AdaptCost
Briefing Paper 7: Adaptation Costs for Water in Africa
Key Messages
1.
Estimates of the economic costs of adaptation require investigation of several lines of evidence. These range from
detailed case studies of projects and plans through to the global scale of integrated assessments. Each approach
brings insight into a complex area, where we have relatively little experience. This note considers the costs of
adaptation for water resources. Fisheries, agriculture, energy, and health linkages are not fully covered.
2.
Water has been identified as one of the key sectors for adaptation in Africa. A range of potential impacts could
occur from climate change including changes (positive and negative) for water resource availability, as well as risks
of the increased frequency and intensity of extreme events in the form of floods and droughts.
3.
Highly aggregated, top-down methods have been the focus of work to date for impacts and adaptation costing at
regional levels, while more bottom-up work using cost benefit analysis of adaptation options in river basins has been
carried out at sub-national scales.
4.
At the continental scale, a number of studies have estimated adaptation costs. The UNFCCC (2007) estimated
adaptation investments (above the business as usuall case) at $233 billion ($4.7 billion/yr) under A1b and $223
billion ($4.5 billion/yr) under B1 to 2030, or 20% and 30% of the estimated global needs, respectively. Investments
included increased reservoir storage and ground water use, water reclamation, desalination, and virtual water.
5.
Other studies (Parry et al, 2009) highlight that the UNFCCC study, and other similar ones, have a number of
deficiencies, finding that these previous numbers are substantial under-estimates. In the case of the water sector,
this involves unrealistic assumptions regarding water transfers in large countries, excluding the costs of adapting to
floods and droughts or inter-linkages between adaptation in water, agriculture and energy sectors.
6.
Continental scale work by the World Bank (2010) using a scenario based analysis estimates that net annual public
investment adaptation needs in Sub-Saharan Africa for water supply and riverine flood protection under NCAR and
CSIRO scenarios are $6.2 billion and $7.1 billion in the 2010-2050 time horizon, respectively. Differences in costs
between scenarios are due to higher reservoir storage capacity needs under CSIRO to meet equivalent demands
among industrial and municipal consumers. Despite drier mean conditions, higher magnitude monthly flood events
also result in greater relative costs for riverine flood protection under the CSIRO scenario. Neither estimate
accounts for overlaps in spending with baseline (BAU) growth or of adaptation costs for other sectors.
7.
Comparison of continental study results indicates that inclusion of flood protection costs increases adaptation costs
significantly.Nonetheless, a general finding is that adaptation is frequently cost-effective, and should be prioritized
as an early opportunity that can significantly reduce potential impacts.
8.
There are few studies at the national or sub-national scale. In the case of South Africa’s Berg River Basin, contrary
to initial research expectations, increased storage capacity in the basin produces larger welfare benefits than
varying allocation and pricing policies.
9.
Efforts to create integrated strategies for climate, environment and socioeconomic changes linking strongly with
development processes also driving water system dynamics, and should be research and planning priorities.
Towards this end, the AdaptCost study highlights key issues related to costs of achieving the MDGs, urban water
supply and sanitation, the high potential of rainwater harvesting as a robust strategy, in addition to information
investments and integration with disaster risk reduction for urgent adaptation efforts.
10. Achievement of water related MDGs are important for climate resilient development and adaptation. As part of the
World Bank’s Africa Infrastructure Country Diagnostic (AICD), current financing needs to address the growing deficit
in safe water provision were estimated between 0.7 and 1.3 percent of Africa’s GDP in 2005. An upper bound
estimate to meet MDG goal 7 by 2015 is $3.3 billion annually, with 55 percent in O&M expenditures, and the rest in
capital investment and sector management. There appears to be an outstanding financing gap for O&M rather
than capital investments (Mehta et al., 2005).
11. The AdaptCost review highlights the need for economic analysis involving comprehensive methods capturing more
holistic, adaptive management approaches including both soft and hard investment options, basin-level planning,
and incorporation distributional and cross-sectoral issues at the heart of development progress, and climate
adaptation planning.
1
Background: Climate Change
and Agriculture in Africa

Climate change is likely to affect Africa’s water
resources and the frequency and intensity of
extreme events over the coming century. This
poses a threat to human welfare and
developmentin rural and, increasingly, urban
populations in Africa.

Previous work, such as IPCC AR4i and other
reviewsii, has identified a potentially wide range of
impacts at regional levels.
Studies highlight
Africa’s high level of vulnerability relative to other
world regions given already high levels of water
stress, low levels of development and adaptive
capacity to extreme events.
Socio-economic development and other factors
affecting water resource development, including
population growth, the movement of people and
goods, and policy decisions are equally important
for analysis of climate outcomes. Uncertainty
surrounding the present (and future) extent and
usage of renewable surface water and particularly
groundwater in Africa are also critical
considerations, and frequently omitted in the latter
case (Taylor et al., 2009)iv.These considerations
might reduce (as well as increase) the burden of
potential impacts.
Implications of the wide range of potential climate
change impacts (positive and negative)are far
reaching for traditional water managers.This is in
large part because changes in temperature and
precipitation changes are usually amplified in
water systems. This is illustrated by Hewitson et
al., 2005iii for Southern Africa, and byBeek, 2009
for the Nile River Basin.1
Cross-sectoral linkages, particularly for energy
and agriculture sectors, and ecosystem demands,
are equally significant and challenging to
anticipate.
Moreover,
simply
basing
future
water
management on past hydrological trends does not
protect against a range of uncertain and nonstationary future climates. Gleick et al., 2000
gives further arguments against reliance on
traditional management, calling for new, more
flexible, approaches to risk management in the
sector:


range for which current infrastructure was
designed and built;
Relying solely on traditional methods
assumes that sufficient time and
information will be available before the
onset of large or irreversible climate
impacts to permit managers to respond
appropriately;
Traditional approaches assume that no
special efforts or plans are required to
protect against surprises or uncertainties.
Existing Studies of the economic
Impacts of Climate Change on
Agriculture in Africa
Economic analysis of climate impacts and
adaptation is its beginning for Africa. At regional
and national-levels, few studies have been carried
out to assess these costs. At the continental
level, primary methodsapplied to estimate
economic impactsare investment and financial
flows (IFF) and partial-equilibrium economic
modelling coupled with runoff modelling.
A
summary and comparison of studies based on
these approaches was carried out for continental
level impacts.
Climate changes are likely to produce – at
some places and some times – hydrologic
conditions and extremes of a different
nature than current systems were
designed to manage;
Climate changes may produce similar
kinds of variability, but outside of the
1 Under an estimated 10 percent increase in rainfall in the
equatorial lake area and Ethiopia, there will be an estimated
40 percent increase in annual flow in the Nile. In contrast, a
10 percent decrease in rainfall will result in a 40 percent
reduction in Nile flows, which would be disastrous for Egypt
and become unsustainable even if water demand does not
increase.
2
Continental
studies
adaptation
In terms of reservoir storage (106 m3), additional
needs for 2050 under the A1B scenario are
dominated by Mauritania (3889), Mali (1163),
Niger (958) and Senegal (583).
Additional
reservoir storage needs in North, East, Central
and South Africa are dominated by Morocco
(9032), Sudan (3311), Zimbabwe (690), Egypt
(565), Ethiopia (644), and Somalia (417). In the
case of West Africa, 60%, or 7.21 km3/yr, of
additional wells required under the A1B scenario
by 2050 are needed by Nigeria, with the
Democratic Republic of Congo requiring 24%
(2.34 km3/yr), the majority of other regional
needs.
cost
1) Kirshen et al. 2007, UNFCCC
To estimate the potential cost of climate change in
the water sector, Kirshen et al., 2007v conducted
a global analysis of changes in water supply and
demand. The study included Africa regional
coverage and was updated for the UNFCCC
2007vi report. Consumers included domestic,
industrial and agricultural groups.
Methods
involved investment and financial flow analysis to
calculate increased reservoir storage and ground
water use, water reclamation, desalination, and
virtual water. Uniform average temperature and
precipitation changes were used based on
scenario averages from GCMs in the UNFCCC
Fourth Assessment Report. Detailed hydrologic
modelling was not carried out.
Reclaimed wastewater, as well as desalinization
(1 km3/yr), needs are entirely accounted for by
Mauritania (1.7 km3/yr) in West Africa. Egypt
overwhelmingly
accounts
for
reclaimed
wastewater needs (73% or 65 km3/yr) in other
regions. Egypt (30 km3/yr), Tunisia (27 km3/yr),
Algeria (15 km3/yr) and Morocco (10.5 km3/yr)
account for the largest desalinization needs in
North, East, Central, and South Africa by 2050
under A1B.
Africa regional results show generally increasing
runoff in inland West Africa and decreasing in
coastal regions under the A1B scenario.
However, decreases are indicated in Southern
regions, and increases in the Horn of Africa.
Analogous changes were found for in Northern
and Central Africa, respectively.
Overall, Egypt’s future demand needs stand out
due to acute shortages in the present allocation
scheme, for which it desalinates for 50% of
industrial, commercial, urban water, uses its
surface and ground waters to meet the rest for
irrigation.
West Africa responds to climate
influences with anticipated increases in flows, flow
variances and demands in A1B conditions.
However, sensitivity to costs of climate change
vary on a nation by nation basis, requiring more
detailed spatial and temporal analysis for planning
purposes.
Demand (2000, 2050) and total capital costs from incremental
supply sources (e.g. additional reservoir storage, additional
wells, reclaimed wastewater, desalinization, improved
irrigation, unmet irrigation)
Region
A1B/
B1 Cost
A1B Cost
Demand
($)
($)
Km3
West Africa
105.711 5.24E+09
6.75E+09
Estimated West
Africa
North,
East,
Central,
South
Africa
Estimated North,
East,
Central,
South Africa
Total
-587.58
--
2.39E+06
4.59E+06
1.26E+11
1.31E+11
7.78E+06
1.31E+11
Under the UNFCCC, 2007 study, adjustments
were made to the original Kirshen, 2007 estimates
to account for more expensive sites and unmet
irrigation demands.
For global results, the
UNFCCC estimated Africa would need $233
billion ($4.7 billion/yr) under A1b and $223 billion
($4.5 billion/yr) under B1 to 2030, or 20% and
30% of the estimated global needs, respectively.
1.69E+07
1.38E+11
Source: Adapted from Kirshen, 2007. Costs were scaled
using cost indices reported in Fischer et al., 2006 for regional
irrigation costs.
Capital costs for groundwater and
desalinization were taken from US references, and surface
water storage were based on Chinese and US references.
Also note, the only improved or unmet irrigation (km3/year)
included in the capital costs is for Somalia, Zimbabwe,
Swaziland, and South Africa.
3
units of the partial-equilibrium economic model
(IMPACT) developed by IFPRI.
2) Parry et al., 2009
A review by Parry et al., 2009vii summarizes
reasons why estimates based on the top-down,
IFF approach by Kirshen/UNFCCC, 2007 are
likely to be considerable underestimates of actual
adaptation costs. Some of these reasons, many
mentioned by Kirshen, 2007, include:
 Assumption of perfect adaptation
 Bias introduced by use of averaged GCM
scenario results, rather than ensemble
range
 Unrealistic assumptions regarding water
transfers within large countries
 Use of empirical relationships between
annual runoff and its variability, and
reservoir capacity that cannot incorporate
runoff changes through the year due to
climate change
 Exclusion of ‘soft’ adaptation options
 Excludes costs of adapting to flood risks
and cross-sectoral linkages
 Lack of consideration of residual
damages, or operation and maintenance
costs.
Comparisons of water supply and flood protection
adaptation investment needs show the drier
(CSIRO) climate scenario to be greater than the
wetter (NCAR) scenario, given higher reservoir
storage capacity needs under CSIRO to meet
equivalent demands among industrial and
municipal consumers.
Despite drier mean
conditions, higher magnitude monthly flood events
also result in greater relative costs for riverine
flood protection under the CSIRO scenario. Total
net annual costs of water supply and flood
protection needs under NCAR and CSIRO are
$6.2 billion and $7.1 billion, respectively (see
table).
Net annual adaptation costs for water supply and riverine flood
protection, 2010-2050 ($ billions at 2005 prices, no
discounting).
Global climate model
Water
Flood
Total
supply
protection
NCAR (wettest scenario)
5.9
0.3
6.2
CSIRO (driest scenario)
7.3
-0.2
7.1
Source: World Bank, 2010.
Note: Net costs are the pooled costs without restrictions on
pooling across country borders (positive and negative values
are treated symmetrically).
Other issues include the use of generalized
functional relationships to estimate the costs of
adaptation responses, adjusted from data derived
in US or China and applied to Africa. This also
highlights an overall need for more bottom-up
level studies to validate aggregate estimations of
adaptation costs.
Other key findings of the World Bank work are
summarized below:
3) World Bank, 2010
A recent study by the World Bank assessed the
costs of adaptation management options for water
supply for industrial and municipal consumers. In
contrast to Kirshen/UNFCCC 2007viii, flood
protection measures were included while
agriculture sector demands excluded over a 2050
time horizon for two GCM models. Ecosystem
services were also not considered. Methods
involved running the Climate and Runoff model
(CLIRUN-II) on a monthly time-step, including the
10-year and 50-year maximum monthly runoff.
Results were aggregated to the food production
4

Water supply and flood management ranks as
one of the top three adaptation costs across
sectors in both the wetter and drier scenarios,
with Sub-Saharan Africa footing by far the
highest costs among world regions.

EACC study results are higher than previous
estimates (e.g. UNFCCC) due to inclusion of
riverine flood protection costs and inclusion of
the cost of adaptation to extreme weather
events.

Adaptation should start with the adoption of
measures that tackle weather risks that
countries already face, e.g. more investment
in water storage in drought-prone basins,
storm and flood protection, strengthening
property rights, and flood plain and landslide
area zoning.

The clearest opportunities to reduce the costs
of adaptation are in water supply and flood
protection.
Synthesis
ofRegional
Adaptation Costs
$6.2
and
$7.1
billion
annually versus
Kirshen/UNFCCC, 2007 estimating between $4.5
and $4.7 billion annually, not including flood
protection.
Also notable are assumptions
regarding operations and maintenance costs,
which were (partially)included in World Bank
analysis only. Costs of wastewater treatment
were not addressed in either regional study.
Level
Although different top down approaches were
employed in investment and financial flows work
by Kirshen/UNFCCC, 2007, and hydrological
modelling from the World Bank, 2010, both are
biased towards ‘hard’ or infrastructure-based
adaptation options.
Overall, the high levels of uncertainty surrounding
climate change impacts on the hydrological cycle,
namely precipitation and evaporation, underscore
the only indicative nature of adaptation economics
estimates, and should be used with caution. Key
issues and associated challenges applicable to
adaptation economics analyses, regardless of the
scale, are discussed in the below table.
While efficiency increases are incorporated to
some extent, ‘soft’, adaptation policy options (e.g.
floodplain management) and investments in
ecosystem resilience are not factored into costing
analyses.
Study results may therefore be
considered underestimates (or overestimates) of
actual demand and supply-side, and ecosystem
related, investments needed to adapt to climate
change in Africa’s water sector.
Economic results of the two reviewed studies are
compared in the below table.
Economic
method
Scope
Time
horizon
Investment
and
financial
flows
(Kirshen/UN
FCCC,
2007)
Hydrologic
and
IMPACT
modelling
(World
Bank, 2010)
Water
supply
(domestic,
municipal,
and agri.
Consumers)
2030 with
20 year
planning
period,
2050 time
horizon
Water
supply and
flood
protection
(municipal
and
industrial
consumers)
2050
Estimated
annual
investment
needs ($ billions)
$4.7 (A1B)
$4.5 (B1)
Key issue
Critiques and challenges
Scope of
analysis

‘Hard’
versus ‘Soft’
adaptation
investments,
and focus on
supply-side
interventions



Baselines
for
adaptation
costing


$6.2 (NCAR, A2)
$7.1 (CSIRO,
A2)

Adaptation
and
development
synergies
The first key message is that overall adaptation
investment needs are especially dependent on
what cost categories are included in the analysis.
Comparison of study results indicates that
inclusion of flood protection costs increases
adaptation costs significantly.
World Bank, 2010 estimates with flood protection
and water supply considerations reach between
River basins
as units of
analysis

Uncertainty
in impacts
on the
hydrological
cycle under
climate
change


For example, exclusion of flood
protection in Kirshen/UNFCCC, 2007
result in possible underestimates of
impacts and adaptation costs.
This bias is illustrated by emphasis on
supply-side infrastructure investments,
often excluding operations and
maintenance costs
Ecosystem resilience investments,
awareness raising and training
investments warrant more quantitative
focus.
Moreover, overall adaptation costs
depend on the comprehensiveness of
categories covered.
Study comparability is hindered by use
of different baseline approaches and
adaptation-development costing
considerations.
Practically, distinguishing between
adaptation and development is useful
for national and international planning
and budgeting purposes.
Although many synergies exist between
adaptation and development, important
exceptions exists, particularly in the use
of water for hydroelectric production
and irrigation (not assessed in this
work).
Water resource issues are
fundamentally based on river basins as
a unit of analysis. Holistic adaptation
management and economics analyses
must take this into consideration for
more comprehensive analyses.
Scenario averaging techniques can
mask trends and extremes in
projections.
High and low climate scenario
techniques capturing extremely wet or
dry futures are potentially more robust
(e.g. World Bank, 2010).
Source: Author.
5
D. Efficient water markets, no free water policy
Optimal storage for Berg Dam (103 m3)
Basin-level
Study
Adaptation
Case
The costs and benefits of each of the four options
were quantified using the following indicators:
In the case of the water sector, basin-level
analyses are particularly important, as basins are
a fundamental unit of hydrological systems. In
contrast to aggregate, regional level work, these
studies benefit from a greater degree of
contextualisation and inform the design of
adaptation strategies for national and sub-national
authorities.
1) Calloway et al., 2009 –The Berg River
Basin, South Africa
In order to assess the costs and benefits of
different climate change adaptation options for
South Africa’s recently completed Berg River
Basin dam, Calloway et al., 2009ix developed a
policy-planning tool based on welfare impacts.
Options involved either increasing maximum
storage capacity of the dam and/or policy
interventions introducing a system of efficient
water markets.
General conclusions of the welfare cost
comparisons indicate that climate change:
 Will reduce total water availability by 8058
m3 (or 11%) in the near future (NF) case and
16,609 m3 (or 17%) in the distant future (DF)
case.
 Reduces basin-wide welfare for all four of
the policy scenarios, between 6.3% and
8.4% for the NF climate scenario and
between 11.5% and 15.6% for the DF
climate scenario.
Four policy scenarios and management options
were tested across three time horizons including a
reference (1961-1990, applied to 2010-2039),
near future (2010-2039) and distant future (20702099, applied to 2010-2039) scenarios. The
WatBal model was used to create these climatehydrology scenarios using CSIRO B2 projections.
The four policy scenarios and options explored
are listed in the below table.
Contrary to initial research expectations,
increased storage capacity in the basin produces
larger welfare benefits than varying allocation and
pricing policies across each of the three climate
scenarios. Overall results of the cost benefit
analysis for the Berg River Basin indicate that,
“Adding storage capacity is a better strategy
for coping with climate change (at this level
of urban water demand) than using water
markets and marginal cost pricing to allocate
water.”
Policy scenarios and options
A. Fixed farm allocations and free water policy to
households
No Berg Dam
B. Efficient water markets, no free water policy
No Berg Dam
C. Fixed farm allocations and free water policy to
households
Optimal storage for Berg Dam (103 m3)
6
Adaptation
entry
points
adaptation economics in
development context
water.
As part of Africa’s Millennium
Development Goals (MDGs), Africa committed to
reducing the number of people without
sustainable access to safe drinking water by half
(MDG 7). High rates of urbanization, estimated at
3.6 percent per year, and population growth of
2.15 percent per year have caused Sub-Saharan
Africa to lag behind other regions in progress
towards achieving the MDGs (Banergee et al.,
2008)x.
Changing precipitation andincreased
temperatures under climate change pose
additional challenges to progress.
–
a
Adaptation economics can be useful to decision
makers and water resource planners by taking
into consideration of development contexts, as
illustrated by the Berg River Basin case. Issues
of adequate, affordable, and reliable water
resource provision to both urban and rural
consumers are especially relevant for locally
appropriate adaptation planning. Differentiating
between different socioeconomic groups, the
structure of formal and informal water markets,
and technological investments within these
contexts is also necessary for mapping
vulnerability and prioritizing areas for public and
private intervention.
Mehta et al., 2005xiestimate current financing
needs to address this growing deficit in safe water
provision were estimated between 0.7 and 1.3
percent of Africa’s GDP.
An upper bound
estimate to meet the MDG goal by 2015 is $3.3
billion annually, with 55 percent in O&M
expenditures, and the rest in capital investment
and sector management. Evaluation of water
sector financing in Sub-Saharan Africa indicates
“The financing gap does not appear to be a
problem in capital expenditure, but the gap
between O&M needs and available
resources stands at about 0.3 percent of
GDP…This translates to about $1.6 billion
in 2005 for O&M investments.”
Cross-sectoral linkages between water resources
and agriculture, energy, health, ecosystem
services and other key development areas are
also necessary for effective and efficient
adaptation investments.
Efforts to create
integrated strategies to climate, environment and
socioeconomic changes that drive water system
dynamics should be research and planning
priorities. Towards this end, the AdaptCost study
highlights key issues related to costs of achieving
the MDGs, urban water supply and sanitation, the
high
potential
of
rainwater
harvesting
development, information investments and
integration with disaster risk reduction for urgent
adaptation efforts.
that:
The financing problem highlighted for operations
and maintenance, as opposed to capital
investments, can help guide interventions that
accelerate provision of safe water supplies.
Achievement of MDG water goals closely align
with adaptation options classified as accelerated
development to reduce current deficits, which
increase vulnerability to future climate change. In
the case of Africa’s largely rural, but rapidly
urbanizing settlements, the need for improved
water supplies for sustainable development and
climate adaptation is urgent and rising.
Overall, a framework of adaptive management,
supported by more local-scale economics
analysis and stronger development orientations, is
suggested as a way forward for adapting Africa’s
water sector to climate change.
However, the scope of interventions needed to
achieve goals of improved water provision
extends
beyond
capital and
operational
considerations. Distributional, governance and
investment issues related to provision of improved
water supplies, along with questions linking
1) MDG investment needs for Sub-Saharan
Africa
Currently, an estimated 56% of the population of
Sub-Saharan Africa has access to safe drinking
7
development
exploration.
with
adaptation
require
further
2)
Distributional,
governance
and
investment issues in an urbanizing Africa
Water resource pressures facing Africa’s urban
populations are expected to increase dramatically
over the coming decades.
Estimated urban
population growth averages an unprecedented 5
percent per year. At this rate, Africa’s urban
population will double before 2030. Where less
than half of urban residents have access to
improved water, this poses a large and growing
challenge to sustainable development, and is
potentially compounded by climate change
(Kessides, 2006).xii

Cost recovery efforts and/or public-private
investment to cover O&M financing gaps,

Use of climate adaptation funds for
investment in accelerated development and
social protection programs, particularly
targeting the urban poor facing water
insecurity and greater poverty compared to
households with piped connections.
This work also highlights that sectoral monitoring,
regulation and investment strategies will need to
be in place if adaptation financing (let alone
current development financing) is going to
effectively target vulnerable groups and be
sustainable.
3) Rainwater harvesting for urban and rural
water provision
Important insights into development and
adaptation entry points for urban water provision
are available from the World Bank Africa
Infrastructure Country Diagnostic (AICD) project
assessing water sector infrastructure and
management systems covering African 32
countries. Selected countries account for 85
percent of GDP, population and aid flows for
infrastructure in Sub-Saharan Africa.
Limited investment in improved water supplies in
Africa
makes
identification
of
promising
technologies across the sector a priority for
development and adaptation. In Africa’s semihumid and semi-arid areas, rainwater harvesting
techniques have great potential to provide reliable
water supplies to both urban and rural populations
facing erratic and highly variable rainfall.
As part of Africa’s Water Vision 2025, increasing
“water wisdom” and “drought-proofing” crop
production are key rationales behind rainwater
harvesting and other investment commitments.
Rainwater harvesting technologies not only meet
needs of surface and soil water scarcity, but also
mitigate against flash flood events and reduce
often high costs of water provision under large,
centralized schemes in areas even with high
average rainfall.
Rainwater harvesting also
diminishes the burden of water hauling, which
affects mostly women, by supplying water closer
to home.
Contributions by Banerjee et al., 2008 and Keener
et al., 2008xiii assessed the extent and type of
coverage, key suppliers and consumers in formal
and informal urban water markets.
Detailed
analysis revealed that the urban poor pay
significantly more for water and face low-quality
and unreliable supplies.
These and other
distributional, governance and investment issues
are summarized in the full AdaptCost report,
along with possible questions and challenges
relating to climate adaptation. Addressing these
issues may help identify early urgent actions that
support MDG achievement, and the adaptive
capacity of Africa’s urban water sector.
“It is estimated that 40 billion working hours
are lost each year in Africa carrying water.” –
Garrity et al., 2005
As noted in the MDG assessment above, a key
AICD study finding is the problem of adequate
financing of operations and maintenance for
improved urban water supplies, more so than
capital costs in general. Strategies to address
this rising challenge might include
Moreover,
various
rainwater
harvesting
technologies increase the resilience and coping
capacity of populations facing uncertain climate
8
(Senkondo et al., 2004).xv Study results find
rainwater harvesting improves gross margin and
returns to labor, particularly for maize and onion
farmers. Where markets are available, rainwater
harvesting enables farmers to switch to high value
crops, with very significant benefits to incomes
and livelihoods. For maize production using
diversion canals for rainwater harvesting, the
benefit cost ratio (net present value) was greater
than one with an internal rate of return (IRR) of 57
percent. Rice paddy production also had a
positive NPV and IRR of 31 percent. Moreover,
futures, and warrant attention as a priority area for
robust
adaptation
investments.
These
investments illustrate strong synergies between
development and climate adaptation activities in
Africa.
In GIS work carried out by ICRAF and UNEP in
2006, the rainwater harvesting potential of Africa
was mapped (Garrity et al., 2005)xiv. The project
aimed to provide spatial databases that convey
the huge potential for rainwater harvesting for
advocacy and decision support.
Rainwater
harvesting technologies selected included rooftop
harvesting and storage, surface and flood runoff
collection (blue water), and in-situ water collection
and storage for crop production (green water).
“Due to existing potential and profitability of
rainwater harvesting, it is recommended that
rainwater harvesting be prioritized in Tanzania,
particularly in the semi-arid areas.” – Senkondo
et al., 2004
Among the technologies explored, rooftop
harvesting covers the largest areas in terms of
extent, because of its application in both rural and
urban settlements. This technology is particularly
appropriate in Africa’s semi-humid and semi-arid
areas with low average rainfall.
The study
estimated that areas receiving just 200 mm
annual rainfall have as much potential (and more
priority) for rooftop harvesting as areas with
higher averages. Presence of roofs to provide
catchment areas is the primary requirements for
installation.
Further analyses of agricultural interventions that
improve climate resilience for adaptation are
detailed in the AdaptCost Agriculture briefing note
and full sectoral report.
Adaptive management:
forward for economics
The cost of realizing the above potential was not
estimated. The AdaptCost study recommends
this as an area for future work.
However,
numerous detailed assessments carried out at
national and sub-national levels provide insight
into investment needs for rainwater harvesting.
Case study 2 in the full AdaptCost report presents
estimated investment needs for developing
Zanzibar’s
rainwater
harvesting
potential.
Benefits in mainland agriculture are also
highlighted below.
4) Rainwater
agriculture
harvesting
-
Links
Ways
To date, adaptation economics studies in Africa
and other world regions have followed
methodologies largely characterized by quantified
supply-side
investments,
and
qualitative
suggestions for demand-side interventions.
However, more comprehensive adaptation
economics is required to provide a holistic and
flexible adaptation management options. A focus
on adaptive management provides a useful
framework for decision making under high levels
of biophysical and socioeconomic uncertainty
influencing the water sector.
to
The below figure illustrates an adaptive
management framework whereby controllable
measures (e.g. regulation of water use) are
prioritized in situations of high uncertainty, as
In the case of Tanzania, Gross margin and costbenefit analyses of in-situ technologies for maize
and rice farming indicate the considerable
benefits of rainwater harvesting in semi-arid areas
experiencing erratic and variable rainfall
9
Using this framework, recommendations can be
made for improved costing estimates of water
sector investment needs not yet covered in
analyses to date.
Conclusions
Priorities
and
Research
This paper provides an overview of the literature
currently available on the estimation of adaptation
costs associated with climate change and Africa’s
water sector. To supplement the limited material
available, relevant development related work was
also reviewed.
Different management approaches for dealing with uncertainty
in information and the controllability of outcomes. Source:
Adapted from Falkenmark et al. in Molden, 2007, and adapted
originally Peterson, Cumming and Carpenter, 2003.xvi
Adaptation economics assessments to date are
important first steps towards managing effects of
climate change on water supplies in Africa.
However, because these studies rely on highly
uncertain assumptions, and are limited in scope
and development-context, results are of limited
use to policy makers and resource managers.
This highlights the need for economic analysis
involving more comprehensive methods capturing
more holistic, adaptive management approaches.
Future focus areas should include both soft and
hard investment options, basin-level planning, and
incorporation distributional and cross-sectoral
issues at the heart of development progress, and
climate adaptation planning.
opposed to probabilistic approaches used in
optimization modelling or hedging.
Scenario
planning is also a valuable management tool in
the context of uncontrollable variables, including
population growth, providing a robust compliment
to adaptive management strategies.
Tunisia’s approach to water management (Case
Study 3 in full sectoral report) illustrates how
adaptive management imbeds responsiveness
and flexibility into dynamic systems. This is
based on a combination of data collection,
scenario modelling and close stakeholder
engagement promote robust, process-based
management. Given costing such institutional
arrangements and management approaches is
difficult in most African contexts, illustrative
analyses would be of value to guide management
strategies.
Economics studies to date have not taken into
account the following issues, which make up
priority recommendations for future research and
management:

The following figure provides a framework for
adaptive management in the water sector that
may be of use in directing adaptation investments:
Stylized adaptive management framework for Africa’s water
sector. Source: Adapted from Falkenmark et al. in Molden
ed., 2007.xvii
10
Adaptive management: As a method of coping
with the uncertainty inherent in water sector
impacts of climate change, an adaptive
management approach provides a potentially
valuable strategic framework.
Adaptive
management treats policy as hypothesis and
management as experiments, emphasizing
learning and evaluation of interventions as part
of an iterative process of adaptation.
Percentage markup or hydrological modelling
driving estimated adaptation costing studies
are not representative of dynamic or adaptive
strategies that may lower overall costs.





Technological change: Introduction of new
technologies will almost certainly continue to
transform
water
management
(e.g.
desalinization, waste water treatment, rainfall
generation, etc.) and have significant economic
implications. Timing and cost of changes is,
however, is highly unpredictable but should be
noted in adaptation analyses.
River basins as key management units:
River basins are the basic ecological unit for
water resources. There is need for basin-level
management of water resources, coupled
adaptive management, to support sustainable
development and adaptation strategies. Basinlevel approaches maintain the resilience of
river ecosystems, which are largely fragmented
by interruption and interception of natural
river flow and management systems delineated
by political instead of natural boundaries.
Investment in observation and monitoring
systems: Establishment of meteorological and
hydrological monitoring (e.g. metering), flood
protection and early warning systems are
urgent priorities for supporting accelerated
development and adaptation of water
resources.
‘Soft’ verses ‘hard’ adaptations options:
Studies including Kirshen/UNFCCC, 2007 and
World Bank, 2010 focus on ‘hard’,
infrastructure-based, supply side adaptation
options with little or no economic
consideration for ‘soft’ or policy oriented
supply
and
demand
side
options.
Consideration should also be given to
adaptations based on investment in ecosystem
resilience and management policies (e.g. use of
water markets by Calloway et al., 2009 for the
Berg River Basin in South Africa) are often less
costly and more sustainable than harder
options (e.g. dam building).
Cross-sectoral water issues: Water resource
management is a cross-sectoral issue.
Fundamental sectoral linkages between water
and health, energy, agriculture, ecosystems and
infrastructure need to be taken into
consideration in economic assessments of
integrated management options.
11

Governance issues: Governance issues related
to institutional management models and formal
and informal market dynamics are key to
addressing issues of water poverty, scarcity and
quality issues that increase vulnerability to
climate change.

Stakeholder engagement: At the heart of
effective water management is the close
engagement and, where necessary, training of
local stakeholders.

Development
and
livelihoods
focus:
Achievement of MDG water goals closely align
with adaptation options classified as
accelerated development to reduce current
deficits, which increase vulnerability to climate
change. Financing shortfalls highlighted for
operations and maintenance, as opposed to
capital investments, in achieving water MDGs
can help guide joint development and
adaptation interventions that accelerate
provision of safe water supplies and build
adaptive capacity.

Account for urban-rural differences: There
is a great need to account for urban-rural
differences in water resource needs, and trends
in vulnerability related to water poverty and
insecurity over time. These have implications
for the financial, social and environmental
sustainability of water resources presently and
over coming decades.

Rainwater
harvesting
for
robust
management:
Assessment of rainwater
harvesting potential for urban and rural
settlements illustrates a robust climate
adaptation investment that mitigates challenges
of accelerated water shortage and excess under
current and future climates.
This also
highlights the significant potential of lower-cost
interventions
compared
to
large-scale
infrastructure investments (e.g. reservoir
construction).

Focus on women: Gender issues are at the
heart of water management in Africa. Women
in Africa make up an estimated 90 percent of
the informal labor market and bear
disproportionately high burdens in the water
sector. Targeting of women and women’s
groups should be a priority of adaptation
interventions.

Linden and C.E. Hanson, Eds., Cambridge University Press,
Cambridge UK, 433-467.
ii
Nkomo, J.C. , A. O. Nyong, Nigeria, K. Kulindwa, Final Draft
Submitted to The Stern Review on the Economics of Climate
Change July, 2006.
Supply
and
demand-side
financial
sustainability:
Financial sustainability of
water provision is necessary for addressing
investment shortfalls towards achieving MDGs
(e.g. caused by hidden costs or quasi-fiscal
deficits).
iii Hewitson et al., 2005. “General conclusions on
development of plausible climate change scenarios for
Southern Africa”, in R. E. Schulze (ed.), Climate Change and
Water Resources in Southern Africa: Studies on Scenarios,
Impacts, Vulnerabilities and Adaptation. Water Research
Commission Report 1430/1/05, WRC, Pretoria, South Africa,
Chapter 5, pgs. 75-79.
iv Taylor, Richard G., Koussis, Antonis D., and Tindimugaya,
Callist, 2009. Groundwater and climate in Africa—a review.
Hydrological Sciences, 54(4). Special Issue: Groundwater
and Climate in Africa.
v Kirshen, Paul, 2007. Adaptation options and cost in water
supply. A report to the UNFCCC Financial and Technical
Support Division (http:// unfccc.int/cooperation_and_support/
financial_mechanism/financial_mechanism_gef/items/4054.ph
p)
vi UNFCCC, 2007. Investment and financial flows relevant to
the development of an effective and appropriate international
response to Climate Change (2007). United Nations
Framework Convention on Climate Change
vii Parry, Martin, Arnell, Nigel, Berry, Pam, Dodman, David,
Fankhouser, Samuel, Hope, Chris, Kovats, Sari, Nicholls,
Robert, Satterthwaite, David, Tiffin, Richard, Wheeler, Tim,
(2009) Assessing the Costs of Adaptation to Climate Change:
A Review of the UNFCCC and Other Recent Estimates,
International Institute for Environment and Development and
Grantham Institute for Climate Change, London.
viii
World Bank, 2010. The Economics of Adaptation to Climate
Change (EACC) synthesis report.
ix
Callaway, John, Louw, Daniel, and Hellmuth, Molly.
“Benefits and costs of measures for coping with water and
climate change: Berg River Basin, South Africa”, In Ludwig
(eds.), Climate Change Adaptation in the Water Sector. Cha.
14.
x
Banerjee et al., 2008. Ebbing water, surging deficits: Urban
water supply in Sub-Saharan Africa. Africa Infrastructure
Country Diagnostic (AICD), Background Paper 12 (Phase 1).
xi
Mehta, M., T. Fugelsnes, and K. Virjee, 2005. Financing the
Millennium Development Goals for Water Supply and
Sanitation: What will it take? Water Resources Development
21(2): 231-252.
xii
Kessides, Christine, 2006. The urban transition in SubSaharan Africa: Implications for economic growth and poverty
reduction. The Cities Alliance.
xiii
Keener et al., 2008. Water provision and the poor in Africa:
Informal water markets and standpoints experience. African
Infrastructure Country Diagnostic (AICD), The World Bank,
Washington D.C.
xiv Garrity, D, Malesu, M, Khaka, E, Mati, B, De Bock, T,
The AdaptCost Project
The AdaptCost Africa project, funded by United
Nations Environment Programme (UNEP) under
the Climate Change – Norway Partnership, is
producing a range of estimates of the financial
needs for climate adaptation in Africa using
different evidence lines. The study aims:
 To help African policymakers and the
international climate change community to
establish a collective target for financing
adaptation in Africa.
 To investigate estimates to adapt to climate
change and improve understanding of
adaptation processes. This will provide useful
information
for
planning
adaptation
programmes and support decision-making by
national governments and multi- and bilateral
donors by allowing them to better compare
projects and policies on their economic
grounds. In the process, countries will also
gain a better understanding of their adaptation
investment requirements, and build a stronger
basis for articulating their financing priorities
and attracting capital.
This briefing note was prepared by Jillian
Dyszynski (SEI-Oxford Office).
Footnotes and References
Nyabenge, M, Oduor, V, and A Oduor. 2005. Potential for
Rainwater Harvesting in Africa: A GIS overview. Final Draft
Report. Volume 1. United Nations Environment Programme
(UNEP) & RELMA.
xv
Senkondo, E. M. M. et al., 2004. Profitability of rainwater
harvesting for agricultural production in selected semi-arid
i
Boko, M., I. Niang, A. Nyong, C. Vogel, A. Githeko, M.
Medany, B. Osman-Elasha, R. Tabo and P. Yanda, 2007:
Africa. Climate Change 2007: Impacts, Adaptation and
Vulnerability. Contribution of Working Group II to the Fourth
Assessment Report of the Intergovernmental Panel on Climate
Change, M.L. Parry, O.F. Canziani, J.P. Palutikof, P.J. van der
12
areas of Tanzania. Journal of Applied Irrigation Science,
39(1), 65-81.
xvi
Falkenmark, et al., 2007. “Agriculture, water, and
ecosystems: avoiding the costs of going too far.” Water for
Food, Water for Life, Molden (ed.). 233-277.
xvii
Molden, D., ed.. 2007. Water for Food, Water for Life: A
Comprehensive Assessment of Water Management in
Agriculture. International Water Management Institute (IWMI).
Earthscan, UK and USA.
13