No.	Position	Sprinkler	Micro-sprinkler	Drip
1	Water intake	Infrastructure	Infrastructure	Infrastructure
2	Main pipeline (EUR)	125	130	140
3	Hydromechanical equipment (EUR)	960	960	1005
4	Mechanical seal coupler (EUR)	170	170	731
5	Mobile equipment (EUR)
a)	Travelling gun/micro-sprinklers (EUR)	2000	1380	0
b)	Laterals with in-line emitters (EUR)	0		1830
6	Supply, transport and installation (EUR)	280	280	385
7	Total investment (EUR)	3535	2920	4091
8	Unit investment (EUR ha⁻¹)	1767.5	1460.0	2045.5

The infrastructural part of the investment makes a significant part of the total investment (Table 6). Given that the predicted energy source for the system operation is electricity, the investment costs are high, a shortcoming of this solution. Investments for using surface water are in a wide range because we assumed irrigating distant agricultural plots. Large rivers were chosen for irrigating elevated areas, which usually face the lack of sufficient available water resources to meet water needs. Because the pump must overcome the elevation difference, the friction losses and still deliver water at the desired pressure, the required pumps must have high performances, which increase the investment altogether with the long high-pressure pipeline. The water supply structures (wells, impoundments and reservoirs) were in both municipalities planned as independent at known locations, but it is necessary to define criteria for establishing the construction sequence. The method of financing the construction can also have an impact on the selection of structures and construction sequence.

Table 6.

Total and unit investments for the construction of complex irrigation systems.

Parameters	Velika Plana	Leskovac
Groundwater
Irrigation area (ha)	3060	1170
Unit investment in infrastructure (EUR ha⁻¹)	3767	5416
Unit investment in equipment on farm (EUR ha⁻¹)	656	787
Total unit investment (EUR ha⁻¹)	4423	6203
Impoundments/impoundment Barje^a
Irrigation area (ha)	2520	4380
Unit investment in infrastructure (EUR ha⁻¹)	3697	3327
Unit investment in equipment on farm (EUR ha⁻¹)	656	782
Total unit investment (EUR ha⁻¹)	4353	4109
Velika Morava/Južna Morava River^a
Irrigation area (ha)	1680	850
Unit investment in infrastructure (EUR ha⁻¹)	6720	10103
Unit investment in equipment on farm (EUR ha⁻¹)	656	778
Total unit investment (EUR ha⁻¹)	7376	10881
Total irrigation area (ha)	7260	6400

Irrigation costs and water pricing

The costs of irrigation in analysed areas represent the starting point for the water pricing ‘at the hydrant’, that is, the cost of water transport to the agricultural plot. In the long term (30 years), it should cover the initial investment, replacement of equipment as well as all operating costs. Irrigation costs are estimated at the annual level. The recommended rate for capital costs is adopted according to the applicable law (Potkonjak et al., 2013). Fixed costs are considerable, due to very large investments. Calculated prices ranged from EUR0.13 to EUR0.22 m⁻³ in Velika Plana and EUR0.09 to EUR0.30 m⁻³ in Leskovac (Table 8). The price of water ‘at the hydrant’ multiplied by the quantity of the sold water will make revenue to the owner of the irrigation infrastructure, while for the farm that amount will represent the production cost (Tables 7 and 8).

Table 7.

Comparing irrigation costs at the level of agricultural farm, regarding irrigation technology.

Costs	Sprinkler	Micro-sprinkler	Drip
Variable costs
Energy (EUR)	365	470	420
Labour (EUR)	370	270	370
Maintenance (EUR)	310	45	55
Total (EUR)	1 045	785	845
Unit costs (EUR m⁻³)	0.17	0.13	0.14

Table 8.

Irrigation costs for water infrastructure, regarding water resource.

Parameters	Velika Plana	Leskovac^a
Groundwater
Water consumption (m³)	8,544,744	3,775,356
Cost of water at the hydrant (EUR m⁻³)	0.112	0.148
Unit fixed costs (EUR m⁻³)	0.071	0.092
Economic price of water (for the rate 6%) (EUR m⁻³)	0.17	0.21
Impoundments/impoundment Barje^a
Water consumption (m³)	8,069,292	14,135,190
Cost of water at the hydrant (EUR m⁻³)	0.076	0.045
Unit fixed costs (EUR m⁻³)	0.050	0.046
Economic price of water (for the rate 6%) (EUR m⁻³)	0.13	0.09
Velika Morava/Juzna Morava River^a
Water consumption (m³)	5,379,528	2,742,780
Cost of water at the hydrant (EUR m⁻³)	0.125	0.230
Unit fixed costs (EUR m⁻³)	0.090	0.138
Economic price of water (for the rate 6%) (EUR m⁻³)	0.22	0.30
Total consumption of water for irrigation (m³)	21,993,564	20,653,316

^aIn 2010, US$1 ≈ EUR0.8.

Discussion

Groundwater, as freshwater storage, is becoming more and more important due to the rapid growth of population and increasing global demand (Obuobie et al., 2012). High-quality groundwater should be used just to supply population and industry that requires water of such quality. Therefore, the total amount of groundwater that can be abstracted for the agricultural irrigation in Velika Plana and Leskovac covers just a part of the total needs for agricultural irrigation. The advantage of using (shallow) groundwater for irrigation (one well per approximately 30 ha) is possible through joining small farmers in associations, to reduce the total investment that would otherwise increase farmer’s burden.

Separate development of irrigation ‘subsystems’ requires less investment and gives a better chance for the implementation of projects. Large initial investments hinder the activities towards project implementation, regardless of whether it is on the level of a farm or general infrastructure. Installing an irrigation system may seem like a costly endeavour, but when properly chosen and maintained, it brings numerous benefits. Apart from the obvious benefits, such as higher yields, sales and expenditure on farms, irrigation makes new linkages between different sectors and industries in the economy and causes a multiplier effect.

The average calculated investments in infrastructure are EUR3327–3697 ha⁻¹, for properties using water from impoundments, EUR3767–5416 ha⁻¹ for farms surrounding central groundwater wells (for irrigation approximately 30 ha per well) and EUR6720–10,103 ha⁻¹ for properties having supply from rivers (Table 6). It should be noted that here we compare the investments for constructing basic infrastructure, regardless of irrigation equipment cost. Ortiz and Ramirez (2010) assessed that the necessary investment for the investigated area in north Colombia was US$1733 ha⁻¹ (EUR1386 ha⁻¹) for properties having direct supply from surface water and US$4389 ha⁻¹ (EUR3511 ha⁻¹) for farms with groundwater wells. Investment costs regarding irrigation infrastructure cited by Kloezen and Garcés-Restrepo (1998) were about US$8000 ha⁻¹ (EUR6400 ha⁻¹), which confirms that investments in irrigation infrastructure may vary in a wide range, depending on the geographic location, water sources and technical requirements.

Investments in an on-farm irrigation system, as well as operating costs of the system, are a financial burden for farmers. The highest estimated on-farm unit investment, in this case, is for drip irrigation (approximately EUR2000 ha⁻¹) and the lowest for micro-sprinklers (approximately EUR1500 ha⁻¹). The choice of irrigation technique on farm depends on crops grown (field crops, vegetables and orchards). Unit investments for sprinkling irrigation will be significantly decreased if farmers choose a travelling gun that covers a larger area, although it might increase operating costs. It is also possible to combine all three techniques on larger farms. An agricultural holding is faced also with the water expenses (operating costs) at the ‘intake’ or ‘hydrant’, plus the irrigation costs within the property, depending on the chosen irrigation technique, the source of energy and topographic constraints. Nevertheless, farmers find motivation to invest in an irrigation system in the improvement of economic indicators of their business (productivity, economic efficiency and profitability). The improvement of economic indicators can be achieved also by restructuring agricultural production, which includes the introduction of high-value crops, modern farming technologies, water conservation measures and so on.

The irrigation costs represent the starting point for water pricing. Volumetric pricing appears to be the optimal pricing approach that encourages farmers to better control their water use (Easter and Liu, 2005). There is a very large range in the reported volumetric price of water for irrigation: 18–29 US cents m⁻³, applied as a rising block tariff reported in Israel; 16 US cents m⁻³ on schemes drawing from deep aquifers in Spain; in extreme cases, the price per cubic metre may be as high US$1.30 (EUR1.04), as reported for the market garden sector of Holland (Cornish et al., 2004). However, a common ‘average’ volumetric price charged for irrigation water is about 2 US cents m⁻³ (Cornish et al., 2004). Giannakis et al. (2016) registered large differences of prices both within and between countries, for example, from 0.054–0.645 EUR m⁻³ in Greece to 0.23–1.50 EUR m⁻³ in France. Calculated economic water prices for investigated systems, EUR0.13–0.22 m⁻³ in Velika Plana and EUR0.09–0.30 m⁻³ in Leskovac, are within the range of cited values from the literature. Prices and costs related to irrigation water may vary to a large extent with the geographic location, water sources and institutional arrangements (Wichelns, 2010).

Low charges for irrigation water, as well as the small percentage of farmers who actually pay the charges, imply that many irrigation projects have not been sustainable without large government subsidies (Easter and Liu, 2005). The absolute cost of irrigation is not so important in comparison with the fact that with irrigation the farmer is able to achieve lower average product costs and lower variability of margins (Massarutto, 2003). Therefore, relatively high water prices will not necessarily jeopardize the project, because, in some parts of the investigated regions, the conditions are unfavourable for stable agricultural production without irrigation.

This study has importance at regional and national levels as it deals with expanding the irrigated area in a water scarce region, and the issues raised have relevance internationally wherever similar conditions (limitations and prospects) apply. The preliminary findings should be of relevance to policymakers and decision-makers and farmers. The proposed approach to irrigation planning is suitable to balance demand with supply, to reduce environmental problems and to obtain economic viability. Considering all the discussed facts, it is clear that each subsystem has advantages and disadvantages. The advantage of water supply from the river is that the farms, commonly away from the abundant water source, will be supplied by water for irrigation; however, long pipeline and high-performance pumps significantly increase the investment. Nevertheless, it is possible to cultivate high-value crops, which are adapted to climatic and soil conditions of a hilly environment, which would bring higher profit to producers and rapid return on investment. The lowest investments in infrastructure, as well as low water prices, are estimated for the systems supplied from the impoundments. When considering dams and impoundments for irrigation purposes, it has to be emphasized that they have several other purposes (flood control, maintenance of downstream ecological minimum, etc.). They become multipurpose structures that bring multiple benefits to the surrounding and downstream users/residents, so they are not financial burden only for the agricultural sector.

This research has some limitations that need to be recognized when interpreting the results. The study did not account for the irrigation of large agricultural holdings, which would probably use different irrigation methods/devices, such as linear machines or centre pivots. The focus was on smaller farms that usually struggle with water availability and insufficient irrigation infrastructure.

Nevertheless, the outcomes of this study could serve as a guide for setting new objectives for agricultural policy and providing the general framework for development and support for irrigated agriculture in rural areas with limited water sources. This study supports a gradual transition to the economic pricing of water for irrigation, which will cover the long-term investments and operating costs.

Conclusion

This article shows how the fundamental step in irrigation planning is the economic analysis and water pricing, for improving water use efficiency, preservation of water resources and sustainability of the whole system. The proposed approach is based on shared knowledge, experiences and a scientific approach in performing water balance analysis, hydraulic calculations and economic analyses, which is essential to improve the decision-making process. The results and discussion started from the basic concept of irrigation system development, through the investment costs and water pricing to assess water supply costs and water demand values. Construction of the entire water supply system for irrigation purposes requires significant investments. Economic water price, estimated in the range of EUR0.09–0.30 m⁻³, depends on the anticipated water source for irrigation. Even relatively high water prices will motivate farmers to preserve water to some extent and use more efficient technologies and irrigation practices. Considering that less than 4% of utilized agricultural land is currently irrigated, the planned expansion of irrigated area to 15–20% of utilized agricultural land would bring multiple benefits to municipalities Velika Plana and Leskovac. Specifying subsystems and differentiating them by the type of water source allows a step-by-step approach in project implementation, which requires a lower initial investment. Once the first subsystem starts operating, the resulting profit will fund development of the next subsystem. Proposed development through self-sustaining segments has better prospects for the project implementation worldwide but particularly targeting the regions that could benefit from higher levels of irrigated production and lower food prices.

Footnotes

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This research was partially supported by the Ministry of Education, Science and Technological Development of the Republic of Serbia, Grant No. TR 37005.

ORCID iD

Željka Rudić

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