Cities are hotspots of commodity consumption, with implications for both local and systemic water resources. Water flows “virtually” into and out of cities through the extensive cross-boundary exchange of goods and services. Both virtual and real water flows are affected by water supply investments and urban planning decisions, which influence residential, commercial, and industrial development. This form of water “teleconnection” is being increasingly recognized as an important aspect of water decision-making. The role of trade and virtual water flows as an alternative to expanding a city’s “real” water supply is rarely acknowledged, with an emphasis placed instead on monotonic expansion of engineering potable water supplies. We perform a literature review of water footprint studies to evaluate the potential and importance of taking virtual flows into account in urban planning and policy. We compare and contrast current methods to assess virtual water flows. We also identify and discuss priorities for future research in urban water footprint analysis.

Water footprinting has revealed hydro-economic interdependencies between distant global geographies via trade, especially of agricultural and manufactured goods. However, for metropolitan areas, trade not only entails commodity flows at many scales from intra-municipal to global, but also substantial intra-metropolitan flows of the skilled labor that is essential to a city’s high-value economy. Virtual water flows between municipalities are directly relevant for municipal water supply policy and infrastructure investment because they quantify the hydro-economic dependency between neighboring municipalities. These municipalities share a physical water supply and also place demands on their neighbors’ water supplies by outsourcing labor and commodity production outside the municipal and water supply system boundary to the metropolitan area. Metropolitan area communities span dense urban cores to fringe agricultural towns, spanning a wide range of the US hydro-economy. This study quantifies water footprints and virtual water flows of the complete economy of the Phoenix Metropolitan Area’s municipalities. A novel approach utilized journey to work data to estimate virtual water flows embedded in labor. Commodities dominate virtual water flows at all scales of analysis, however labor is shown to be important for intra-metropolitan virtual water flows. This is the first detailed water footprint analysis of Phoenix, an important city in a water-scarce region. This study establishes a hydro-economic typology for communities to define several niche roles and decision making points of view. This study’s findings can be used to classify communities with respect to their relative roles, and to benchmark future improvements in water sustainability for all types of communities. More importantly, these findings motivate cooperative approaches to intra-metropolitan water supply policy that recognize the hydro-economic interdependence of these municipalities and their shared interest in ensuring a sustainable and resilient hydro-economy for all members of the metropolitan area.