Water Accounts at the EEA International Resource Panel ‘Water Footprint and Accounting’ Writing Workshop 4-6 April 2011 European Environment Agency (EEA) and United Nations Environment Programme (UNEP) Copenhagen, Denmark Water Accounts at the EEA Jean-Louis Weber Special Adviser on Economic Environnemental Accounting European Environment Agency jean-louis.weber@eea.europa.eu

Water accounts at the EEA Support to EEA reporting activities on water use and state Integration of the European information system on water (WISE, ECRINS) Support to the implementation of the European Water Framework Directive/ WFD Implementation of the UN-SEEA Water in Europe (altogether with Eurostat) Development of ecosystem capital accounts in relation to the SEEA revision and in response to policy demands for natural resource and macro-economic instruments (GDP and Beyond, Resource Efficiency Strategy...)

Support the implementation of the European Water Framework Directive Water Framework Directive key aims: expanding the scope of water protection to all waters, surface waters and groundwater achieving "good status" for all waters by a set deadline water management based on river basins "combined approach" of emission limit values and quality standards getting the prices right getting the citizen involved more closely streamlining legislation With a single system of water management: River basin management  DGENV requests water accounts to support WFD reporting

Macro-economics: GDP growth and the need to account for natural resource use & ecosystem capital degradation Resource efficiency = sparing materials & energy (technology, consumption patterns) 4.7 Mio km3 12.5 Mio km3 Use of accessible freshwater resource (today 54%) Resource efficiency = ecological management of land, soil & water, ecosystem capital maintenance  Beyond GDP 2008  “Stiglitz-Sen-Fitoussi” report 2009  TEEB 2008-2010  WAVES/ WB Partnership 2011-2015  SEEA2003 / rev. 2012-13 4

GDP: Concerns about meaning and measurement Bertrand de Jouvenel 1968: “Because National Accounts are based on financial transactions, they account nothing for Nature, to which we don’t owe anything in terms of payments but to which we owe everything in terms of livelihood.” Early “green GDP” adjustments: how to maintain national income when natural resource are depleting (“the weak sustainability”)? What are the “good” and “bad” components of GDP? (the first SEEA1993 – no implementation) More recently: Beyond GDP Conference, Brussels 2008: keep GDP but supplement it with indicators TEEB, 2008, GDP of the Poor Commission on the Measurement of Economic Performance and Social Progress (“Stiglitz report”), Paris 2009: National Income is more important than Gross domestic Product; Social distribution of Disposable Income still poorly addressed; “dual” issue of sustainability: overconsumption/ underinvestment Capital approaches: Early attempts at the World Bank: “Genuine or Adjusted Net Savings” Multi-capitals approaches of sustainable development: man-made, financial, natural, human, social Ecosystem approaches: Green Accounting for Indian States Project, Simplified Ecosystem Capital Accounts (EEA), SEEA revision... 5

Services & Natural assets accounts SEEA: Water accounts cover many aspects, interconnected and interconnecting Ecosystem accounts Services & Natural assets accounts The beauty of SEEA is that it does not restrict to one variable & embraces (in principle) the various aspects of water systems  even though water quantities accounts and associated monetary accounts are the first action, they should be followed quickly or accompanied by other modules quality of rivers, lakes, coastal waters, groundwater emissions to water from municipalities and sectors state of water ecosystems make sure that all aspects of water systems are covered incl. water in soil the spatial dimension of water is addressed correctly : water transfers are not all possible or sustainable time, variability are taken into account: impacts of periodic shortages might be huge

UN manual for environmental-economic accounting: SEEA2003 Enlargement of the System of National Accounts Revision  SEEA2012/13 Impacts on ecosystem capacity of delivering services/benefits RM HASSAN - UN The System of Environmental and Economic Accounting (UN 2003) - RANESA Workshop June 12-16, 2005 Maputo Part 1 The SNA satellite accounts for the environment expenditure, taxes, hybrid accounts, physical flows, sub-soil, energy, water, land, economic assets depletion Part 2 Ecosystem capital accounts Ecosystem stocks and quality, ecosystem services, benefits and maintenance costs… Negative feedbacks of ecosystem degradation on production and wellbeing

Ecosystem Services and Water in the draft Common International Classification of Ecosystem Services (CICES) Source, CICES proposal, Roy Haines-Young and Marion Potschin, eds, EEA, 2010

Simplified ecosystem capital accounting circuit GDP GDP & Adjustments:  Real Net National Income Final Consumption at Full Price Sustainable use Non-sustainable use Non-paid costs still needed to remediate ecosystem degradation (€) Ecosystem degraded by over-use Healthy ecosystem ES economic benefits (€) ES economic benefits (€) ES economic benefits (€) Economy Natural resources, ecosystem services (j) Ecosystem capital 9

Simplified ecosystem capital accounts Physical accounts firstly, followed by valuation of restoration costs and benefits supported by main ecosystem services All ecosystems: land/sea/atmosphere, and for land: urban, agriculture, forest, other natural land, inland water, and soil. Focus on ecosystem degradation and sustainable services Feasible NOW – keep it simple Don’t miss important issues: need a good checklist 6 indexes for 1 diagnosis: 1-Land // 2-Biomass // 3-Water // 4-Biodiversity // 5-Dependency from external inputs // 6-Disease prevalence Multi-criteria diagnosis (instead of mere additions) and quantification: the “ecosystem distress syndrome” approach combined with basic balances  “fast tract implementation of ecosystem capital accounts” in Europe Jean-Louis Weber, CBD Conférence, Libreville, 16 Septembre 2010

Importance of accounting by relevant functional units to measure impacts (e.g. catchments) West East The total water resource of the country 10 lakes distributed over 2 catchments. The western catchment with 2 lakes is close to a scarcity threshold while water resource is abundant in the eastern catchment (8 lakes). Scenario 1: 1 lake is lost in the east Scenario 2: 1 lake is lost in the west. Resource loss of 1 lake in the eastern catchment Aggregated national loss (without catchments): (10-9)% = 10% National average of loss by catchments: (2-2)% + (9-8)% 2 = 5.5% Resource loss of 1 lake in the western catchment Aggregated national loss (without catchments): (10-9)% = 10% National aggregation of loss by catchments: (2-1)% + (9-9)% 2 = 25%

Need relevant time frame for monitoring impacts on ecosystems: e. g Need relevant time frame for monitoring impacts on ecosystems: e.g. water resource/demand Mean annual resource is in both cases > mean annual demand No water shortage in case 1, important seasonal stress in case 2 1 2

Quality matters as much as Quantity Many other countries have similar quality maps The presence of certain types of watercourses and of their relative importance, expressed by the kmcn size, varies widely from a region of France to another. These differences are illustrated by the map ( Annex 1) which shows that the presence of certain types of water-courses is not ensured in all RNDE basins, and especially that the relative importance of these various types varies extremely from one region to another. It is noted in particular that the downstream reaches of the Rhone are of a considerable weight in the total kmcn of the "main rivers" class. It is clear that these results, presented within the framework of a pilot study based on data about which one could say they need some evaluation and improvement, have to be handled with precaution. The future developments of the quality accounts will have to set out of a database of the more complete water-courses than that currently used for the publication of the maps. However, it is recalled that the database CARTHAGE is not yet available for the whole European territory of France. Ex. FR, mid-1990,s, fast track computation river quality from maps (Source: Crouzet, Le Gall and Germain, IFEN)

Actual & virtual water embedded into trade Actual and virtual water trade between European river basins + Europe in the Global Ecosystem Actual & virtual water embedded into trade vs. water footprint impact (virtual water from non-sustainable origin) Evolution of the hydrological footprint per capita of the Community of Madrid (m3 per inhabitant per year) Source: José Manuel Naredo Pérez (Coordinador) et. al., El agua virtual y la huella hidrológica en la Comunidad de Madrid” © Canal de Isabel II - 2009

Need for thematic integration of water accounts with land, bio-carbon & biodiversity Example from southern Spain: NPP increase in dry region and water stress Much of the increased NPP in semi-arid Spain is due to new irrigations (water taken from aquifers or directly from rivers …) and land development More NPP brings functional simplification of the ecosystem; Such causal relations should be reflected in the “biodiversity account” (but the species responses are usually delayed due to nature’s buffering capacity) (from Emil D. Ivanov, EEA-ETC LUSI)  need for integrated monitoring and ecosystem accounting

Definition, mapping & classification of ecosystem capital units used for ecosystem capital accounting (Socio-Ecological Landscape Units - SELU), starting from river basins 1- river basins and 2- relief Courtesy Emil D. Ivanov, Oscar Gomez, 2011

Definition, mapping & classification of socio-ecological landscape units (SELU) 3- dominant landscape types (urban, intensive agriculture, mosaics, grassland, forests, other natural types and no-dominance) Courtesy Emil D. Ivanov, Alex Oulton, 2011

Application: NECB (net ecosystem carbon balance) here mean NECB value by SELUs within river basins boundaries Emil D. Ivanov, Jean-Louis Weber, 2011

Fast track implementation of ecosystem capital accounts: simplified basic water balance Meteo data Precipitation * - Spontaneous Real EvapoTranspiration ** + Net infiltration to soil/subsoil *** + Inflows from upstream runoff + Returns of used water & irrigation µ = Available water resource Use of water by activities & households µ Evapotranspiration by activities = River basin runoff Sources: * Meteo ** Modelling from meteo data, land cover & NDVI *** Hydrogeological modelling µ Estimation from land cover & socio-economic statistics Bold Ital: accounting balances Precipitation Evapotranspiration Use Runoff 19

Fast calculation for 3 Guadiana River sub-basins Water use / population 2 3 4 23 46 90 Estimated runoff Population Agriculture Available water resource 46 82 124 Precipitation 181 1008 1037 Consumption by irrigation 21 33 30 Spontaneous Real Evapo-Transpiration 984 934 137 Meteo data Source: EEA, Corine land cover, ECRINS – Estimations from various sources by Oscar Gomez Prieto & Jean-Louis Weber

Water quantity & quality data exist at the Global scale Meteo data Other EO data FAO water statistics Water Footprint database + ….  Source: Global threats to human water security and river biodiversity, CJ Vörösmarty et al. Nature 467, 555-561 (2010) doi:10.1038/nature09440

Environmental Cost of the WFD = CAR1 + CAR2 + CAR3 Joan Escriù Water Agency of Catalunya Economics: example of full cost accounting in response to WFD Environmental Cost of the WFD = CAR1 + CAR2 + CAR3 Cost of the “effective measures” for meeting the objetive of the WFD considered in the Programe of Measures of River Basin Management Plan PHYSICAL ACCOUNTS MONETARY ACCOUNTS Impacts on water use DA3 Cost of measures for resource procurement CAR3 Physico-chemical objectives Degradation of water quality DA1 recovery Cost of measures for mitigating impacts of uses over the water bodies CAR1 Biological & hydro-morphological objectives Impacts on ecosystems DA2 Cost of measures of ecosystem restoration CAR2 Courtesy Joan Escriu

Water Economics and Ecosystem Accounts at the EEA: Template for collating WFD economic data for the water account fast-track pilot project (1) Source: Water Economics and Ecosystem Accounts, Elements from the final study report dealing with the fast-track initiative – Pierre Stroesser et al. for EEA, Framework contract No. EEA/IEA/09/002 , 2010

Water Economics and Ecosystem Accounts at the EEA: Template for collating WFD economic data for the water account fast-track pilot project (1) Source: Water Economics and Ecosystem Accounts, Elements from the final study report dealing with the fast-track initiative – Pierre Stroesser et al. for EEA, Framework contract No. EEA/IEA/09/002 , 2010

Wuppertal Institut: José Acosta Fernández The benefits side: first step of the calculation of „inclusive sustainable benefits“ from the services of an ecosystem (e.g. agro-system, forest, fishery, hydrosystem...) Forward GVA/GDP effects by sector: Total quantity of Gross Value, which cannot be added by itself and by the users of the products of sector i, if sector i reduces or ceases its production Interpretation of „Total GVA-Effect Matrix“ resulting of the linkage of the „Total Effects/Flows Matrix“ of hypothetical extraction with the national Gross Value Added Backward GVA/GDP effects by sector: Total quantity of Gross Value, which cannot be added by itself and by the product suppliers of sector j, if sector j reduces or ceases its production Wuppertal Institut: José Acosta Fernández 02.06.2010 - EEA workshop

Water Accounts, Ecosystem Services & Human Wellbeing: Example of integrated water accounting by Artois-Picardie Basin Agency - France 20 000 Km2 4,7 Millions inhabitants GDP: 98 billions € GPD/inhabitant: 21 107 € GPD/inh France: 25 978 € Unemployment rate: 12,7% France: 9,9 % 96% of drinkable water come from groundwater Courtesy Arnaud Courtecuisse, Agence de l’Eau Artois-Picardie, France, 2006

Risk of not meeting WFD quality objectives by 2015 Courtesy Arnaud Courtecuisse, Agence de l’Eau Artois-Picardie, France, 2006

Water bill / mean available Income: social discrepancies several groups of municipalities with ratio>3% (2-3% is a guidance value – see OCDE, EU, Académie de l’eau) these groups of municipalities combine high water price and low mean available income (and sometimes household’s expenses to buy bottled water are equivalent to the annual water bill) Comparison with unemployment 2004 the commonly used value of annual consumption of 120 m3 per household hides important differences of mean consumption per region mean available income per municipality hides also various situations (and the real part of the population facing major difficulties to pay water bills) Courtesy Arnaud Courtecuisse, Agence de l’Eau Artois-Picardie, France, 2006

Thank you!