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Policy and governance responses to the water-energy nexus
challenge
Kathleen Dominique, Environmental Economist, OECD
Water and energy scenarios
Water demand to increase by 55% by 2050
Global water demand, baseline 2000 and 2050

Source: OECD (2012), OECD Environment...
Human and economic costs of a changing climate:
uncertain future for freshwater
Change in annual temperature from 1990-205...
Outlook for water requirements for energy production
Global water use for energy production by scenario

Source: IEA (2012...
Outlook for water requirements for energy production
Global water use for energy production in the New Policies Scenario b...
Projected shifts in water-intensity of energy production

Source: IEA (2012), IEA World Energy Outlook, Chapter 17 “Water ...
Regional stress points: the example of China
Renewable water resources per capita and distribution of water-intensive ener...
Policy and governance responses
Improving coherence between water and energy policies
Strong water-energy linkages, yet often incoherent policies settings...
Improving coherence between water and energy
Various technological options impact water and energy policy objectives in
di...
Approaches to enhancing policy coherence
Exploiting win-wins
•
•

Pursuing multiple policy objectives at the same time
Exa...
Policy options to improve incentives and information
Robust water resource allocation
• To promote efficient, flexible, eq...
Governance challenges for water-energy coherence
Multiple institutional gaps
• Lack of institutional incentives
• Lack of ...
Improving governance and partnerships
Efforts to better co-ordinate water and energy policies,
examples of good practice:
...
Thank you. Questions?
References
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
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OECD (2012) Environmental Outlook to 2050: The consequences of inaction.
IEA (...
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Policy and governance responses to the water-energy nexus challenge by Kathleen Dominique, Environmental Economist, OECD

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Presentation on 'Policy and governance responses to the water-energy nexus challenge' by Kathleen Dominique, Environmental Economist, OECD, at 2014 UN-Water Annual International Zaragoza Conference. Preparing for World Water Day 2014: Partnerships for improving water and energy access, efficiency and sustainability. 13-16 January 2014

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Policy and governance responses to the water-energy nexus challenge by Kathleen Dominique, Environmental Economist, OECD

  1. 1. Policy and governance responses to the water-energy nexus challenge Kathleen Dominique, Environmental Economist, OECD
  2. 2. Water and energy scenarios
  3. 3. Water demand to increase by 55% by 2050 Global water demand, baseline 2000 and 2050 Source: OECD (2012), OECD Environmental Outlook to 2050; output from IMAGE
  4. 4. Human and economic costs of a changing climate: uncertain future for freshwater Change in annual temperature from 1990-2050 Source: OECD (2012), OECD Environmental Outlook to 2050; output from IMAGE
  5. 5. Outlook for water requirements for energy production Global water use for energy production by scenario Source: IEA (2012), IEA World Energy Outlook, Chapter 17 “Water for Energy”.
  6. 6. Outlook for water requirements for energy production Global water use for energy production in the New Policies Scenario by fuel and power generation type Source: IEA (2012), IEA World Energy Outlook, Chapter 17 “Water for Energy”.
  7. 7. Projected shifts in water-intensity of energy production Source: IEA (2012), IEA World Energy Outlook, Chapter 17 “Water for Energy”.
  8. 8. Regional stress points: the example of China Renewable water resources per capita and distribution of water-intensive energy production by type in China Source: IEA (2012), IEA World Energy Outlook, Chapter 17 “Water for Energy”.
  9. 9. Policy and governance responses
  10. 10. Improving coherence between water and energy policies Strong water-energy linkages, yet often incoherent policies settings Improved coherence requires meeting multiple policy objectives for water and energy • Improving water security (managing risks of “too little”, “too much”, “too polluted” water and ensuring resilience of freshwater ecosystems) • Increasing energy security • Mitigating and adapting to climate change Pursuing policy objectives independently often leads to incoherence (“waterblind” energy policies, “energy-blind” water policies)
  11. 11. Improving coherence between water and energy Various technological options impact water and energy policy objectives in different ways • • • • Help achievement objective(s) Hinder achievement of objective(s) Require trade-offs among objective(s) No appreciable impact on objective(s) “Win-win” technological options for both water and energy • E.g. low-flow fixtures, energy efficient appliances Trade-offs required for water and energy • E.g. irrigated biofuels, groundwater pumping
  12. 12. Approaches to enhancing policy coherence Exploiting win-wins • • Pursuing multiple policy objectives at the same time Examples: increasing water and energy efficiency; lowering water consumption through conservation, labelling of water-efficient appliances, etc. (Singapore) Avoiding conflicts • • Pursuing one policy objective without undermining others Examples: Requiring solar hot water systems on new buildings (Israel); use of waste heat from thermoelectric power plants to desalinate seawater to produce reliable drinking water (Middle East) Managing trade-offs • • Minimising negative impacts on other policies Examples: Recycling effluent from biorefineries to reduce negative impacts on freshwater ecosystems (Brazil); Co-ordination between policies for water allocation and energy explicitly (Israel).
  13. 13. Policy options to improve incentives and information Robust water resource allocation • To promote efficient, flexible, equitable risk sharing among water users Remove environmentally-harmful subsidies • For example, subsidies for energy use that exacerbate groundwater pumping Make better use of economic instruments • E.g. water pricing, abstraction charges, pollution charges Generate better data to inform policy decisions
  14. 14. Governance challenges for water-energy coherence Multiple institutional gaps • Lack of institutional incentives • Lack of platforms/ governance mechanisms to manage trade-offs • Interference of lobbies • Absence of strategic planning and sequencing decisions • Asymmetry of information and resources among institutions • Intense competition between different ministries and public agencies
  15. 15. Improving governance and partnerships Efforts to better co-ordinate water and energy policies, examples of good practice: • Brazil: to limit negative impact on freshwater ecosystems, legal framework requires previous authorisation from ANA for concessions to exploit hydropower potential. • Spain: the National Water Council includes representatives from the energy sector. • England and Wales: Environment Agency working with the Energy Saving Trust to develop policy to reduce hot water use in the home. • Australia: researchers have created the Climate-Energy-Water Links project to add the energy dimension to water resources planning and policies.
  16. 16. Thank you. Questions? References      OECD (2012) Environmental Outlook to 2050: The consequences of inaction. IEA (2012) World Energy Outlook, Chapter 17 “Water for energy”. IEA (2012) Golden Rules for a Golden Age of Gas. OECD (2013) Water Security for Better Lives. OECD (2013) Water and Climate Change Adaptation: Policies to Navigate Uncharted Waters.  OECD (2011) Water Governance in OECD Countries: A Multilevel Approach  OECD work on water: www.oecd.org/water Contacts Kathleen.Dominique@oecd.org (OECD, Water allocation; water and climate change) Matthew.Frank@iea.org (IEA, Water for energy), Aziza.Akhmouch@oecd.org (OECD, Water governance)

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