Transcript PowerPoint - Water Droplets – Mike Young

The Environment Institute
Where ideas grow
Securing our Water Supplies
Mike Young
Executive Director, The Environment Institute
The Environment Institute
Millennium Development Goals
• 3,900 children under 5 die every day from
water supply & sanitation related diseases
• MDG to halve the number people without
access to drinking water and sanitation by
2015
– Drinking water goal expected to be met
– Sanitation goal will not be met
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Current global water scarcity
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After Molden 2007
Water stress = Opportunity for Australia
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Water
stressed
people!
By 2030 half the
world will live in
a water stressed
region
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After OECD 2009
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How big is the opportunity?
Water scarcity gap –
billions m3
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After 2030 Water Resources Group
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Clever green economies
• Reflect the full costs of resource use
• Water Storage
• Water Use
• Water Returned to Rivers, Aquifers, the Sea, etc.
• Commitment to prevent renewable resource depletion
• Promote the restoration of degraded environments.
• Recognise value ecosystem services
• In green economies, pricing matters
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General messages
1.
2.
3.
4.
5.
By 2030, over half the world’s population is expected to be living in a
water stressed region.
Failure to provide reliable access to water and sanitation services is one
of humankind’s greatest failings.
Demand is growing and supply costs rising.
Health and quality of many rivers and aquifers is declining. Restoration
is a non-trivial challenge!
The aggregate affect of climate change on water supplies is expected to
be negative.
–
6.
By 2030 child malnutrition is predicted to increase by 20%.
The rate of change and structural adjustment necessary to resolve
existing challenges and cope with the new ones expected as a result of
climate change and a larger more affluent global population is an order
of magnitude faster than has been achieved in recent times.
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Pricing arrangements
1. Lack of economic discipline is crowding out the
innovation and investment needed to solve water
scarcity and investment challenges.
2. This raises the cost of solving water supply problems
and decreases the rate of economic development.
3. In many cases, the poorest would be better off paying
the full cost of supply rather than exposing
themselves to the extremely high cost of obtaining
access to water from other sources.
4. The more targeted cross-subsidies are the better.
Blanket subsidies should be avoided.
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Australian investment mistakes
•
•
•
•
•
Grants to States to pay for desalination plants
Grants to “upgrade” irrigation systems
Restrictions on water trade
Restrictions on carry forward
Postage stamp pricing
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Australian water management innovations
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National
Competition
Policy
1993/94
Plus Cap
Single Title
to
Land with a
Water Licence
Water
Land
Tradable Right
Entitlement
Shares
in Perpetuity
Delivery Capacity
Shares
Bank-like
Allocations
Delivery Capacity
Allocations
Price
Use licences
with limits &
obligations
Salinity
Shares
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National
Water
Initiative
2004
Salinity
Allocations
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Returns to investment in entitlement
systems & trading
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After Bjornlund & Rossini 2007
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Water accounting 101
• River Murray
• Dredge in Oct 2002
• A few accounting flaws in our entitlements
– Forests
– Dams
– Groundwater
– Return flow
– Salinity interception
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Impact of adverse climate change
Users
Users
Users
Environment
Environment
Environment
River Flow
River Flow
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River Flow
Indicative template – regulated river systems
Volume of Water in the System
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Flood water
Volume of water available
15
Entitlements
Environment
with a
Environment
fully-specified
share
Water needed to
ensure conveyanceLife Impact The University of Adelaide
Shared Water
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Clever governance
1. Need for a much more disciplined approach to
the management and administration of water
resources.
– Independent expertise-based Authorities
2. Need processes and mechanisms that promote
change and structural adjustment.
3. Must be able to cope with sudden climatic shifts
and the rapid emergence of extreme water
scarcity.
4. Independent price regulators.
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Clever finance
1. There has been insufficient attention to the economic
scrutiny of proposals to invest in new infrastructure
and renew existing infrastructure.
2. Proposals need to take much greater account of likely
population shifts and vulnerability to climate
variability and change.
3. Costs will be less if parallel investments are made in
the development of mechanisms to enable
widespread use of market-based instruments.
4. Greater use of the private sector is possible.
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Financing investment (3 T’s)
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After Marin and OECD 2009
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Summary
• At the global level Australia is leading in water
policy
• But we are way behind where we should be in
this ever changing world
text
• Huge business opportunity if we get it right
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Where ideas grow
www.adelaide.edu.au/environment
www.myoung.net.au