IS DOMINANT USE MANAGEMENT COMPATIBLE WITH BASIN-WIDE ECONOMIC-EFFICIENCY

Managing reservoir systems for economic efficiency requires maximizing total economic benefits over all water uses, time periods, and locati ons. This paper presents results derived from a basin optimization mod el that solves both multiple use and dominant use management objective functions. Application of the model to New Mexico's Rio Chama basin f or the uses of river recreation, lake recreation, and hydropower indic ates a negligible difference in system benefits between managing for m ultiple use and for a dominant use. However, there is a substantial di fference in the distribution of water across reservoirs and economic b enefits across uses. Results suggest that in basins where nonconsumpti ve uses are dominant, managers may have more latitude than previously believed in managing for dominant uses while still meeting a larger ec onomic efficiency objective.