Adaptive Water Resource Planning Using Decision-Rules

Dealing with uncertainty in water resource planning is problematic because insufficient or underused infrastructure can have social and environmental costs. Multistage stochastic optimisation provides a mechanism to deal with this challenge in water supply capacity expansion planning. However, for real systems it can be mathematically hard and computationally expensive. The ‘Decision-rule’ formulation represents an attempt to remedy this by approximating the multistage problem where decisions at each stage are a function of the uncertainty and the state of the system. We introduce a family of rules to show how they approximate the multistage problem and investigate the implications of the approximation for adaptive water resources planning.