Economic Value of Climate Change Adaptation Strategies for Water Management in Spain’s Jucar Basin

Abstract

Although many recent studies have quantified the potential effects of climate change on water resource systems, the scientific community faces now the challenge of developing methods for assessing and selecting climate change adaptation options. This paper presents a method for assessing impacts and adaptation strategies to global change in a river basin system at different temporal horizons using a hydro-economic model. First, a multiobjective analysis selects climate change projections based on the fitting of the climate models to the historical conditions for the historical period. Inflows for climate change scenarios are generated using calibrated rainfall-runoff models, perturbing observed meteorological time series according to the projected anomalies in mean and standard deviation. Demands are projected for the different scenarios and characterized using economic demand curves. With the new water resource and demand scenarios, the impact of global change on system performance is assessed using a hydro-economic model with reliability and economic indices. A new economic loss index is defined to assess the economic equity of the system. Selected adaptation strategies are simulated to compare performance with the business-as-usual scenario. The approach is applied to the Jucar River water resource system, in eastern Spain, using climate projections from the European Union (EU) ENSEMBLES project. Results show that the system is vulnerable to global change, especially over the long term, and that adaptation actions can save €3–65 million/year.