The opportunity costs of increasing reliability in irrigation systems

Increasing water reliability in a catchment requires reducing the total quantity of water available to users in some years in order to supply it in more years when its supply is constrained. Thus, the more reliable the supply the more water that needs to be withheld. Consequently, increased levels of water reliability to a catchment, which reduces the costs associated with an unreliable supply, often comes at an incremental increase in costs that researchers do not consider; that of the water foregone that could be have been used productively if the system had been run less reliably. In this paper the trade-offs between the costs of water foregone to maintain a level of reliability and the costs associated with an unreliable supply of water at different levels of reliability in an irrigation system are discussed. The concepts developed are applied to the irrigation sector in the Musi catchment in Andhra Pradesh, India from 2011 to 2040. In this catchment it was found that the costs of water foregone to increase reliability rise as the level of reliability rises, while the benefits generally fall. When the level of reliability exceeded approximately 85% (where water is so scarce that it is used on only the most valuable output), the costs of greater reliability exceed the benefits resulting in net losses to the system. These results were found to vary in each demand centre across the catchment. These results have implications for those considering innovations that improve the level of reliability in a catchment.