Policy uses of SEEAW: An Overview Glenn-Marie Lange Center for Economy, Environment and Society The Earth Institute at Columbia University SEEAW Training Course 17 November, 2006

Organization of Presentation Focus on sections of Chapter 9 A.Motivation for water accounts: linking economic data with water data for IWRM This will be addressed by Mr. Lenton B. Indicators and statistics for water management C. Water management and policy analysis

B. Indicators and statistics from the water accounts Overall Purpose: Demonstrate indicators that help understand and prioritize water-related problems Indicator groups : –Sources of pressure on water resources –Opportunities for improving water productivity and efficiency –Water pricing and incentives for water conservation –Sustainability: comparing water resources and use

B. Indicators and statistics from the water accounts B.1 Source of pressure on water resources: Macro trends in total water use, emissions, water use by natural source and purpose, etc. ‘Decoupling’ economic growth and water use, pollution Industry-level trends: indicators used for environmental-economic profiles Technology and driving forces: water intensity/productivity and total (domestic) water requirements to meet final demand International transport of water and pollution

National Trends: Decoupling Economic Growth & Water Use/Pollution Botswana: water use and economic Growth, Netherlands: water pollution and economic growth,

Environmental Economic Profiles for 2 highly polluting industries in Sweden, 1995

International transport of pollution: Share of pollution in rivers in the Netherlands originating abroad

B. Indicators and statistics from the water accounts B.2 Potential for increasing effective supply and improving water productivity Reducing system losses Increasing reuse of water and use of return flows B.3 Water pricing and incentives for water conservation Does price cover the full costs of production, or are some sectors subsidized? Is basic water affordable to all households B. 4 Sustainability: comparing water resources and water use

C. Water management and policy analysis Meeting future water demands –Projecting demand –Analyzing scenarios about different ways to meet future demands (infrastructure development, water conservation, changing economic structure…) Economic & social benefits from water policy reform Social & economic benefits, income generated directly and indirectly, optimization models Water pricing reform Costs and benefits from wastewater treatment Other issues such as ‘virtual water’ and the impact of international trade on water demand

Projecting future water demands Australia, 2050 How is this done? Economic models that include water use accounts Simplest models are Input-Output models More complex models include simulation, programming & CGE models

Benefits from Water Policy Reform: Pricing Reform Murray-Darling River Basin Australia Based on historical water use & price data, simulated impact on GDP of doubling water prices and the expected increases in water use efficiency (WUE) of 1-2%