Hydroeconomic Optimization of Water Management in the Tiaoxi Watershed of Lake Taihu, China

The Tiaoxi River in northern Zhejiang Province, China, flows northward and drains an area of 4,576 km2 before reaching the Lake Taihu in the Yangtze River Delta, a major economic hub of the country. Despite relatively abundant rainfall and streamflow in the watershed, it faces serious seasonal water shortages and increasing levels of conflicts between various economic objectives such as water supply, irrigation, and hydropower generation and environmental objective. Thus, a holistic analysis considering and reconciling multiple objectives is badly needed for water management in the Tiaoxi watershed. This study seeks to bridge that gap by developing a hydroeconomic optimization model, which includes detailed spatial distribution and temporal variability of water demand from various sectors. Besides the quantities of water demand and optimized supplies, the model also provides economic benefits from different water-using sectors and the marginal values of water under scarcity conditions. The optimal water allocation strategies and economic valuation of water provides both specific recommendations for improving coordinated water management at present and useful insights for future development and protection of water resources in the watershed towards enhanced sustainability and resilience.