Nonlinear optimisation using production functions to estimate economic benefit of conjunctive water use for multicrop production

An-Vo, D.-A. ORCID: and Mushtaq, S. and Nguyen-Ky, T. and Bundschuh, J. and Tran-Cong, T. and Maraseni, T. N. ORCID: and Reardon-Smith, K. (2015) Nonlinear optimisation using production functions to estimate economic benefit of conjunctive water use for multicrop production. Water Resources Management, 29 (7). pp. 2153-2170. ISSN 0920-4741


Uncertainty and shortages of surface water supplies, as a result of global climate change, necessitate development of groundwater in many canal commands. Groundwater can be expensive to pump, but provides a reliable supply if managed sustainably. Groundwater can be used optimally in conjunction with surface water supplies. The use of such conjunctive systems can significantly decrease the risk associated with a stochastic availability of surface water supply. However, increasing pumping cost due to groundwater drawdown and energy prices are key concerns. We propose an innovative nonlinear programing model for the optimisation of profitability and productivity in an irrigation command area, with conjunctive water use options. The model, rather than using exogenous yields and gross margins, uses crop water production and profit functions to endogenously determine yields and water uses, and associated gross margins, respectively, for various conjunctive water use options. The model allows the estimation of the potential economic benefits of conjunctive water use and derives an optimal use of regional level land and water resources by maximising the net benefits and water productivity under various physical and economic constraints, including escalating energy prices. The proposed model is applied to the Coleambally Irrigation Area (CIA) in southeastern Australia to explore potential of conjunctive water use and evaluate economic implication of increasing energy prices. The results show that optimal conjunctive water use can offer significant economic benefit especially at low levels of surface water allocation and pumping cost. The results show that conjunctive water use potentially generates additional AUD 57.3 million if groundwater price is the same as surface water price. The benefit decreases significantly with increasing pumping cost.

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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Additional Information: Permanent restricted access to Published version in accordance with the copyright policy of the publisher
Faculty/School / Institute/Centre: No Faculty
Faculty/School / Institute/Centre: No Faculty
Date Deposited: 26 May 2015 05:05
Last Modified: 14 Feb 2017 01:14
Uncontrolled Keywords: surface water; groundwater; conjunctive water use models; agricultural production; profit functions; optimal multicrop production; sequentially quadratic programming technique
Fields of Research (2008): 07 Agricultural and Veterinary Sciences > 0799 Other Agricultural and Veterinary Sciences > 079901 Agricultural Hydrology (Drainage, Flooding, Irrigation, Quality, etc.)
05 Environmental Sciences > 0502 Environmental Science and Management > 050206 Environmental Monitoring
05 Environmental Sciences > 0501 Ecological Applications > 050101 Ecological Impacts of Climate Change
05 Environmental Sciences > 0501 Ecological Applications > 050104 Landscape Ecology
Fields of Research (2020): 30 AGRICULTURAL, VETERINARY AND FOOD SCIENCES > 3002 Agriculture, land and farm management > 300201 Agricultural hydrology
41 ENVIRONMENTAL SCIENCES > 4104 Environmental management > 410404 Environmental management
41 ENVIRONMENTAL SCIENCES > 4101 Climate change impacts and adaptation > 410102 Ecological impacts of climate change and ecological adaptation
41 ENVIRONMENTAL SCIENCES > 4102 Ecological applications > 410206 Landscape ecology
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