Real Options and Urban Water Resource Planning in Australia – WSAA Occasional Paper No 20
WSAA Occasional Paper No 20
WSAA commends the use of real options analysis as a very useful evaluation tool for the urban water industry. The use of real options analysis can provide powerful insights in risk management of uncertainties such as climate change. However, like all tools, it is no substitute for decision making. In addition, because its use may suggest optimal strategies that delay undertaking significant investments, it emphasises the importance of engaging the community in the process of considering major investments as was done by Gold Coast Water in its recent “Waterfuture” project.