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Abstract The Ensemble Streamflow Prediction (ESP) framework combines a probabilistic forecast structure with process‐based models for water supply predictions. However, process‐based models require computationally intensive parameter estimation, increasing uncertainties and limiting usability. Motivated by the strong performance of deep learning models, we seek to assess whether the Long Short‐Term Memory (LSTM) model can provide skillful forecasts and replace process‐based models within the ESP framework. Given challenges inimplicitlycapturing snowpack dynamics within LSTMs for streamflow prediction, we also evaluated the added skill ofexplicitlyincorporating snowpack information to improve hydrologic memory representation. LSTM‐ESPs were evaluated under four different scenarios: one excluding snow and three including snow with varied snowpack representations. The LSTM models were trained using information from 664 GAGES‐II basins during WY1983–2000. During a testing period, WY2001–2010, 80% of basins exhibited Nash‐Sutcliffe Efficiency (NSE) above 0.5 with a median NSE of around 0.70, indicating satisfactory utility in simulating seasonal water supply. LSTM‐ESP forecasts were then tested during WY2011–2020 over 76 western US basins with operational Natural Resources Conservation Services (NRCS) forecasts. A key finding is that in high snow regions, LSTM‐ESP forecasts using simplified ablation assumptions performed worse than those excluding snow, highlighting that snow data do not consistently improve LSTM‐ESP performance. However, LSTM‐ESP forecasts that explicitly incorporated past years' snow accumulation and ablation performed comparably to NRCS forecasts and better than forecasts excluding snow entirely. Overall, integrating deep learning within an ESP framework shows promise and highlights important considerations for including snowpack information in forecasting. 

In many parts of the world including the western United States, the allocation of water is governed by complex water laws that dictate who receives water, how much they receive, and when. Because these rules are generally based on the seniority of water rights, they are not necessarily focused on maximizing economic value across the entire economy. The maximization of value from water use economy-wide is a complex optimization problem that must explicitly consider each user’s water demand, willingness to pay (WTP) function, and the feedbacks among users in a coupled natural-human system model. In this study, we distill these complexities into a simple MATLAB® model developed to represent a two-user economy with water-dependent sectors representative of agriculture and industry. We feed the model with realistic values of relative water use, relative willingness to pay, and return flows to explore the relationships among these factors in water-limited systems. We find that the total economic value generated from water-dependent users depends primarily on the total water available in the system. However, for a given volume of water available, economic value is not necessarily maximized when all the water is appropriated to the user with the highest WTP. Rather, total economic value depends on the amount of water available, the relative WTP between the two users, and on the return flows generated from each sector’s water use. While our simple two-user model is a significant abstraction of the complexities inherent in natural systems, our study provides important insights into the coupled natural-human system dynamics of water allocation and use in water-limited environments.