Economic analysis of canal lining

Lining an existing canal is justified when the yearly benefit exceeds the yearly cost of the lining. The analysis compares cost and benefit on an annual basis.

Annual cost of lining

$$C = (\text{Initial cost of lining})\times(i + \text{depreciation}) + \text{Extra maintenance}$$

• Initial cost: lining cost per metre $\times$ length (materials, labour, subgrade preparation, joints).
• Interest at the annual rate $i$, and depreciation (sinking fund) over the life of the lining (say 30-40 years for concrete).

Annual benefits

1. Saving of water by reduced seepage – seepage loss before lining minus seepage loss after lining (often 70-80% is saved). The value of the saved water is its irrigation worth, i.e. the extra crop it can produce on additional area.
2. Increased command area from the saved water.
3. Reduction in the cost of maintenance, silt clearance and weed control.
4. Saving in land and structures: the higher velocity allows a smaller cross-section, with less excavation and embankment.
5. Prevention of waterlogging, and the cost of drainage avoided.
6. Fewer breaches and easier operation (higher permissible velocity, more reliable supply).

Procedure

1. Estimate the unlined seepage loss $=$ (seepage rate, m³/s per million m² of wetted area) $\times P\,L$, using the Punjab or Davis-Wilson formulas; estimate the lined loss in the same way.
2. Water saved $=$ the difference, converted to hectares of extra irrigation using the duty $D$ (ha per m³/s).
3. Annual benefit $=$ (extra area $\times$ net return per ha) $+$ maintenance savings $+$ other savings.
4. Compute the annual cost of lining (above).
5. Benefit-cost ratio:

$$\text{B/C} = \frac{\text{Annual benefit}}{\text{Annual cost}} \ge 1$$

The lining is economical if $B/C > 1$. The break-even cost of lining per square metre is the cost at which $B/C = 1$. The type of lining (concrete, brick, soil-cement, plastic membrane) is chosen as the cheapest one that gives an acceptable benefit.