Long-term water supply planning in an Australian coastal city: Dams or desalination?

• Interdisciplinary analysis of long term water supply planning incorporating economic, social and environmental variables.
• Comparison of dam and desalination costs
• Sensitivity of planning to social discount rate, water security index, population growth and scale of capital investment
• Over long term, desalination is a more cost effective supply augmentation alternative.

Water resource managers and planners are continually involved in defining and evaluating alternative policies to better meet changing water supply conditions and the expectations of society. To undertake such long-term water supply planning, this study developed a novel integrated system dynamics model to combine economic, social and scientific variables and considerations within the planning horizon. Extensive sensitivity analysis for these variables was considered in this long term water resource planning process. The analysis suggests that over a longer time horizon, desalination provides a more viable, cost effective and secure bulk water supply alternative when compared to building large rain-dependent dams.