An opportunity loss model for estimating the value of streamflow data for reservoir planning

Streamflow data have economic value because they are used for making decisions in water resources. By quantifying this value, hydrologists should find it much easier to overcome traditional obstacles to investment in streamflow data collection programmes. In this paper, an opportunity loss model is described which enables this to be done. The study has focused on evaluating typical benefits which may arise from more abundant data records for a specific purpose and, through this, provide further evidence which justifies investment in streamflow data collection activities. The specific purpose investigated is the development of reservoir capacity-reliability-yield relationship. Finally, it is argued that, while it is not uncommon for a streamgauging station to be project-specific, the data would invariably be used for other purposes and through these generate additional values. Considerations of such secondary values should make the whole idea of investment in streamflow data collection even more attractive economically. © 1996 Kluwer Academic Publishers.