26 Making efficient use of water and energy in parallel can transform development regimes and foster growth. The WPP is influencing the core of the waterenergy nexus. The Program shows how mitigation incentives can bring energy efficiency improvements to water services in India and how solar-powered desalination can lead a region toward adaptation. It is also helping Central Asia and Africa re-engage in large-scale hydropower, and getting Bosnia and Herzegovina back on track to meet development objectives by securing energy sources. 2.4.1. Mitigation Drives Efficiency Improving energy efficiency in water service delivery offers two benefits: it helps service providers cut costs and contributes to climate change mitigation and adaptation. Energy efficiency in the urban water sector has proven to be an effective way to drive greener practices. The WPP supported a market scoping study to identify where and how energy efficiency improvements could be made in India’s urban water sector. The urban water supply system is currently operating with low levels of efficiency. Electricity costs represent 50 percent of the total operation and maintenance expenditure, and nonrevenue water is as high as 45 percent for some utilities. The team identified the key market players, developed cost-effective technical solutions, and shared their results with water utilities across the country. The report had a direct impact on the Bank-funded Karnataka Municipal Water Energy Project, which rolled out one pilot project in each of six municipalities. Under these pilots, funded by the state, utilities are replacing old pumps with more energy efficient models. The cost of the program was about $800,000 and is expected to lower operating costs by between 20 and 25 percent and save 16 million kWh per year. Over ten years, the pilot will offset CO2 emissions by about 135,000 tons. The Bank is preparing a follow-on Urban Water Supply Project in Karnataka, which is being informed by the lessons learned on energy efficiency from this activity. The client is also interested in scaling-up energy efficiency program to other towns and to other sectors, like wastewater, street lighting, and government buildings. Mitigation is also a promising avenue for developing countries in the Middle East and North Africa (MNA). The MNA region is facing real water security challenges. In arid, coastal cities, water demand is often met through large-scale desalination systems powered by fossil fuels. While groundwater
and surface water resources are diminishing due to population growth and climate change, more desalination plants will be required to meet the water demand gap. The region is also oil abundant, and fossil fuels are often provided at little to no cost to water companies to run their treatment plants. With rising fuel prices, however, many countries are starting to look to solar power, another abundant resource, to run their massive water infrastructure. Desalination thus presents an opportunity for developing countries to meet their water supply needs while at the same time developing their renewable energy potential. To support research on potential projects in this area, the WPP funded a study entitled MNA Regional Water Outlook: Desalination Using Renewable Energy. The study covers 21 countries and assesses water availability and demand projections, as well as implications of climate change impacts on water in the MNA up to 2050. The assessment focuses on the use of concentrated solar power as a reliable energy source for the region. By presenting information on the generation potential and associated costs of desalination, the study is the first step in helping countries determine whether to promote such strategies in the long term. 2.4.2. Regional Cooperation for Shared Security Central Asia has historically used hydropower as a significant energy source, but water resources are drying up. Since the breakup of the Soviet Union, hydropower infrastructure has operated at the national, rather than the regional level. This scenario, along with a lack of regional trade mechanisms, has resulted in less optimal use of water for irrigation and for energy. An integrated understanding of energy and water variability, as impacted by climate change, is necessary to effectively allocate resources and drive future investments for joint resource optimization (see figure 4). The Bank is embarking on a Central Asia WaterEnergy Development Program under which an Energy Sector Management Assistance Program (ESMAP) for the region will be developed. As part of this program, the HEF supported a workshop in Kazakhstan, led by world renowned experts, to encourage dialogue among regional institutions responsible for WRM in the five Central Asian republics.4 The workshop explored power and non-power operating constraints, and the challenges of hydrologic data generation. HEF used the workshop as an opportunity to transform the way that practitioners approach the energy-water nexus. Experts demonstrated how, by using innovative