Risk, Robustness and Water Resources Planning Under Uncertainty

TLDR

Risk‑based water resources planning assumes investment stops when marginal benefit of risk reduction equals marginal cost, but this cost‑benefit approach may fail to ensure robustness under uncertain future conditions such as climate change. The study expands risk‑based decision analysis to link risk attitudes with robustness, enabling stakeholders to trade incremental robustness gains against investment costs for a specified risk level. Risk is quantified as the expected annual cost of water‑use restrictions, robustness as the ability to maintain tolerable risk across diverse future scenarios, and the framework is illustrated with a London water‑supply case study using state‑of‑the‑art regional climate simulations.

Abstract

Risk‐based water resources planning is based on the premise that water managers should invest up to the point where the marginal benefit of risk reduction equals the marginal cost of achieving that benefit. However, this cost‐benefit approach may not guarantee robustness under uncertain future conditions, for instance under climatic changes. In this paper, we expand risk‐based decision analysis to explore possible ways of enhancing robustness in engineered water resources systems under different risk attitudes. Risk is measured as the expected annual cost of water use restrictions, while robustness is interpreted in the decision‐theoretic sense as the ability of a water resource system to maintain performance—expressed as a tolerable risk of water use restrictions—under a wide range of possible future conditions. Linking risk attitudes with robustness allows stakeholders to explicitly trade‐off incremental increases in robustness with investment costs for a given level of risk. We illustrate the framework through a case study of London's water supply system using state‐of‐the ‐art regional climate simulations to inform the estimation of risk and robustness.