Risk/return analysis of irrigation system design and operating rules

Graduation date: 1983A model was developed to simulate winter wheat production on\ud irrigated farmland similar to that found near Hermiston, Oregon. The\ud simulated farm is irrigated with a side roll sprinkler system. A well\ud is located adjacent to the wheat field and the water is delivered by\ud an electrically powered pump. The major components of the model are:\ud 1. The soil moisture component which estimates daily soil\ud moisture level. The soil moisture level is a function\ud of daily precipitation, daily irrigation and daily evapotranspiration.\ud Evapotranspiration is calculated as a\ud function of measured pan evaporation, wheat plant stage\ud of development and the soil moisture level.\ud 2. The irrigation component which schedules daily irrigation\ud based on the decision strategies supplied by the model\ud user. There are three major parts of each strategy, the\ud irrigation system design, the set time in hours and the\ud soil moisture level that initiates irrigation.\ud 3. The yield component of the model which estimates\ud wheat grain yield as a function of daily temperature,\ud daily soil moisture, and stage of plant growth. The\ud scheduling of irrigation will create variability in the\ud soil moisture level across the field. This variability\ud of soil moisture is incorporated in the yield component.\ud 4. The risk/returns component which calculates the net returns\ud and utility. Utility is equal to the average net return\ud minus the standard deviation weighted by a risk aversion\ud factor.\ud Wheat production was simulated for 19 years of daily weather data\ud from the Hermiston Agricultural Experiment Station from 1963-1981.\ud Several strategies were compared. The comparisons were made of the\ud yields, water use, irrigation costs, net returns, risk and utility of\ud the various strategies. The strategies were ranked according to maximum\ud utility.\ud The results indicated that designing irrigation systems for maximum\ud yields did not result in the highest utility. The optimum strategies\ud were those that initiated irrigation at a low level of soil moisture depletion\ud and used a system with a relatively lower capital investment.\ud The average annualized investment cost f or the five strategies with the\ud highest yields was $76.43 per acre. The annualized investment cost for\ud the five strategies with the highest utility was $57.54 per acre. The\ud difference in average utility between the two groups was $19.37 per acre.\ud The strategy with the highest yield had a utility level of $295.77 per\ud acre. The strategy with the highest utility had a utility level of $337.12\ud per acre. The analysis included only those costs associated with irrigation.\ud Utility was more sensitive to labor costs and water charges than\ud to the cost of energy and interest rates. The level of risk aversion\ud made very little difference in the relative level of utility for the\ud different strategies. If the moisture holding capacity of the soil was\ud reduced then the level of risk aversion made a bigger difference in the\ud relative level of utility