The groundwater pump allows you to pump water to your generators without needing to be next to a water source like normal water pump. But the groundwater pump does has its limitations. First of all, the groundwater pump has to be next to a water pipe to displace water at all. Which the normal water pump can do. Else than that the groundwater pump is overall better. It has better max water and water production yet cost more to buy and upgrade.
See the picture to the right, it is the little brown tube with the weird top. This basically how the groundwater pump should work. It should be placed next at a water pipe in front of a generator feeding into a heat source. Woo!