Choosing Wise Investments in Natural and Built Water Infrastructure

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Water security is vital for sustainable economic growth and poverty reduction, and hence water infrastructure is one cornerstone of development. Built water infrastructure safeguards water supplies and water quality and helps to reduce and avoid water-related disaster. Combined with hydropower and irrigation development, benefits include water, food and energy security, industrial development and wealth generation. Climate change is increasing demand for water infrastructure, especially in developing countries with high vulnerability. Ecosystem services are integral to outcomes from water infrastructure development, including climate resilience, but are often overlooked in investment decisions. The functioning of built water infrastructure itself and the livelihoods of poor people and key industry sectors rely on ecosystem services. However, services are lost when ecosystems are destroyed or damaged by the construction of dams, reservoirs, irrigation systems and canals, because for example wetlands may be drained or seasonal patterns of river flow and groundwater disrupted. Water infrastructure development for poverty alleviation is thus not a simple question of expanding the endowment of built water infrastructure, but involves trade-offs and synergies with ecosystems. These affect poor people and the success of poverty reduction. A critical challenge in developing water security for poverty reduction is to provide needed built water infrastructure while finding ways of sustaining ecosystem services. One approach is to recognise river basins themselves as infrastructure: they are 'natural infrastructure', providing provisioning, regulating, supporting and cultural ecosystem services, such as water storage, conveyance, flood regulation, safe water supply and water for food. Infrastructure planning and investment can then consider portfolios of infrastructure, based on the economic, social, and environmental costs and benefits of alternate mixes of natural and built infrastructure. The proposed project will develop a case for support and design a research programme to provide knowledge and tools needed to enable a portfolio approach to water infrastructure development combining built and natural infrastructure. This will be based on: - accounting of ecosystem services and their values; - use of mathematical optimisation techniques to identify mixes of natural and built infrastructure that prioritise the objectives of poor people and pro-poor growth. However, optimisation tools are not sufficient by themselves, as reality is complicated by unknowns, uncertainties, contested facts and complex systems. Decisions are shaped as much or more by politics and institutional constraints as scientific knowledge. Therefore research on ecosystem services, economic valuation and optimisation will be complemented by: - analysis of water governance, institutional arrangements and policies that enable unknowns and uncertainties to be managed effectively; - action research with policy makers and multi-stakeholder dialogues to test whether optimisation knowledge and tools can support consensus building and negotiation of infrastructure choices. The research programme will be implemented using a case study approach in river basins that will be selected in South Asia, sub-Saharan Africa and, potentially, Amazonia. Research activities will be complemented by capacity building with researchers and key stakeholders. The Partnerships and Project Development phase proposed here will follow a three stage process. Stage 1 will focus on case study identification and consortium mapping for the full proposal, Stage 2 on inter-disciplinary learning and research design, and Stage 3 on preparation of final outputs. In addition to the ESPA Consortium Grant proposal, output from this phase will include an impact pathways analysis for research on built and natural infrastructure to support capacity building.