Annual operations and planning encompasses a wide range of basic water utility activities. Generally, these activities are designed to deliver short-term results and consist of managing existing water resources, matching water supply to water demand on a daily basis, development and maintenance of system infrastructure, and managing the utility’s assets and finances. Many of these activities will be affected by climate change impacts, such as changes in water supply, changes in water demand, and sea-level rise. Water utility managers will need to adjust their annual operations and planning to address these challenges. To do this, water resource managers must ask two fundamental questions about their current annual operations and planning. First, can they sufficiently handle projected climate impacts? Second, what will be the economic and ecological costs of these impacts?

To ensure successful adaptation, water utility managers should factor climate change impacts into their annual operations and planning in a timely and dynamic manner. Water utility managers can begin to adapt annual operations and planning to climate change by increasing operational flexibility. Annual operating plans (AOPs) can be enhanced to include multiple runoff scenarios based on both current and projected runoff patterns. Changes in runoff, especially those resulting from a reduction in snowpack and earlier spring snowmelt, will cause significant changes in the timing of reservoir inflow. This will require alterations in current reservoir operations.

The AOPs should also be expanded to include scenarios involving rapid, temporary changes in water quality due to greater precipitation intensity, higher storm surges, and prolonged heat events. Improved coordination with local governments and other water resource managers will also help water utilities successfully adapt their annual operations and planning to climate change.

Another adaptation method that may be appropriate for inclusion in annual operations and planning is improvement of water use efficiency. Unfortunately, there are many disincentives preventing water utilities from implementing this adaptation technique, including price subsidies and distortions, leading to the public seeing water as a “public good.” Despite these disincentives, making improvements in water efficiency as part of utility operations planning can help mitigate future supply issues. As part of an overall effort to enhance utility operational flexibility, annual operations and planning may also address development of customer rebate programs for high-efficiency fixtures and other water saving devices.

Water supply can also be made more resilient through changing operating policies related to water delivery. For example, water resource managers in California have coordinated the operation of several dams with surface water and groundwater supplies to use surface water during wet periods, thus preserving groundwater for drier periods. This helps ensure a more even water supply.

Overall, water utility managers must adapt their annual operations and planning to address potential climate change impacts. To do this, water utility managers are advised to make their planning and operations more flexible, improve their coordination with local governments, and include provisions to improve water use efficiency.