ABSTRACT.The purpose of this paper is to present and discuss a procedure for finding an optimal staging plan for implementing a multi‐basin water resource system‐a system that must meet, with tolerable shortages, pre‐specified but highly variable demands for water that increase over time‐a system such as the proposed Texas Water System.The paper stresses that, in the past, planners have paid little attention to quantifying explicitly the impact that uncertainty has on the decision process, and in that context, presents a means for explicitly evaluating the impact that uncertainty has on finding and evaluating the performance of the optimal and several alternate staging plans. The procedure presented evaluates the impact that uncertainty, in both the hydrologic and the economic variables, has on the decisions that need to be made.The decisions requiring resolution are (1) which of an over‐specified set of facilities should be constructed, (2) how large each of the facilities should be at various points in time, and (3) how should the system be operated so as to minimize the capital plus operational costs over the planni
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