Download Feasibility Study Models for Economic Analysis

Feasibility Study Models for Economic Analysis: Chiapas Water Fund
Several existing mathematical, hydrological, climate and agricultural models were used in
completing the economic analysis for the Chiapas Water Fund, while others were prepared,
improved and/or updated through this study, which could be readily applied elsewhere. A full
list of the models developed through this study is available in this document. Models described
below include: a regional sediment model, a model to estimate the useful life of dams, and a
model to estimate the economic losses in dams through sedimentation. Some of the models
used as input were climate change scenarios from the IPCC, models of crop yield from the
Mexican Agriculture Ministry (SAGARPA), and a model on Trap Efficiency of Reservoirs.
G. M. Brune Method: From the total amount of sediments that enter a dam through the
channels, only a fraction is captured and stored in the dam’s reservoir, while the rest of the
sediments overflow. The capacity of a reservoir to capture and retain sediments is defined as
retention efficiency (RE). The model thus makes use of the retention efficiency in order to
predict reservoir silting.
Brown Model: The C. B. Brown criterion determines a reservoir’s sediment retention efficiency
based on the following variables: catchment area, total reservoir capacity, runoff characteristics
and sediment type. Similar to the Brune model, this model also predicts reservoir silting over
time.
Sediment volume estimation for different return periods
To estimate the frequency of hydrological maximum values, a statistical distribution called
Gumbel (1958), or double exponential, was used; which is also known as the Type 1 (EV1)
extreme value distribution. This has been commonly used to evaluate extreme value
frequencies in Statistical Hydrology. The distribution predicts, for a given value (precipitation,
sediment, etc.), the expected maximum values in a time interval.
Soil erosion effects on rainfed corn yield
This model uses an array of parameters to establish a soil loss pattern with respect to the
impact on corn productivity. With information taken from the Hydrographic Watershed Water
Flow Simulator (SIATL for its acronym in Spanish) regarding different erosion degrees on a
municipal scale and hydrometric station measurements, surfaces reflecting soil loss intervals
were selected. One of the model’s limitations is that in the case of municipalities with two or
more degrees of erosion, the one with the highest surface percentage was selected. The
priority conservation sites for reducing erosion results from INIFAP revealed further
information about this topic. The distribution of 37 municipalities with rainfed corn crops with
varying degrees of erosion (very low, low, moderate and severe) was used to calculate potential
economic loss.
Model for the determination of expected loss in coffee crops due to natural disaster
susceptibility
With information regarding coffee crop yield in areas with different degrees of natural disaster
frequency, expected crop loss was calculated.
As regards the estimation of losses caused by natural disasters
A municipal per capita loss index, derived from natural disasters, was developed for coffee crop
areas.
Life-cycle expected value
As a tool to compare decisions between grey and green infrastructure, a life cycle expected
value model was used. The objective of this model is to minimize mitigation costs and maximize
net benefits from green and grey infrastructure interventions. It is very useful to obtain an
estimate of conservation measures, as well as to propose a method for investment orientation.
NOTE: The analysis covers corn and coffee crops because they are the region’s staple crops.