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Opportunity costs of a transbasin diversion of water: 1. Methodology
Author(s) -
Moncur James E. T.
Publication year - 1972
Publication title -
water resources research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.863
H-Index - 217
eISSN - 1944-7973
pISSN - 0043-1397
DOI - 10.1029/wr008i006p01415
Subject(s) - inflow , water diversion , scale (ratio) , water supply , value (mathematics) , environmental science , opportunity cost , water resource management , measure (data warehouse) , operations research , computer science , mathematical optimization , mathematics , environmental engineering , economics , geology , microeconomics , oceanography , physics , quantum mechanics , machine learning , database
A large‐scale transbasin water diversion project must be justified not only in terms of the direct costs of transporting water but also in terms of the value of services foregone by the exporting region due to the diminution of its water supply. A general model is developed to evaluate these opportunity costs. The procedure adapts the decomposition algorithm for linear programs to optimize operations of the water system with respect to time, multiple complementary and competitive uses, and location, allowances being made for serial as well as parallel configurations of reservoirs. The algorithm solves iteratively for the optimal value of the river's services. Two solutions are needed: one assuming ‘natural’ inflow conditions and, to simulate the situation after a diversion, one assuming depleted inflows. The difference between these optimal values is a measure of the opportunity costs incurred by the water‐exporting region. A subsequent article applies the procedure to the Columbia River basin.