The economics of climate change Tanzania: water resources

Abstract

Water resources are critical to Tanzania’s economy: water is key to agricultural sector performance; piped water systems provide input into industrial production and support the workforce in urban areas; water in rivers and reservoirs generate over half of the country’s grid electricity through hydropower works; and water flows through the ecosystem provide numerous provisioning services while also supporting the tourism sector. With renewable water resources per capita of 2,291 m3, Tanzania is currently not classified as water scarce but - due to projected population growth - it is expected to be so by 2015. The country is also challenged by a high degree of water resource variability, both spatially and temporally. National mean annual rainfall is 1,071 mm, but the Lake Tanganyika basin and the southern highlands can receive up to 3,000 mm annually while about half the country receives less than 762 mm annually. Temporally, the northern parts of Tanzania experience a bimodal rainfall pattern (long rains from March to May and short rains from October to December) while the rest of country is unimodal, with the majority of rainfall coming between December and April. The El Niño/La Niña South Oscillation (ENSO) phenomenon can also result in substantial impacts on intraseasonal rainfall variability. A number of studies projecting the impact of climate change on water resources in Tanzania have been undertaken, ranging from Mwandosya et al. prepared over the period 1994-1998 to the most recent by University of Cape Town’s Climate System Analysis Group (CSAG), completed in 2010. Most studies used multiple General Circulation Models and generally concluded that while future rainfall patterns were uncertain, some parts of the country may receive more rainfall under various climate change scenarios and other areas, especially the central region, might receive less; the CSAG study also suggested there would be a seasonal shift in rains, with less rainfall early in the season and stronger rains later in the season, which agrees with another major study (Hulme et al., 2001) on projected rainfall changes in East Africa. In terms of temperature increases, the two studies concluded that these would be in the range of 1.5°C - 2°C for the first half of this century and around 2°C - 4°C for the second half. These findings are also within the range predicted for East Africa by the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. In terms of the impact of climate change on water flows in Tanzania, there is much less agreement: Mwandosya et al. (1998) predicts increased flows in the Rufiji basin and decreased flows in two other key basins (Wami-Ruvu and Pangani); another study (de Wit and Stankiewicz, 2006) projects a rise in perennial drainage to a total of 136% in central Tanzania and 125% in northwest Tanzania by the end of this century; and a third study (Strzpeck and McCluskey, 2006) suggests by mid-century on a national basis streamflows will be between 80-100% of 1961-1990 flows and only 80-90% of the base period flows by 2100. Finally, in assessing the predictions of these studies, it must be noted that other drivers of climate and water resources, such as land use change and the impact of ENSO, were often either not considered or inadequately incorporated into the analyses. This issue, coupled with widely-ranging predictions on population growth and the rate of urbanization, means that a key challenge for Tanzania in terms of planning adaptation strategies will be the high degree of uncertainty about its future climate. Piped water systems in the largest cities in Tanzania source their water from the country’s rivers; urban areas also use groundwater as a supplemental source to meet demand. In rural areas, domestic water comes from surface water (rivers and springs) and from groundwater accessed through public and private wells. Due to rapid urbanization, access to improved sources of drinking water has actually declined over the last decade, though there has been an upward trend since 2005; currently, about 56% of Tanzanians have access to an improved source of drinking water. Urban water supply issues include over abstraction of flows upstream and catchment degradation; in rural areas, non-functionality of waterpoints is an additional problem. Possible lower and/or intraseasonal shifts in rainfall and/or lower river flows, combined with population growth and urbanization rates, will complicate planning for adaptation in Tanzania’s domestic water supply sector. However, there are no regrets strategies the country could pursue immediately: demand management for both urban and rural areas and mapping of waterpoints to ensure sustainability in rural areas. Water basin management programmes would also be effective for both urban areas as Tanzania approaches water scarcity: these programmes could be instrumental in managing both water quality and quantity while simultaneously benefiting other sectors (agriculture, ecosystems and hydropower). In urban areas, adaptation may also requiring accessing deeper sources of groundwater, as shallow wells become unusable. Eventually, infrastructure may be required for increased storage capacity, such as the construction of a reservoir in the Ruvu basin to store water for Dar es Salaam or even the more costly measure of switching to the Rufiji River to supply water to the capital. For rural areas, groundwater wells and rainwater harvesting structures can help residents adapt when aquifers subside or dry up due to climate change-induced slower rates of recharge; as with urban areas, shallower wells will need to be replaced by deeper – and more expensive – boreholes. The estimated cost of upgrading Tanzanians living in rural areas without improved drinking water from shallow wells and springs to small piped systems drawing on boreholes and springs would be US$23 million. The majority of Tanzania’s power generation – 55% - comes from hydropower. Previously, Tanzania’s reliance on hydropower was much higher - in 2002, 97% of the country’s grid-based electricity came from hydropower – but recurrent droughts leading to power rationing have caused huge losses to the economy: 1.1% slower growth in 2007; a 0.9% drop in 1997; and a decline of 3.8% in industrial growth in 1994. According to a 2010 World Bank report, the economic cost of power shortages in terms of the cost to businesses of running backup generators and the losses from foregone production has resulted in a loss of over 4% of GDP annually; these power shortages also act as a drag on economic growth in the long term. The situation is only expected to worsen: a 2009 study that considered possible impacts on hydropower by 2030 under ‘moderate climate change’ and ‘high climate change’ scenarios projected losses of 0.7% and 1.7% of GDP due to decreased rainfall in the central region of Tanzania, where 95% of the country’s hydropower installations are expected to be located by 2030. An even greater climate change-related impact on hydropower is expected to come from increased evaporation of water from reservoir surfaces due to higher temperature: the worldwide average is 5% of gross reservoir capacity is lost per year due to evaporation. However, given that Tanzania is near the equator, this figure is probably low and the projected increases in temperature over this century will further increase losses; modeling of reservoir losses under different climate scenarios is needed to accurately assess future climate impacts on hydropower. For adaptation strategies, demand management, including reducing transmission losses, would be a no regrets strategy, given that power generation is already insufficient to meet existing demand. Diversification of energy sources away from over reliance on hydropower would also be an effective adaptation measure. This would include shifting to renewables (solar, wind, geothermal and sustainable biomass) towards a low carbon growth path, which would have the added benefit of preserving the country’s ability to access carbon finance incentives and avoid future economic impacts from a possible carbon tax. Pursuing a grid interconnection with neighboring countries would be another diversification strategy, addressing both the challenge of inadequate power supplies and the high cost per kilowatt hour. Lastly, basin catchment programmes – managing land use upstream of hydropower dams – would be another cost-effective measure.