Risk‐based water resources planning is based on the premise that water managers should invest up to the point where the marginal benefit of risk reduction equals the marginal cost of achieving that benefit. However, this cost‐benefit approach may not guarantee robustness under uncertain future conditions, for instance under climatic changes. In this paper, we expand risk‐based decision analysis to explore possible ways of enhancing robustness in engineered water resources systems under different risk attitudes. Risk is measured as the expected annual cost of water use restrictions, while robustness is interpreted in the decision‐theoretic sense as the ability of a water resource system to maintain performance—expressed as a tolerable risk of water use restrictions—under a wide range of possible future conditions. Linking risk attitudes with robustness allows stakeholders to explicitly trade‐off incremental increases in robustness with investment costs for a given level of risk. We illustrate the framework through a case study of London's water supply system using state‐of‐the ‐art regional climate simulations to inform the estimation of risk and robustness.

We present a risk‐based approach for incorporating nonstationary probabilistic climate projections into long‐term water resources planning. The proposed methodology uses nonstationary synthetic time series of future climates obtained via a stochastic weather generator based on the UK Climate Projections (UKCP09) to construct a probability distribution of the frequency of water shortages in the future. The UKCP09 projections extend well beyond the range of current hydrological variability, providing the basis for testing the robustness of water resources management plans to future climate‐related uncertainties. The nonstationary nature of the projections combined with the stochastic simulation approach allows for extensive sampling of climatic variability conditioned on climate model outputs. The probability of exceeding planned frequencies of water shortages of varying severity (defined as Levels of Service for the water supply utility company) is used as a risk metric for water resources planning. Different sources of uncertainty, including demand‐side uncertainties, are considered simultaneously and their impact on the risk metric is evaluated. Supply‐side and demand‐side management strategies can be compared based on how cost‐effective they are at reducing risks to acceptable levels. A case study based on a water supply system in London (UK) is presented to illustrate the methodology. Results indicate an increase in the probability of exceeding the planned Levels of Service across the planning horizon. Under a 1% per annum population growth scenario, the probability of exceeding the planned Levels of Service is as high as 0.5 by 2040. The case study also illustrates how a combination of supply and demand management options may be required to reduce the risk of water shortages.

This paper discusses how epistemic uncertainties are currently considered in the most widely occurring natural hazard areas, including floods, landslides and debris flows, dam safety, droughts, earthquakes, tsunamis, volcanic ash clouds and pyroclastic flows, and wind storms. Our aim is to provide an overview of the types of epistemic uncertainty in the analysis of these natural hazards and to discuss how they have been treated so far to bring out some commonalities and differences. The breadth of our study makes it difficult to go into great detail on each aspect covered here; hence the focus lies on providing an overview and on citing key literature. We find that in current probabilistic approaches to the problem, uncertainties are all too often treated as if, at some fundamental level, they are aleatory in nature. This can be a tempting choice when knowledge of more complex structures is difficult to determine but not acknowledging the epistemic nature of many sources of uncertainty will compromise any risk analysis. We do not imply that probabilistic uncertainty estimation necessarily ignores the epistemic nature of uncertainties in natural hazards; expert elicitation for example can be set within a probabilistic framework to do just that. However, we suggest that the use of simple aleatory distributional models, common in current practice, will underestimate the potential variability in assessing hazards, consequences, and risks. A commonality across all approaches is that every analysis is necessarily conditional on the assumptions made about the nature of the sources of epistemic uncertainty. It is therefore important to record the assumptions made and to evaluate their impact on the uncertainty estimate. Additional guidelines for good practice based on this review are suggested in the companion paper (Part 2).