A water resource system of up to four reservoirs is optimized. The planning problem is solved by a two-stage optimization procedure. At the first stage the optimal value of irrigation area and installed power capacity of system are determined subject to allowed deficits. The allowed deficits are given for irrigation and total primary energy production. At the second stage the multistate problem of optimal control is solved applying dynamic programming. The criterion for optimal control is maximum benefit. At the second stage the value of irrigation area and installed power are modified subject to allowed deficit, and the second stage is run again, until the computed deficits become smaller then or equal to the allowed.