Open AccessInvesting in water supply resilience considering uncertainty and management flexibility
Author(s) -
Bryan T. Adey,
Claudio Martani,
Jürgen Hackl
Publication year - 2022
Publication title -
proceedings of the institution of civil engineers. smart infrastructure and construction
Language(s) - English
Resource type - Journals
ISSN - 2397-8759
DOI - 10.1680/jsmic.21.00005
Subject(s) - flexibility (engineering) , resilience (materials science) , investment (military) , risk analysis (engineering) , business , production (economics) , environmental economics , psychological resilience , population , key (lock) , investment decisions , service (business) , water supply , environmental resource management , natural resource economics , computer science , economics , environmental science , microeconomics , environmental engineering , computer security , law , psychotherapist , sociology , psychology , management , marketing , political science , thermodynamics , physics , demography , politics
This paper demonstrates how to make investment decisions that optimally improve water supply resilience, taking into consideration both future uncertainty and management flexibility. The demonstration is done by evaluating investment strategies for a 38 Ml/d water treatment plant serving an urban area with approximately 75 000 inhabitants, where there is uncertainty with respect to future population growth, industrial production, external demand and the amount of rainfall due to climate change. It is shown that the quantification and comparison of the possible reductions in service and intervention costs over comparably long periods enables the optimal investment decisions – that is, the ones with the optimal trade-offs between stakeholders. Additionally, it can be seen that the used methodology enables the consistent and transparent consideration of (a) the concerns of multiple stakeholders, (b) the future deep uncertainty associated with key concerns and (c) the flexibility of infrastructure managers to make decisions in the future using new information. The methodology also ensures that managers have clear plans of action and considerable insight into the extent of required future financing.