Abstract
This study analyses the impact of assuming perfect foresight of future agro-hydrological events in hydroeconomic analysis of water infrastructure projects. The impact is evaluated based on the estimated monetary benefits of a proposed water infrastructure investment diverting Yellow River water to the Hai River basin in China, resulting in supply augmentation and improved water quality. The impact of foresight is quantified as the change in project benefits, evaluated with different assumed lengths of future foresight compared to a perfect foresight benchmark. A hydroeconomic optimization model formulated as a deterministic Linear Program, LP, is optimized to represent the perfect foresight benchmark. Imperfect foresight is modeled by wrapping the hydroeoconomic optimization model in a Model Predictive Control, MCP, framework. Using this LP-MPC framework, different lengths of foresight can be modeled by continuous re-optimizations with updated forecasts over a planning horizon. The framework is applied to the water-scarce and polluted Hai River basin in China, which is suffering from groundwater overdraft and is dominated by agricultural irrigation demands. The hydroeconomic optimization model describes the nine largest reservoirs in conjunctive use with the major groundwater aquifers. The water infrastructure project, allowing transfers of Yellow River water to the plain area of the Hai River basin, is evaluated under long-term sustainable groundwater abstraction constraints, and joint water allocation and water quality management. The value of foresight in agricultural water allocations is represented, using a model that links yield response to water allocations, accounting for delayed yields in agricultural irrigation. Estimated benefits of the proposed project evaluated with decreasing lengths of foresight and compared to the perfect foresight benchmark show that an assumption of perfect foresight underestimates the actual benefits of the water infrastructure investment in the irrigation intensive Hai River basin. This study demonstrates that it is important to evaluate the impact of assuming perfect foresight in any hydroeconomic analysis, to avoid misleading conclusions regarding the costs and benefits of planned projects.
Highlights
Water resources planning often deals with the question of “how to best adapt to future conditions?” Such adaptation can include investments in new water infrastructure or modified water allocation schemes
This study evaluated the impact of perfect foresight assumptions on project benefits in hydroeconomic analyses, illustrated by a case study of a water infrastructure project in China
The model framework was used to evaluate the benefits of a water infrastructure project in the water-scarce Hai River basin, considering both the cost of delivering water qualities fit for purpose as well as the concept of delayed yield among agricultural users
Summary
Water resources planning often deals with the question of “how to best adapt to future conditions?” Such adaptation can include investments in new water infrastructure or modified water allocation schemes. End-constraints of model surface water reservoir and groundwater aquifer storages in the final time step of the planning horizon were based on pre-optimized average yearly storage policies of an ensemble of 50 synthetic time series over a sufficiently long period, to represent a wide range of climate conditions. A one-time step ahead re-optimization of the “true” time series in t, with fixed one-time-step-ahead end-constraints for crop states, reservoir, and groundwater aquifer storages, found from the average ensemble optimum, was implemented This step represented the actual water management, facing the true reservoir inflow and meteorological conditions during that month, and the reservoir operations based on the available future foresight. Computation time for the whole parallelized LP-MPC setup was ∼360 CPU hours using a 12-core Intel Xeon E5-2650 v4 processor with 256 GB memory
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