Water finance, investment and pricing

 

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FINANCING INVESTMENT IN WATER SECURITY AND SUSTAINBLE GROWTH AT SCALE

Harnessing water to drive sustainable growth requires investments in water infrastructure, information and institutions. The Task Force on Water Security and Sustainable Growth has argued that the most beneficial investments in water security are sequenced along strategic pathways. Securing Water, Sustaining Growth documents some of the pathways taken by cities, aquifers, and basins to water security.

 


green talks on FINANCING WATER: INVESTING IN SUSTAINABLE GROWTH

When: Monday 9 April 2018 - Video recording forthcoming

Green Talks Live Financing water‌Achieving the Sustainable Development Goals will require a historic scaling up of investment in water.

The benefits from strategic investment in water security could exceed hundreds of billions of dollars annually by delivering valuable water services and reducing risks of flood and drought. To date, a strong economic case for water-related investment has failed to translate into a compelling financing case at scale globally.

What policies and financing approaches can help to unlock investment and mobilise additional sources of capital? How to ensure that financing flows to investments that contribute most to water security and sustainable growth?

Join Haje Schütte of the OECD Development Co-operation Directorate, Xavier Leflaive and Kathleen Dominique of the OECD Environment Directorate, and Ms. Esther Delbourg, Head of Responsible Insurance at AXA, to discuss the challenges of financing water, innovative solutions and ways forward to accelerate action. The presentation will draw on emerging messages from The Roundtable on Financing Water.

POLICY PERSPECTIVES: FINANCING WATER

This Policy Perspectives on Financing water: Investing in sustainable growth summarises key messages about the economic case for water investment, the barriers to investment and the financing gap. It charts a course for action to better value water and to facilitate water investment at scale. The Roundtable on Water Financing, a joint initiative of the OECD, the World Water Council and the Netherlands, will continue to deepen the evidence base and broaden engagement on these issues.

POLICY HIGHLIGHTS: WATER, GROWTH AND FINANCE

The Policy Highlights on Water, Growth and Finance argues that the issue is not only about raising more finance. It is about four inter-related pillars:

  • Maximise the value of existing water security investments.
  • Select investment pathways that reduce water risks at least cost over time.
  • Ensure synergies and complementarities with investments in other sectors.
  • Scale-up financing through risk-return allocation schemes.


How come the strong economic case for investment in water security does not materialise in financial flows at scale? The 2nd Roundtable on Financing Water (2nd meeting) was set up to investigate this issue and derive answers. It brought financers from diverse background, including development finance, institutional investors and commercial banks; and institutions in charge of infrastructure planning. Preliminary outcomes will be delivered at the World Water Forum in Brasilia in 2018.

pricing water and water services as a policy tool

Putting a price on water can signal its scarcity or the cost of pollution. As such, prices can promote water efficiency. The policy dialogues in Brazil and Korea provide concrete illustrations and practical discussions on the reform of pricing instruments for water management (abstraction charges, pollution charges).

Charging for water services can also generate revenues to finance these services. Lessons can be learned from good international practice. The social consequences of pricing deserve particular attention. The Expert Commission on water set up in 2016 in Ireland – in which the OECD participated - provides ample illustrations of the debates that accompany the reform of water charges in an OECD country.

 

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