Low service coverage of public water supply companies and high dependency on groundwater are typical characteristics of urban water supply provision in developing countries. A case study of Semarang, Indonesia, shows that such phenomena have a detrimental effect on the environment. Land subsidence, seawater intrusion and sea flooding are, to some extent, the results of the failure of the public water supply company to service all Semarang City inhabitants. The study of the Semarang coastal area shows that the lack of access, especially to the poor, is a business opportunity for small-scale water supply providers. The problem with these providers is that all of them use groundwater as sources. The worse the service of the public water supply company the more necessary it is to regulate groundwater extraction. The poor will become very dependent on groundwater while also becoming victims of environmental degradation due to excessive groundwater extraction. The study shows that all inhabitants, poor and rich alike, are waiting to be supplied by the public water supply company. They will change to the public water supply whenever the service is available.

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