This project examines potential climate change and variability adaptation strategies in the water and energy sectors in the Southwest. Researchers are investigating how climate influences the market price of water and are developing a menu of supply reliability tools and guidelines for using these tools to enhance water supply reliability. Researchers are also developing improved methods for predicting and adapting to climate impacts to the generation of electricity.
Power contracts tend to be long term and inflexible, but persistent drought and climate change affect the range of costs, and hence energy and water management operations and policy. Increased temperatures will increase summer power demand in the Southwest due to higher energy requirements for indoor cooling, agricultural irrigation, and urban outdoor water use. Multi-decade drought will reduce electricity supply reliability and hydropower generation. Water and power costs are likely to increase, leading to increased financial stress for households and businesses and resource management challenges in the water and energy sectors. This research investigates new methods for predicting and adapting to climate impacts linked to the energy sector.
Methods: econometric analysis of climate, weather, socio-demographic and electricity and water use data to improve electricity load forecasts and to assess the implications of misinterpretation of seasonal climate forecasts by water managers
Goals and Outcomes: improve forecasting of electricity loads and integration of climate considerations into electric and water utility planning
Colby, B. and G. Frisvold. 2011. Risk and Resilience: The Economics of Climate-Water-Energy, Challenges in the Arid Southwest. Resources for the Future Press.
Basta, E. and B. Colby. 2010. Water Market Trends: Transactions, Quantities, and Prices. The Appraisal Journal, 78 (1): 50-66.
Jones, L. and B. Colby. 2010. Weather, Climate, and Environmental Water Transactions. Weather, Climate, and Society 2(3): 210-223.
O’Donnell, M. and B. Colby. 2010. Water Banks: A Tool for Enhancing Water Supply Reliability. University of Arizona, Department of Agricultural and Resource Economics.
Colby, B. 2009. Innovative Voluntary Transactions as a Response to Competing Water Claims. In Water Management in Urbanizing, Arid Regions, Arial Dinar and Jose Albiac, (eds). Ashgate Publishing.
Colby B. and R. Bark. 2009. Inter-sectoral water trading as a climate change adaptation strategy. In Water Resoucres Planning and Management, Q. Grafton and K. Hussey (eds). Cambridge University Press.
O’Donnell, M. and B. Colby. 2009. Dry-Year Water Supply Reliability Contracts: A Tool for Water Managers. University of Arizona, Department of Agricultural and Resource Economics.
O’Donnell, M. and B. Colby. 2009. Water Auction Design for Supply Reliability: Design, Implementation, and Evaluation. University of Arizona, Department of Agricultural and Resource Economics.