H179-05
Returns on investment in watershed interventions: water funds as science-policy-economy catalyzers
Tuesday, 15 December 2020: 10:16
Virtual
Boris F Ochoa-Tocachi1,2, Eric Ochoa-Tocachi3, Andrea Vera4, Rafael Osorio5, Paul Ochoa-Pérez2,6, Fabricio Rivera4, Daniel Tenelanda2, Diego Ochoa-Tocachi3, Bryan Pérez-Almeida3, Sandra J Torres2,7, Charles Zogheib8, Bert De Bièvre9, Wouter Buytaert1 and Regional Initiative for Hydrological Monitoring of Andean Ecosystems (iMHEA), (1)Imperial College London, Civil and Environmental Engineering & Grantham Institute - Climate Change and the Environment, London, SW7, United Kingdom, (2)ATUK Consultoría Estratégica, Hidroinformática, Cuenca, Ecuador, (3)ATUK Consultoría Estratégica, Hidroeconomía, Cuenca, Ecuador, (4)Fondo para la Protección del Agua - FONAG, Programa de Gestión del Agua, Quito, Ecuador, (5)Empresa Pública Metropolitana de Agua Potable y Saneamiento de Quito, Gerencia de Ambiente y Seguridad, Quito, Ecuador, (6)Katarisoft, Desarrollo Informático, Cuenca, Ecuador, (7)Escuela Politécnica Nacional, Centro de Investigaciones y Estudios en Recursos Hídricos, Quito, Ecuador, (8)Imperial College London, Department of Civil and Environmental Engineering, London, United Kingdom, (9)Fondo para la Protección del Agua - FONAG, Secretaría Técnica, Quito, Ecuador
Abstract:
The historical engineering approach to ensure water availability through the use of “grey” infrastructure, such as reservoirs, levees, and dams, is outdated. High sunk costs, lack of adaptive capacity, and complex implementation of traditional civil infrastructure have increased interest in applying nature-based solutions, which leverage and mimic biophysical processes to improve water quality, quantity, and timing. This interest has been particularly strong in Latin America, where institutional and cross-sectoral partnerships have resulted in notable policy developments and financial commitments for collaborative water resource management. One of the most innovative schemes are water funds, devised as long-term financial mechanisms to invest in a portfolio of watershed interventions with the aim of ensuring adequate water availability for a diverse set of stakeholders.
We present a methodology for the hydro-economic evaluation of the water fund of Quito (FONAG), using their two main stakeholders as case studies: the city’s water utility (EPMAPS) and the public hydroelectric generator company (EEQ). The methodology integrates data collection, ecosystem functioning understanding, quantitative predictions, hydro-economic evaluation, and uncertainty analysis. Applying this methodology, we find that investing in watershed interventions is an economically effective way to improve the supply of ecosystem services, including but not limited to water yield, hydrological regulation, and water quality. Furthermore, in our case study, investments in natural infrastructure interventions are more cost-effective when they are channeled through a polycentric-mediator mechanism such as a water fund, multiplying the hydrological and economic benefits that otherwise would have been achieved with individual interventions.
Several challenges remain, such as reconciling the interests and benefits of multiple stakeholders under competitive water-related scenarios and trade-offs between ecosystem services, especially not-water-related. Nevertheless, it is paramount to explore how multiple stakeholder cooperation and solutions to water-related problems can complement each other to support water management, policy making, and sustainable development of socio-hydrological systems.
