Research On Optimization Of Water Resources Allocation Based On Water Options Under Uncertainty

Water resources are an important factor for the sustainable economic and social development.In China,due to the large population,uneven spatial and temporal distribution of water resources,water pollution and waste,the conflict between water resources supply and demand is increasingly serious,which affects the industry,the agriculture and people’s life severely.For a long time,the administrative allocation has been the main method in allocating water resources in China,which resulted in the water price distortion and the inefficient use of water.Therefore,a research on the water resources optimal allocation is crucial for the sustainable development of the economics and the society,as well as the improvement of ecological environment.Market mechanism plays an important role in water resources allocation due to its function in solving the conflict between the supply and demand of water resources and in increasing the utilization efficiency of water resources.How to avoid the risks of water shortage and water price fluctuations in market mechanism has become urgent problems for water managers.Water options empower the holders to buy or sell a certain amount of water at an agreed price for a specific period of time in the future.Compared with spot purchase,water options may not only reduce the risks caused by some uncertain factors such as human,nature,and economics,in the process of water resources management,but also improve the reliability of water supply and reduce the costs of water resources management.In this sense,this thesis studies the optimal allocation of water resources in the environment of uncertain factors based on water options.The main contents are as follows:(1)The design and pricing of water options are given.With the consideration of the complexity and special needs of water resources management,the scarcity and the long duration of water resources,the uncertainty of available water quantity,this thesis puts forward the design scheme of water option,and sets the execution conditions and the flexible quantity of water options.Due to the complexity of water options and the incomplete market characteristics of water market,the traditional option pricing method cannot be used in water options.This thesis analyzes the impact of uncertain factors in the process of water resources management,describes the water pricing as an uncertain jump process,and finally gives the pricing formula of water call options under uncertain conditions.(2)The optimization model of water resources allocation under uncertainty with water call options is constructed.With the consideration of the two-stage characteristics of decisionmaking process of water call options and the various uncertainties in water resources system,by using the inexact two stage stochastic mixed-integer programming(ITSMIP)model,this thesis constructs the optimization model of water resources allocation under uncertainty with water call options,and gives the solution algorithm.The results proves the effectiveness of the model and algorithm.On the one hand,the influencing factors for water managers to use water call options include execution threshold,maximum executable quantity,execution price,water option fee,and so on.On the other hand,water call options may help water managers mitigate the impact of water shortage and increase the economic benefits largely.(3)The optimization model of water resources allocation under uncertainty with chooser options is constructed.Since water available is not enough to meet the demand in dry seasons,and surplus water will be released in wet seasons,this thesis designs the chooser options for water managers to buy additional water in dry seasons and sell redundant water in wet seasons,which can avoid both the risk of water shortage and the waste of water.By using the inexact two stage stochastic mixed-integer programming(ITSMIP)model,this thesis constructs the optimization model of water resources allocation under uncertainty when chooser options are proposed,and gives the solution algorithm.The results demonstrate the effectiveness of the model and algorithm.On the one hand,chooser option is a more flexible tool for water management.On the other hand,through the use of chooser options,the water allocation of high-value water users is increased,while the water demand of low-value water users is restrained,which is conducive to the improving the efficiency of water resources.(4)The optimization model of water resources allocation under uncertainty with water call options applied in inter-regional water transfers is constructed.As the seller of water call options,water transfer regions may benefit from water options,as well as bear the risk of water shortage caused by the exercises of water options.With the interval-parameter two-stage stochastic multi-objective mixed integer programming(ITSMMIP)model,and considering the various uncertainties of call water options for the seller,this thesis constructs the uncertainty optimization model of water resources allocation when water call options are applied in interregional water transfers and gives the solution algorithm.The results proves the effectiveness of the model and algorithm.On the one hand,the economic benefit may be maximized through choosing the maximum water availability and the exercise prices of water call options.On the other hand,by using water call options,the water transfer regions obtain certain economic compensation and the water demand regions gain additional water to ensure water security in dry seasons.(5)The optimization model of water resources allocation under uncertainty with water call options in inter-regional water transfers is applied in a multi-source water diversion system.Since water managers purchase different water options from multiple water suppliers,a water call option portfolio is formed.The ITSMMIP model is applied to analyze the optimization of water resources allocation when a water call option portfolio is proposed in Dalian,while the models of(2)and(3)are applied in spot water purchase.Through the comparison of the results,ti can be seen that the water transfer with calling water options helps to ensure the water security in the areas south to Jinzhou of Dalian during dry seasons.By studying the influence of water call options on the net benefits of Dalian,the water resources planning suggestions for Dalian are proposed.