PROTECTING BEIJLNG'S MUNICIPAL WATER SUPPLY THROUGH WATERSHED MANAGEMEN AN ECONOMIC ASSESSMENT1

ABSTRACT: Watersheds above the Miyun reservoir, a principal source of surface water for Beijing, are designated to be managed for water production, but under the principle of multiple use. Because of the scarcity of arable land, these watersheds cannot be managed only for drinking water. Efforts are under way to reduce sediment delivery, improve the quality of water entering Miyun reservoir, and improve the welfare of watershed inhabitants. An economic appraisal of a watershed management project for the 3,298‐ha Shixia watershed above the Miyun reservoir, indicates a 24 percent economic rate of return on the investment made in the project. The net present value (NPV) of the project, calculated at a discount rate of 10 percent, is approximately US$3.49 million. Sensitivity analyses indicate that a doubling of labor costs lowers the NPV to US$2.07 million and a 10 percent decrease in benefits lowered the NPV to US$2.87. It is concluded that the implementation of conservation practices on the Shixia Demonstration Watershed represent an economically efficient use of resources.     

MODELING COST-EFFECTIVENESS OF AGRICULTURAL NONPOINT POLLUTION ABATEMENT PROGRAMS ON TWO FLORIDA BASINS1

ABSTRACT: A model was developed to evaluate the cost-effectiveness of alternative “best management practice” (BMP) implementation schemes on two agricultural basins in Florida. The model selectively applies BMPs throughout the basin on a field by field basis, estimates the associated costs, and predicts the relative water quality improvement (reductions in nitrogen and phosphorus). The water quality model links field scale simulation (for detailed BMP evaluation) with basin delivery and attenuation functions to predict the basin-wide effects of any combination of BMPs. Fifteen BMP scenarios were evaluated to aid in prioritizing BMPs for implementation in these basins. Applying the maximum level of BMPs is estimated to cost around $1.2 million (annually), while the four most cost-effective BMPs would cost only one quarter as much, yet are projected to provide approximately 90 percent of the water quality improvement.     

LUMP SUM TAX LOSS REIMBURSEMENT UNDER THE THAMES RIVER FLOOD CONTROL COMPACT1

ABSTRACT: Under the terms of the Thames River Valley Flood Control Compact, Connecticut has been paying Massachusetts 40 percent of the annual property tax losses suffered by seven Massachusetts towns where four flood control structures were located. The permissable alternative of a single lump sum payment was investigated in the study summarized here. The lump sum payment should be the proportion of total benefits (flood control and recreation) from the four structures which Connecticut receives, multiplied by the present value of projected tax losses in the seven tom Flood control benefits and their distribution between the two states were fixed in the Compact, but a survey was necessary to determine recreational benefits and their distribution. Regression analysis of 1957 to 1978 tax loss data provided equations used to project future tax losses. Resent values of projected tax low were calculated using discount rates ranging from 6 to 12 percent. A plausible range of lump sum reinbursements as of 1979 was identified.     

LOCAL ATTITUDES TOWARD ALTERNATIVE USES OF A RESERVOIR PROJECT1

ABSTRACT: The purpose of this paper is to examine the correlates of attitudes toward alternative uses which could have been made of public resources employed to construct a multipurpose reservoir. A sample of 303 adult residents of a rural community impacted by lake construction was asked to evaluate several alternative development options which could have been implemented in lieu of the lake project. The alternative options evaluated were: rural industrialization, keeping land in agriculture and forests, improving public services, building a state or national park, drilling water wells for urban water supply, aid to small business, helping poor people, building several smaller impoundments, and private recreation development. The findings revealed the local people preferred the lake project to every option except keeping the land in agriculture and forest. Even this option was not strongly supported when compared with the lake project. Socio-demographic, attitude, and cost assessment factors were investigated using a “vested interest” perspective for hypotheses development. These findings demonstrated that costs and benefits were relatively good predictors of attitudes toward alternative development options and were supportive of the theoretical perspective advanced in this paper.     

THE ECONOMIC VALUE OF GROUND WATER RECHARGE FOR IRRIGATION USE1

ABSTRACT: Artificial recharge as a means of augmenting water sup plies for irrigation is a management alternative which policy makers in ground water decline areas are beginning to consider seriously. A conceptual model is developed to evaluate the economic benefits from ground water recharge under conditions where the major water use is irrigation. The methodology presented separates recharge benefits into two components: pumping cost savings and aquifer extension benefits. This model is then applied to a Nebraska case to approximate the value of recharge benefits as a function of aquifer response. discount rate, and commodity prices. It was found that recharge benefits vary from less than $2 to over $6 an acre foot recharged.     

OPERATIONAL APPLICATIONS OF SATELLITE SNOW COVER OBSERVATIONS1

ABSTRACT: Several federal and state water resources agencies and NASA have recently completed an Applications Systems Verification and Transfer (ASVT) project on the operational applications of satellite snow cover observations. When satellite snow cover data were tested in both empirical seasonal runoff estimation and short term modeling approaches, a definite potential for reducing forecast error was evident. Three years of testing in California resulted in reduction of seasonal stream flow forecast error was evident. Three years of testing in California resulted in reduction of seasonal stream flow forecast error from 15 percent to 10 percent on three study basins; and modeling studies on the Boise River basin in Idaho indicated that satellite snow cover could be used to reduce short term forecast error by up to 9.6 percent (5 day forecast). Potential benefits from improved satellite snow cover based predictions across the 11 western states total 10 million dollars for hydropower and 28 million dollars for irrigation annually. The truly operational application of the new technology in the West, however, will only be possible when the turnaround time for all data is reduced to 72 hours, and the water management agencies can be assured of a continuing supply of operational snow cover data from space.     

CONJUNCTIVE SURFACE AND GROUND WATER MANAGEMENT IN THE JAKARTA REGION,INDONESIA1

ABSTRACT: This study investigates the degree of economic inefficiency of the current institutional arrangements for surface and ground water management in meeting urban water demand in the Jakarta region. A numerical model of integrated surface and ground water management is developed using GAMS (General Algebraic Modelling System) software. The model maximizes the net present value of social benefits from piped water and ground water consumption across all users over time from 1999 to 2025. Four policy scenarios are examined: the status quo, the social planner's solution, and two ground water pumping quota scenarios: an aggregate ground water pumping quota and a partial quota applied to commercial and industrial users. Three variations in each policy scenario are considered: investment in water infrastructure of the Jakarta water enterprise (PAM Jaya), water demand growth, and discount rates. The status quo, depending on the investment option, the growth of water demand, and the discount rate, results in a 7.4 to 47.8 percent loss in economic efficiency relative to the social planner's solution. The partial quota is the most feasible, applicable, and manageable scenario. The optimal investment option could increase the volume of piped water supply and reduce the cost of water production. The volume of water delivery could increase by up to 156 percent, but it implies only a 35 percent increase in the surface raw water demands above the current level. However, it does not significantly reduce cumulative ground water extraction over the time period considered.     

A NET BENEFIT MODEL FOR RECREATION PLANNING AT DRINKING WATER RESERVOIRS1

A management model was developed for determining levels of recreation activities at public drinking water reservoirs. Quabbin Reservoir, located in central Massachusetts, served as a case study for the model. An interdisciplinary research team was formed to study the impact of selected recreation activities on water quality, public demand and willingness to pay for selected recreation activities, carrying capacity constraints, and the economic cost/benefits associated with increases in recreation at the Quabbin Reservation. Study variables were integrated into a quadratic programming model, producing the number of participants that corresponds to maximum net benefits for specific development packages on design days. The recreation mix associated with maximum net economic benefits was found to be cost-effective (assuming the use of reasonable entrance fees) and not deleterious to water quality. However, as a result of the findings of a related study, it was recommended that nutrients, particularly from wastewater, not be permitted to enter the reservoir, since the current phosphorous level may be at a critical point. Management techniques that would safeguard against this occurrence were recommended. The model was sensitive to management objectives; recommendations were limited to activities that would not lower the existing high quality of Quabbin water.     

A METHODOLOGY FOR EVALUATING DEVELOPMENT-ENVIRONMENTAL CONFLICTS ON WILD AND SCENIC RIVERS1

ABSTRACT: A methodology is developed for examining the environmental and developmental conflicts inherent in the classification process of a wild river. The Salmon River in Idaho is used as an example of the methodology. The steps were: 1. a resource inventory, 2. an evaluation methodology, and 3. an economic comparison of resource use tradeoffs. Alternatives for the Salmon were examined, following generally the procedures outlined in the United States Water Resources Council's Establishment of Principles and Standards for Planning Water and Related Land Resources Final comparisons showed that hydroelectric development had greater net benefits than outdoor recreation at up to a three percent recreation growth rate. When recreation use grew at a faster rate, recreation had a considerable margin of net benefits in its favor.     

Impacts of changes in water quality on recreation behavior and benefits in Finland

The implementation of the European Union Water Framework Directive (WFD) requires nationally generalizable estimates of the benefits of protecting inland and coastal waters. As an alternative to benefit transfers and meta-analyses, we utilize national recreation inventory data combined with water quality data to model recreation participation and estimate the benefits of water quality improvements. Using hurdle models, we analyze the association of water clarity in individuals' home municipalities with the three most common water recreation activities – swimming, fishing and boating. The results show no effect on boating, but improved water clarity would increase the frequency of close-to-home swimming and fishing, as well as the number of fishers. Furthermore, to value the potential benefits of the WFD, we estimate the consumer surplus of a water recreation day using a travel cost approach. A water policy scenario with a 1-m improvement in water clarity for both inland and coastal waters indicates that the consumer surplus would increase 6% for swimmers and 15% for fishers. In contrast to previously estimated abatement costs to improve water quality, net benefits could turn out to be positive. Our study is a promising example of applying existing national recreation inventory data to estimate the benefits of water quality improvements for the purposes of the WFD.     

A COST‐BENEFIT ANALYSIS OF WATER QUALITY PROTECTION IN THE CATAWBA BASIN1

ABSTRACT: The primary objective of this study was to perform a cost‐benefit analysis of maintaining the current level of water quality in the Catawba River basin. Economic benefits were estimated using a stated preference survey method designed to value respondents' willingness to pay for a management plan to protect water quality in the Catawba basin over time. From the surveys conducted with 1,085 area residents, we calculated an annual mean willingness to pay of $139 for the management plan, or more than $75.4 million for all taxpayers in the area. Over the five‐year time horizon in which respondents were asked to pay for the management plan, this resulted in a total economic benefit of $340.1 million. The Watershed Analysis Risk Management Framework model was used to estimate the amount of management activities needed to protect the current level of water quality in the basin over time. Based on the model results, the total cost of the management plan was calculated to be $244.8 million over a ten‐year period. The resulting cost‐benefit analysis indicated that the potential benefits of this management plan would outweigh the costs by more than $95 million.     

STATE FINANCING OF WATER PROJECTS: THE UTAH EXPERIENCE1

ABSTRACT: Dramatic changes in Utah's economy caused by urbanization, large scale energy developments, and other influences will significantly reorient water use patterns. Thus, state water management policies and programs which have evolved over many years should be reevaluated. Several factors have influenced Utah water project financing policy. Among these have been: 1) the prominence of agriculture in the settlement of Utah and the century following, 2) dry cycles and periodic severe droughts, 3) recurring periods of economic depression, and 4) allocation of Colorado River water among the basin states and Mexico, Three revolving funds have been established. The Revolving Construction Fund, created in 1947, provides money for irrigation projects; the Cities Water Loan Fund, created in 1975, provides money to communities for developing culinary systems and improving quality to meet the demands of exploding population growth; and the Water Resources Conservation and Development Fund, created in 1978, provides money for large scale multipurpose water projects costing $1 million or more. The justification for these financing programs seems to be a mixture of rectifying market imperfections and income redistribution. However, trends in the agricultural sector and the multipurpose nature of large scale projects now being funded suggest that earlier justifications may no longer be valid. Rigorous project evaluation procedures, lacking in the past, should be adopted.     

RECREATIONAL ENHANCEMENT OF HIGH COUNTRY WATER SUPPLY RESERVOIRS1

ABSTRACT: There is considerable misconception about the dangers of opening to a recreating public in great need of additional open areas. A systematic procedure for identifying the factors essential to the selectio, planning, and management of reservoirs for recreation is described. A detailed case study conducted by an interdisciplinary project team is presented to demonstrate the feasibility fo maintaining storage levels in recreation-conductive high country reseroirs without unduly injuring downstram water users. The idea is to trade water with reservoirs having less recreation potential. The optimal means of doing this is found via a river basin simulation model with quasi-optimizing capability. Results of the case study show that this strategy is indeed feasible. Applicable to other areas may require analysis of tradeoffs if at least some damage to downstream users is unavoidable.     

MEASURING THE SITE-SPECIFIC RECREATION BENEFITS RESULTING FROM IMPROVED WATER QUALITY: AN UPPER BOUND APPROACH1

The estimation of the value of recreation benefits resulting from improved water quality is required for many purposes. In particular, the Water Pollution Control Act of 1980 requires the consideration of the reasonableness of costs of reducing water pollution in relation to benefits to be derived from establishing effluent standards (Clean Water Act of 1977). Recreation is often the most important benefit resulting from water quality improvement. Current methods used to calculate recreation benefits are either not site-specific or are expensive and controversial. This paper presents a relatively simple, inexpensive, and less controversial method of calculating site-specific recreation benefits resulting from improved water quality. It does this by producing an upper bound estimate which often is adequate for the relevant decision. The upper bound estimates is based on two assumptions: 1) there are alternative equivalent substitute sites for the newly augmented water quality site, and 2) the new augmented recreation opportunities at the site will be used to their maximum supply capacity. Clearly, if an upper bound benefit estimate in a cost-benefit ratio does not produce a favorable ratio, no other benefit estimate will. In cases where this estimate produces an ambiguous result resort must be had to other more precise methods of estimation.     

A DIGITAL MODEL APPLIED TO GROUND WATER RECHARGE AND MANAGEMENT1

ABSTRACT: Under Colorado's appropriative water right system, withdrawals by junior ground water rights must be curtailed to protect senior surface water appropriators sharing the same river system unless the ground water users replace the amount of their injury to the river under an approved plan for augmentation. Compensation of such injury with surface water may not only be expensive but unreliable in dry years. As an alternative, the curtailment of pumping may be obviated by recharging unused surface water into the aquifer when available and withdrawing it when needed. In order to manage such an operation, a practical tool is required to accurately determine that portion of the recharge water that does not return to the river before pumping for irrigation. A digital model was used for this purpose in a demonstration recharge project located in the South Platte River basin in northeastern Colorado. This paper summarizes the experiences gained from this project, the results of the digital model, the economic value of recharge, and the feasibility of the operation. It was determined through the use of the digital model that, with the given conditions in the area, 77 percent of the recharged water remained available for pumping. Economic analyses showed that water could be recharged inexpensively averaging about two dollars per acre foot.     

CITY OF TUCSON WASTE WATER EFFLUENT DELIVERY FACILITY1

ABSTRACT: The Tucson area is totally dependent on ground water, which is in increasingly short supply due to excessive overdrafts. Tucson area waste water treatment plants discharge material quantities of secondary effluent downstream, which is lost to evapotranspiration and recharge of the ground water basin. The city and the four large mining companies who share the common Santa Cruz basin ground water, recognized the common water supply problem and agreed to fund a feasibility study for mining process use of the effluent to partly alleviate the overdraft of ground water. The study analyzed the projected waste water effluent resources, potential mining company demand for waste water effluent and possible interface of an effluent delivery facility with the proposed Central Arizona Project. The effluent resources were analyzed with respect to potential demand. An optimum alignment was selected. An optimum system was detailed through design schematics, amortized cost and finance requirements, and an implementation schedule. It was concluded that a waste water effluent delivery facility could be implemented which would utilize reclaimed effluent in quantities approximating 35 percent of basin overdraft and which would provide revenue for full cost recovery over a 20 year operation period. The mining companies are studying the internal economic impacts of the project.     

OPTIMAL CAPITAL INVESTMENT IN THE EXPANSION OF AN EXISTING WATER RESOURCES SYSTEMS1

The study of the optimal expansion of existing water resources systems is of continuing importance because of the rising demand and limited supply of water in many areas of the world, particularly in the southwestern part of the United States of America. This study is concerned with the investigation of the optimal expansion of a realistic water resources system to meet an increasing demand for municipal and industrial use, irrigation, energy, and recreation over a planning horizon of T years. A number of possible dam sites are available for the further regulation of river (canal) flows in the basin and/or the regulation of imported waters into the basin. To maximize, over the set of alternative projects, the sum of discounted present value of net earnings subject to the demands and various institutional, physical and budgetary limits, an optimization problem (Problem I) was formed as a 0-1 mixed integer programming problem and was decomposed into the set of all feasible combinations (Problem II). The economic return was determined for each combination (Problem III). Problem II was solved by a branch and bound procedure which selected each feasible combination of dams while the optimal return for each such combination (Problem III) was found by a network analysis code.     

OPTIMAL OPERATION OF SHELBYVILLE AND CARLYLE LAKES1

ABSTRACT: Dams were built by the U. S. Army Corps of Engineers on the Kaskaskia River at Shelbyville and Carlyle in Illinois, in 1969 and 1967, respectively. The operation of the Shelbyville and Carlyle Lakes has changed over the years because of considerably lower bankfull channel capacities downstream of the dams than were adopted in the project designs. This study was conducted to review the present operation policy. Intent was to derive a policy for maximizing the overall benefits (or minimizing the overall damages) and to compare these benefits or damages with those with the present policy. The operating rules were optimized through a simulation model which was structured considering the physical nature of the system and the desirable operation in the best interest of various beneficial uses. The expected annual value of overall benefits from recreation and agriculture is shown to increase by $0.2 million with the optimal policy. With the optimal operation, the overall damages are reduced by 76 percent on the average over the 24 years of flow record at Shelbyville and Carlyle.     

ECONOMIC ANALYSIS OF WETLAND RESTORATION ALONG THE ILLINOIS RIVER1

Creating and restoring wetland and riparian ecosystems between farms and adjacent streams and rivers in the Upper Mississippi River Basin would reduce nitrogen loads and hypoxia in the Gulf of Mexico and increase local environmental benefits. Economic efficiency and economic impacts of the Hennepin and Hopper Lakes Restoration Project in Illinois were evaluated. The project converted 999 ha of cropland to bottomland forest, backwater lakes, and flood‐plain wetland habitat. Project benefits were estimated by summing the economic values of wetlands estimated in other studies. Project costs were estimated by the loss in the gross value of agricultural production from the conversion of corn and soybean acreage to wetlands. Estimated annual net benefit of wetland restoration in the project area amounted to US$1,827 per ha of restored wetland or US$1.83 million for the project area, indicating that the project is economically efficient. Impacts of the project on the regional economy were estimated (using IMPLAN) in terms of changes in total output, household income, and employment. The project is estimated to increase total output by US$2,028,576, household income by US$1,379,676, and employment by 56 persons, indicating that it has positive net economic impacts on the regional economy.     

TEMPERATURE EFFECTS ON GREAT LAKES WATER BALANCE STUDIES1

ABSTRACT. Beginning of month water temperature profiles are estimated for each lake. These water temperature profiles along with surface water temperatures are used to determine the effects of thermal expansion and contraction of water on the net basin supply values obtained from water balance studies using end of month lake levels. It is demonstrated that net basin supply values (equivalent to precipitation on the lake minus the evaporation from the lake plus the runoff into the lake) obtained from water balance studies without accounting for the thermal expansion and contraction of water may be in error by as much as 100 percent during some months for each lake.