Question

municipal water tanks are placed at a height greater than the tallest buildings to which water is supplied

Answer 1

When water is stored at a height then there the potential energy stored in the water increases and we do not need any more energy to let it flow down, because water as we know generally flows from a point of higher potential to lower potential, whereas if the tanks were kept at the ground level then every time someone opens a tap then energy will have to be supplied to it (generally through pumps) to lift it up.