Continued from previous page
| Table 4-11: Estimated national average annual costs
(US$ million) of impacts of climate change on water resources and riverine
flooding, UK, over next 30 years (ERM, 2000). |
 |
|
|
5% reduction in supply
by 2030
|
10% reduction in supply
by 2030
|
20% reduction in supply
by 2030
|
|
| Volume of water (Ml day-1) |
757
|
1514
|
3028
|
| |
|
|
|
| Supply-side |
|
|
|
| – Reservoirs |
3.3–25
|
6–50
|
12–100
|
| – Conjunctive use schemes |
140–1200
|
280–2430
|
570–4900
|
| – Bulk transfers |
0.5–90
|
1–175
|
2–360
|
| – Desalination |
4–12
|
10–24
|
19–48
|
|
|
| |
5% reduction in municipal
demand by 2030
|
10% reduction in municipal
demand by 2030
|
20% reduction in municipal
demand by 2030
|
|
|
| Volume of water (Ml day -1 |
420
|
835
|
1670
|
| |
|
|
|
| Demand management measures |
0.5
|
1
|
9
|
|
Aggregated estimates of the cost of impacts of climate change on water resources
have been prepared for Spain, the UK, and the United States. Ayala-Carcedo and
Iglesias-Lopez (2000) estimate that the reduction in water supplies under one
scenario would cost nearly US$17 billion (2000 values) between 2000 and 2060,
or about US$280 million yr-1 in terms of increased expenditure to
maintain supplies and lost agricultural production. A study in the UK estimated
the costs of climate change for water supply and flood protection (ERM, 2000).
Table 4-11 shows the costs (converted to US$) involved
in making up shortfalls of 5, 10, and 20% in the supply or demand across Britain,
under several different types of approaches (see Section 4.6.2).
The study assumes that the same change in water availability occurred across
all of Britain—which probably overstates the costs because many parts of
Britain are projected to have increased runoff—and estimated costs on the
basis of standardized costs per unit of water. The study does not consider the
feasibility of each of the potential adaptations. The cost of demand management
measures increases substantially for large reductions in demand because more
expensive technologies are needed. Note that a 5% reduction in demand represents
just more than half the water of a 5% increase in supply; reducing domestic
demand by 20% has a similar effect to increasing supply by 10%. The ERM study
assumes that annual riverine flood damages would increase, because of increased
flooding, by about US$80–170 million yr-1 over the next 30 years
(compared to a current figure of about US$450 million), and the average annual
cost of building structural works to prevent this extra flooding would be about
US$40 million.
There have been two sets of estimates of the aggregate cost of climate change
for water resources in the United States, using different approaches. Hurd et
al. (1999) examined four river basins under nine climate change scenarios (defining
fixed changes in temperature and precipitation) and extrapolated to the United
States as a whole. Their study uses detailed economic and hydrological modeling
and suggests that the largest costs would arise through maintaining water quality
at 1995 standards—US$5.68 billion yr-1 (1994 US$) by 2060 with
a temperature increase of 2.5°C and a 7% increase in precipitation—
and through lost hydropower production (US$2.75 billion yr-1 by 2060,
under the same scenario). Costs of maintaining public water supplies would be
small, and although loss of irrigation water would impact agricultural users,
changed cropping and irrigation patterns would mean that the economic losses
to agriculture would be less than US$0.94 billion yr-1 by 2060. However,
this study extrapolates from the four study catchments to the entire United
States by assuming that the same climate change would apply across the whole
country.
| Table 4-12: National average annual cost of maintaining
water supply-demand balance in the USA (Frederick and Schwarz, 1999). Values
in 1994 US$ billion. |
|
|
Management Strategy
|
HadCM2
|
CGCM1
|
|
|
|
“Efficient”
|
-4.7
|
105
|
|
“Environmental”
|
-4.7
|
251
|
|
“Institutional”
|
not calculated
|
171
|
|
Frederick and Schwarz (1999) take a different approach, looking at 18 major
water resource regions and 99 assessment subregions, with two climate change
scenarios for the 2030s based on climate model simulations. Water scarcity indices
were developed for each assessment subregion, comparing scarcities under “desired
streamflow conditions” and “critical streamflow conditions” on
the demand side with “mean streamflows” and “dry-condition streamflows”
on the supply side. These indices played a key role in determining the costs
of meeting various streamflow targets. A supply-demand balance in each region
is achieved through supply- and demand-side measures, each of which has an assumed
unit cost. Three strategies were defined for each region: “environmental,”
focusing on protecting the environment; “efficient,” maintaining supplies
to users; and “institutional,” placing limits on changes in environmental
indicators and the area of irrigation. The total national cost of climate change
was determined under each strategy by aggregating least-cost measures in each
subregion. Table 4-12 summarizes the estimated
national costs under the three strategies and two scenarios. The costs are considerably
greater under the drier CGCM1 scenario than under the wetter HadCM2 scenario
(which, in fact, implies a benefit), and they vary with management strategy.
Costs under the drier scenario are considerably higher than those estimated
by Hurd et al. (1999), reflecting partly the different approaches used and partly
the spatial variability in the effect of climate change considered by Frederick
and Schwarz (1999).
