STOCHASTIC OPTIMIZATION OF WATER-SUPPLY EXPANSION

Stochastic dynamic programming is used to schedule the annual expansion of a water supply facility which is being used to supplement a catchment reservoir of fixed storage capacity. The optimal plant construction programme over a planning period of many years is that which optimises the total expected discounted cost, which is made up of investment cost, operating cost, and shortfall penalty cost. Reservoir storage is used as the state variable, and the stochastic structure of the system is derived from the probability distributions of monthly inflows. Storage carryover from year to year is incorporated into the model as an important feature. Copyright 1979 by the American Geophysical Union.