19. Modeling Economic-Engineering Responses to Drought: The California Case

Recurring droughts pose predictable challenges to water resources management in California. Disparities in water demand and supply over both space and time, fast-growing cities, prominent agriculture, and increasing concerns on maintaining and improving habitat for native species are among the most salient challenges to water allocation in the state. This chapter explores portfolio approaches to water management under drought conditions. We analyze water management portfolios that are economically optimized to minimize water scarcity and operating costs within some physical and operating constraints. Water management portfolios include intra- and inter-regional water transfers, flexible water storage operations, and conjunctive use, water conservation, and water augmentation via reuse or desalination. This enables us to identify economically attractive opportunities for re-operation of the water supply system. Results from the case studies indicate that despite the significant reductions in water supply under drought or climate change, California’s inter-tied network of water resources has the ability to adapt in the long term to these drought events by adding operational flexibility in the system.