A multi-objective framework for understanding the stability and robustness of cooperative multi-city infrastructure investment pathways addressing changing drought and financial pressures

Abstract:

Increasingly, water utilities are partnering to coordinate the use of regional supply sources and craft cooperative investment pathways for new infrastructure. Such co-evolutionary strategies for development can improve the efficiency of existing resource use and delay or eliminate the need for costly and ecologically harmful infrastructure expansion. When regionally coordinated management strategies are formulated as state-adaptive rule systems, they have been shown to produce strategies that are robust to deeply uncertain future conditions stemming from climate change and population growth. These benefits however come with new challenges for planning and implementation. Effective regional strategies must represent stable compromises that balance conflicting objectives across multiple system partners. Tools from game theory can aid planners in discovering compromises for these systems, however, they require a single a priori preference function for each system actor. This requirement subjects the stability of compromises found through such frameworks to strict assumptions about the preferences of each actor and limits the scope and creativity of potential solutions. Moreover, game theoretic frameworks often require highly simplified system representations that do not adequately capture the dynamics of infrastructure planning and management problems. In this study we present a new simulation-optimization framework for exploring cooperative water management strategies. Our framework uses multi-objective optimization and exploratory modeling to allow cooperating actors to explore trade-offs between their individual objectives and identify vulnerabilities within potential solutions. We propose two new regret-based performance metrics that measure a solution’s robustness to deep uncertainty and regional stability. Our framework is demonstrated on a hypothetical system of three urban water utilities challenged by growing water demand and a changing climate. We demonstrate how our framework allows regional decision makers to identify potential sources of regional conflict and discover robust and stable compromises across actors. Results of this work are broadly applicable beyond water systems to multi-actor infrastructure development problems under deep uncertainty.