Water markets follow trend set by carbon markets

Posted by: Saving Water SA (Cape Town, South Africa) – partnered with Water Rhapsody conservation systems – 11 May 2010

By: Christo Marais – Working for Water: Natural Resource Management Programmes

It has often been said that environmentalists are “underselling the value of their products” with the result that their arguments are not being heard in mainstream economic debates. Historically, we have not been willing to put a value to biodiversity and environmental services. How do we value nature and what is the value of nature, they have argued. During the last few decades though, this has begun to change.

Pezula's rehabilitation programme has cleared over 300ha of alien trees and vegetation

With the advent of global climate change and the need for carbon sequestration and mitigation measures, the global face of natural resource management has changed. Although not as well-developed internationally, water markets are following the trend set by the carbon market.

So often when water resource management is being considered, the management options focus on augmentation and engineering solutions to water quantity and quality rather than the full spectrum of resource management options.

The impact of land management and the management of natural water resources such as wetlands, rivers and catchments is seldom seriously considered. For example, the drying up of our catchments, degradation and transformation of our wetlands, river banks and floodplains impacts on the proper functioning of these water resource systems by decreasing the amount of water absorbed into the systems and increasing the intensity of floods.

Furthermore, when invasive alien trees out-compete natural vegetation in these areas, this results not only in changing the flows, but also causes major water losses due to significantly increased water use.

This has a direct impact on the availability of water in our rivers, aquifers and even on the yield of dams.

A recent study has shown that 4 percent of utilisable water, or registered water use, is being lost due to invasive alien trees in our catchments, wetlands, river banks and floodplains. If left unchecked, this could increase to more than 16 percent within a relatively short period of time.

This is where partnerships between the government and business are needed to optimise the delivery of water.

The longer water can be “stored” naturally through catchments and ground water management, the less expensive supply of this water should be.

Generally, water is extracted from four sources: large dams, small dams (farm dams), directly from rivers – also referred to as “run off river extraction” – and ground sources.

Good infiltration not only increases base flows (non-flood flows) to maintain the levels of dams during the dry season, but significantly increases water security from aquifers and river extraction.

So why create water infrastructure if one can simply improve land management? The answer is simple: the implementation of optimum catchment management practices is simply not adequate to secure the volumes needed by the local economy.

Whether environmentalists like it or not, sometimes water infrastructure is needed. In order to replace these low flows and improve water quality, infrastructure needs to be created, and this comes at high costs. And so the answer lies in a combination of water conservation and demand management, optimum watershed management and well-planned water infrastructure.

For this reason, partnerships between business and the government should not only include the creation of new infrastructure; they should look at the full value chain, from watershed to tap.

The water sector and business must invest in watershed management to ensure that water is delivered to the point of extraction as cheaply as possible and not only in infrastructure.

To date, the government has spent billions of rands on watershed management through its Working for Water, Wetlands, Fire, Land and Landcare programmes. The government has also, through its Working for Water programme partnered with the WWF to develop the Water Neutral Programme. This innovative programme seeks to harness corporate support for the wise management of our water resources by encouraging corporate South Africa to be water neutral through a three-step process of: review, reduce and replenish.

It is time that business steps up to the plate, acknowledges the future impacts of climate change on our water resources and contributes to water conservation and demand, and watershed management.

Whether this happens through the formal water market or through corporate social investment programmes does not matter, as long as we all take hands and ensure the long-term security of our precious water supply. It makes business sense!

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