Ecological Economics of Water: Water Systems, Water Footprints,

and the Real Price of Water

CANUSSEE, Vancouver, October 3, 2015Teaching Ecological Economics II

Anne-Marie CodurGlobal Development and Environment Institute,

Tufts University

The composition of the planet’s water

0 1000 1700 2500 6000 15000 70000

Data not available

Cubic meters per person per year

Water scarce Water stressed

Global Freshwater Availability

Region Average water availability (cubic meters/person)

Middle East and North Africa 500

Sub-Saharan Africa 1,000

Caribbean 2,466

Asia/Pacific 2,970

Europe 4,741

Latin America 7,200

North America (including Mexico) 13,401

Water Availability per region (2012)

Water scarcity and conflicts

The uses of water, global average

Calculating water footprint: Step 1: decomposing water in 3 types

Calculating water footprint: Step 2: adding all the water (green, blue, grey) necessary throughout the process of production of each good = virtual water

Product Virtual-water content (liters)

1 sheet of paper (80 g/m2) 101 tomato (70 g) 131 slice of bread (30 g) 401 orange (100 g) 501 apple (100 g) 701 glass of beer (250 ml) 751 glass of wine (125 ml) 1201 egg (40 g) 1351 glass of orange juice (200 ml) 1701 bag of potato crisps (200 g) 1851 glass of milk (200 ml) 2001 hamburger (150 g) 2,4001 cotton T-shirt 2,7001 pair of shoes (bovine leather) 8,000

 Type of fuel

Amount of water needed in the extraction/production of 2 Million BTUs of energy

Natural Gas (conventional) 5 gallons

Unconventional natural gas (shale) 33 gallons

Oil (conventional) 32 gallons

Oil tar sands (mining) 616 gallons

Biofuel type 1 (irrigated corn) 35,616 gallons

Biofuel type 2 (irrigated soy) 100,591 gallons

Virtual water used in six types of fuels, for a round trip New York City- Washington D.C.

Calculate your own water footprint: direct water use + virtual water of all goods and services

http://www.gracelinks.org/1408/water-footprint-calculator

The average person living in the US consumes about 2220 gallons of water a day - That’s 8,500 liters or 25 bathtubs each day

Diet makes a huge difference:Meat eater = 30 bathtubs Vegetarian = 15 bathtubs Vegan = 12 bathtubs

National Water Footprint for selected countries, in cubic meters per person per year

Transfers of virtual water through tradeVirtual-water balance per country

(billion cubic meters)

Trade of virtual water : cotton

Addressing water shortagesIncreasing water supply? Not the Solution! •Dams (dramatic ecological and social consequences); •Pumping aquifers (20% aquifers are already being mined beyond their rate of recharge); •Desalination: energy-intensive and costly. In California: $1800-$2800 per AFGroundwater: $375-$1100 per AFSurface water: $400-$800 per AF

•WATER CONSERVATIONMicro-irrigation – reuse and recycle wastewaterCost of conservation (San Diego’s county): $150-$1000 per AF

How to promote water efficiency?

Governmental regulation

“Today we are standing on dry grass where there should be five feet of snow. This historic drought demands unprecedented action.”

- California Governor, Jerry Brown, April 1, 2015

Demand

Supply (MC)

Marginal Social Cost (MSC)

Price

Quantity of WaterQSQEQ*

PE

PS

P* A B C

Regulation by the market: internalizing negative externalities

Subsidies to irrigation lead to a consumption of Quantity Qs of waterQe would be the market equilibrium without subsidiesQ* would be the ecologically optimal quantity withdrawn

Pric

e pe

r U

nit

Quantity of Water Used

Uniform Rate Structure

Pric

e pe

r U

nit

Quantity of Water Used

Increasing Block Rate Structure

Pric

e pe

r U

nit

Quantity of Water Used

Decreasing Block Rate Structure

Pricing Structures

A few American Cities applying the increasing bloc rate structure

Markets of water-rights for big users (irrigators, industries, cities):

“cap-and-trade” systems for water conservation?

• Water markets are in place in several countries, including Australia, Chile, South Africa, the United Kingdom, and the United States.

• In the US, Municipalities were the most common purchaser of water (mostly from irrigators), but transfers between irrigators were also common. About 17 percent of the water purchased was for environmental purposes, including purchases by municipalities and environmental organizations. Some analysts see great potential for water markets to improve the environment

Water Management and Governance: what institutional frameworks for Water conservation?

• State control? Public services in developing countries have often proven inefficient and corrupt

• Privatization? Promoted by World Bank and IMF – but without appropriate regulation, water companies can charge excessive rates and fail to address the needs of the poorest

The “Water War” in Cochabamba, Bolivia, 2000

The acequias of New Mexico are communal irrigation canals, a way to share water for agriculture in a dry land.

“Communities have relied on institutions resembling neither the state nor the market to govern some resource systems with reasonable degrees of success over long periods of time ” - Elinor Ostrom, in “Governing the Commons” (1990)

Re-creating collective systems of management of the commons?

Movement for the re-municipalization of water

THANK YOU!