Presented by: Raffaello Cervigni SESSION VI: PLENARY –PILLARS FOR NATIONAL ADAPTATION PLANS The session will examine a few case studies of how a particular issue of prime importance for a country can be the main entry point or pillar of the adaptation work, after which all other issues would then be considered. Three examples will be covered. Madagascar is a well-known centre of biological biodiversity. Addressing climate change through adaptation must consider the dynamics of this biodiversity including closely related stress factors such as poverty, pressure on land due to deforestation, shifting viability of the main cash crops when climatic conditions change, etc. Two other examples are on taking a regional approach to the assessment and development of adaptation responses in the context of hydro-energy. In other cases, a focus on community-based adaptation has been very successful, as is the case for Bangladesh.

1. SUMMARY OF FINDINGS AND OPTIONS FOR NEXT STEPS
JULY 2016
Raffaello Cervigni
Lead Environmental Economist
Regional Coordinator, Climate Change
Africa Region, The World Bank
Enhancing the Climate Resilience
of Africa’s Infrastructure

2. Outline
2
1. ECRAI: a program to understand the issues
Water, power sector
Planning level analysis
Project level analysis
 Road transport
Selected PIDA corridors
Selected national master plans
2. AFRI-RES: a new initiative to address the challenge
Introduced today
More discussion in the rest of the week

3. Africa needs to close the capital asset gap…
3

4. ..but much of the required long-lived
investment is climate sensitive
4

5. The issue is a major one in Africa: major
investments planned..
5
Sector
Target by
2040
Modern highways 37,300 km
Hydroelectric power generation 54,150 MW
Interconnecting power lines 16,500 km
New water storage capacity 20,101 hm3
PIDA long term targets

6. ..in the context of a very different
climate in the future..
Return to main slide show
Data refer to the Volta river basin

7. ..with increasing uncertainty
on direction and magnitude of change
7

8. Objectives of ECRAI
Overall: Strengthen the analytical base for investments in
Africa’s infrastructure under a future uncertain climate;
specifically:
1. Estimate the impacts of climate change on the performance of a
subset of infrastructure over a range of climate scenarios
2. Develop and test a framework for the planning and design of
infrastructure investment that can be “robust” over a wide range of
climate outcomes;
3. Enhance the “investment readiness” of African countries to use
climate finance to increase climate resilience of infrastructure

9. Power and water sectors

10. Summary of findings
10
1. Climate change has large effects on infrastructure
performance; ignoring it may lead to significant “regrets”
2. Despite uncertainty, it is possible to plan infrastructure
development so as to reduce regrets
3. There will be cost increases and cost savings; the benefits
in terms of reduced risk outweigh the cost increase
4. Climate resilience is a new challenge, but is manageable
5. Adaptation reflects choices that countries and regional
organizations will need to make themselves

11. Seven River Basins Four Power Pools
Scope of the water and energy analysis

12. Two tracks of analysis
 Track 1: coarser scale
(basins and power pools)
 Emphasis on planning,
trade-offs among policy
objectives
 Track 2: specific
investments scale
 Emphasis on project
design options

13. A representative range of case studies
13
1. Lower Fufu Hydropower Project
(Zambezi River Basin, Malawi)
2. Polihali Dam and Conveyance
Project (Orange River Basin,
Lesotho)
3. Pwalugu Multi-purpose Dam
Project (Volta River Basin,
Ghana)
4. Batoka Gorge Hydropower
Project (Zambezi River Basin,
Zambia/Zimbabwe)
5. Mwache Dam and Reservoir
Project (Kwale District, Kenya)

14. The approach in 4 steps
14
A. Reference scenario: by 2030, what
infrastructure, where, when, what performance
(MW, Hectares, etc.)
B. Impacts: how performance will be affected under
100+ climate scenarios (no adaptation)
C. Adaptation
 Perfect foresight adaptation: assume you knew in advance
the climate, how would you modify plans ex-ante
 Robust adaptation: what are the planning choices that
deliver performance in as many climate scenarios as possible

15. The reference scenario:
a program of massive investment
15

16. Modeling the interaction of climate, hydrology,
energy and irrigation systems
16

17. MESSAGE:
CAN’T IGNORE CLIMATE CHANGE
17
Impacts

18. Large impacts on physical performance..
18
Changes in physical performance of hydropower and irrigation under climate change (2015 to 2050) in the
Congo, Orange and Zambezi basins

19. ..and thus on economic performance..
19
Change in present value of revenues from Hydropower and irrigation for SAPP Basins, Absent Adaptation

20. ..across almost all basins
20
Changes in hydropower revenues from climate change (present value 2015 to 2050)

21. Large impacts on power consumers..
21
Cumulative consumer expenditure on electricity (no climate change case=100%)

22. ..and on agriculture imports
22
Cumulative expenditure on agriculture imports (no climate change case=100)

23. MESSAGE:
ADAPTATION IS POSSIBLE,
DESPITE UNCERTAINTY
23
Adaptation

24. Six adaptation levers
24
Decision Variable Range of Lever Modification
Basin Level
Planned turbine capacity 50%, -25%, 0%, +25%, +50%
Planned reservoir storage -50% or -25%.
Mean conveyance
irrigation efficiency
Improved in increments of 10% from a baseline
assumption of 75%, to 85% or 95%.
Farm Level
Planned irrigated area adjusted on a continuous basis from -50% to
+50%.
Mean deficit irrigation (of
water requirements)
deficit irrigation of 30%, 20%, 10%, or 0%.
Mean field-level irrigation
efficiency
60% in the Reference case, can be increased to
70% or 80%
Annual crop imports (of
total production)
Stop-gap measure

25. Be careful when you move the levers!
25
Damage from not adapting or mis-adapting hydropower expansion plans

26. Smart adaptation can lead to
$ billion of benefits..
26
Zambezi: reduction in regrets from adaptation
No adaptation Smart adaptationRushed adaptation

27. ..Across almost all the basins
27
Reduced and residual regrets from the mini-max adaptation strategy

28. MESSAGE:
YES, IT IS
28
Is adaptation worthwhile?

29. There will be both cost increases and savings..
29
Incremental cost of mini-max adaptation in hydropower

30. ..but even ignoring savings, adaptation is worth it
30
Benefit/ cost ratio of mini-max adaptation in hydropower (only considering cost increases)

31. Transport sector

32. Take home messages
1. Africa’s road network will be heavily affected by
climate change
2. There is a strong case for adaptation, but is should
be assessed, case by case, in relation to:
Savings in lifetime expenditure on road assets
 Reduction in disruption time
3. There is a need to increase capacity to integrate
climate in the road transport sector, at the policy,
program and project level

33. Domain of analysis: PIDA corridors..
33

34. ..and national master plans
34

35. Reactive Proactive adaptation
 Business as usual
building norms,
construction costs
 Change in maintenance
cost (compared to not-
climate change case)
 Disruption of network
connectivity
 Estimate of down-time
 No estimate of monetary cost
 Improved building
norms
 Higher construction
costs
 Prospects for reduced
disruptions
 Possible regrets
35
Two responses to climate change

36. Ignoring climate change leads to large costs…
36
Reactive response costs for the PIDA+ network, 2015-50

37. ..and to significant time losses
Cumulative Disruption for the PIDA+ network With
Reactive Response to Climate Change, 2015-50 (million
days)
0
10
20
30
40
50
60
70
80
90
100
Temperature Precipitation Flooding
TotalDisruptioninMillionDays
Best Climate Historic Worst Climate

38. Adaptation
38
 Temperature
 Dense seals
 Bitumen binders with
higher softening points
 Precipitation
 Wider paved shoulders
 Increased base thickness
or quality
 Flooding
 Increased culvert size

39. Adaptation may not always be justified
on financial grounds…
39

40. ..but the case becomes stronger when the time
saving benefits are considered
40
Flooding stressor, PIDA+ paved roads

41. There will be higher construction costs
$-
$2
$4
$6
$8
$10
$12
$14
$16
$18
2015-2030 2031-2050
Baseline cost
(billions of 2015 USD)
95th percentile
75th percentile
Mean (labeled;
2015 USD)
25th percentile
5th percentile
$14.5 billion
$4.0 billion
Baseline cost:
$12.8 billion
Baseline cost:
$3.5 billion
Cumulative capital costs for adapting PIDA corridors

42. What have we learned from ECRAI?
42
To move the agenda forward we need:
1) An accepted, common framework of
analysis
2) A range of tools; better data
3) Concrete applications – and early in the
project cycle

43. AFRICA CLIMATE RESILIENT
INVESTMENT FACILITY
43
The proposed solution

44. The facility is part of the World Bank climate
business plan for Africa
44

45. Recapping the rationale
45
1. Long-lived investments in Africa are vulnerable to climate
variability and change
• Without suitable planning and design, these investments will under-
perform, with negative consequences on the continent’s social and
economic development
2. The data, knowledge and technical capacity to plan and
design climate-resilient investments are inadequate
3. There are economies of scale in strengthening knowledge
and capacity through regional and sub-regional
organizations
4. Following different approaches in financing investments
in the same river basin or road network may result
in sub-optimal outcomes (or mal-adaptation)

46. Objective
46
Strengthen the capacity of African institutions
(including National Governments, River basin
organizations, Regional Economic Communities,
Power Pools, etc) to plan, design, and implement
climate-resilient investments in selected sectors
[integrating climate risks into design of World
Bank-financed projects]

47. Why a new entity?
47
Project
developers
Financiers
Climate science
community
Facility

48. Activities
48
 Open data and knowledge platform
 (climate projections, bio-physical/ economic models, etc)
 Expert services
 Development of guidelines
 Compilation of good practices
 On-demand advisory services
 Assistance in TORs preparation
 Quality assurance on technical reports

49. Who will do it?
49
Peer
reviewers
.
.
Leadership
group
(World Bank,
UNECA, AUC)

50. Please look us up on-line!
50
 Enhancing the Climate Resilience of Africa's
Infrastructure (Full Report)
https://openknowledge.worldbank.org/handle/1098
6/21875
 Africa Climate-Resilient Investment Facility
http://www.worldbank.org/en/news/feature/2015/1
2/09/a-plan-to-spur-climate-resilient-
infrastructure-in-africa

51. Annex slides

52. Starting points: Africa Infrastructure
Country Diagnostic (AICD)…
 Comprehensive overview of
current infrastructure status,
policy, institutional and financial
challenges
 Concludes that Africa needs to
spend US$93bn pa to catch-up
on infrastructure with rest of
developing world
 Estimates made under a “no
climate change” presumption

53. US/ Europe experts Africa experts
• Stockholm Environment Instit./ US
• Rand Corporation
• Royal Institute of Technology –
Sweden
• Massachusetts Institute of
Technology
• University of Massachusetts
• Industrial Economics, inc.
• Nile Basin Initiative (Uganda)
• International Institute for Water
and the Environment (Burkina
Faso)
• Rhodes University (South Africa)
• University of Cape Town (South
Africa)
The study team

54. Magnitude of impacts is
sensitive to discount rates
0%
10%
5%
3%
7%
Dryer climates Wetter climates
PV of hydropower and irrigation revenues in SAPP river basins

55. In principle adaptation is attractive…
55
Gains from perfect foresight adaptation in hydropower

56. Why does the World Bank care?
56
Commitments under IDA17:
 Screen all new IDA operations for short- and long-
term climate change and disaster risks and, where
risks exist, integrate appropriate resilience
measures;
 Scale up support to IDA countries to develop and
implement country-led, multi-sectoral plans and
investments for managing climate and disaster risk
in development in at least 25 additional IDA
countries

57. What does it take to implement the approach?
57
1. A set of downscaled climate projections
2. A hydrologic model of the relevant region
3. A project design and cost model

58. Recommendations
58
1. Develop technical guidelines on the integration of
climate change in the planning and design of
infrastructure in climate-sensitive sectors.
2. Promote an open-data knowledge repository for
climate resilient infrastructure development
3. Establish an Africa climate resilience investment
facility
4. Launch training programs for climate-resilient
infrastructure professionals
5. Set up an observatory on climate resilient
infrastructure development in Africa

59. Choosing a mini-max adaptation strategy..
59
Zambezi basin: Regrets from alternative design options

60. A final KEY caveat
60
 Report is no substitute for basin- or project
specific analysis
 Adaptation depends crucially on:
 attitudes towards risks
 time preference
 relative priority of physical vs economic performance of
infrastructure
 These are choices that countries and
regional organizations will need to make
themselves