Planning and institutional design under uncertainty and increasing water scarcity Julien Harou, UCL January 19, 2012, University of Oxford UK Challenges • Scarcity: resources are over-licensed and over- abstracted in numerous basins, e.g. South East • Uncertainty: Climate and demographic changes could aggravate scarcity • Public demands for: ecological health, low water prices, and generally fair, efficient and effective management of water resources Challenges motivate formulation of new policies and increased sophistication in planning methods Some proposed policy solutions • Innovative demand management schemes including seasonal or block tariffs, smart meters, etc. • Increase system reliability and robustness by better planning under uncertainty • Enforce sustainability reductions and reform abstraction licensing system – move to a right to some proportion of environmentally available water? – ‘Real-time’ licence pricing as a function of supply? • Water trading – Regional: between water companies – Local: between catchment licence holders General water planning challenges 1. Choosing amongst near-infinite set of different plans (infrastructures, policies) 2. Recognising multiple sources of performance: cost, environment, but also robustness, resilience, adaptability, flexibility, etc. 3. Representing sufficient complexity (physics, engineering, behaviour) 4. Decisions under uncertainty (physical & human, known randomness vs. unknowns) Help! … tools required • Given systems are large, complex and changing over space & time … models can help • Models must adequately represent physics and management of the real system at appropriate scales • Mix of simulation & optimisation methods appropriate • Planning under uncertainty methods useful: M.C. sim., RDM, info-gap, real options, etc. Some policy models 1. Supply-demand models for investing in new supplies & demand management under uncertainty 2. Regional water trading and water company incentives 3. Water rights (licensing) reform at catchment level Funders: EPSRC, EA, HR Wallingford, Thames Water, Ofwat Collaborators: HR Wallingford, Cranfield, Oxford, Leeds, Loughborough, Heriot Watt, etc.
Transcript
Planning and institutional design under uncertainty and
increasing water scarcity
Julien Harou, UCL
January 19, 2012, University of Oxford
UK Challenges• Scarcity: resources are over-licensed and over-
abstracted in numerous basins, e.g. South East • Uncertainty: Climate and demographic changes
could aggravate scarcity• Public demands for: ecological health, low water
prices, and generally fair, efficient and effective management of water resources
Challenges motivate formulation of new policies and increased sophistication in planning methods
Some proposed policy solutions• Innovative demand management schemes
including seasonal or block tariffs, smart meters, etc.
• Increase system reliability and robustness by better planning under uncertainty
• Enforce sustainability reductions and reform abstraction licensing system – move to a right to some proportion of environmentally
available water?– ‘Real-time’ licence pricing as a function of supply?
• Water trading– Regional: between water companies– Local: between catchment licence holders
General water planning challenges
1. Choosing amongst near-infinite set of different plans (infrastructures, policies)
2. Recognising multiple sources of performance: cost, environment, but also robustness, resilience, adaptability, flexibility, etc.
