The traditional sources of water for towns and cities have been from the river systems, which had storage dams built on them to ensure water year around. Water from rivers and dams typically has been cheaper than other sources because of the lower cost in terms of infrastructure on a per litre basis. The ability to grow the availability of this form of water supply has become far more restrictive due to more rigid environmental requirements, along with the fact the easier and more accessible dam sites have now been used. The costs of building dams have risen significantly in recent years resulting in higher cost per litre for this water.

Ground water is used extensively in areas that have large volumes of water in aquifers which are readily available. Cites such as Perth obtain a large amount of their domestic water from groundwater. The issue that must be remembered is aquifer water is effectively large storage dam that is underground and it is a finite resource. There is only so much water that can be extracted from the groundwater system without having a negative impact on it.

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