THE VALUE OF RAIN
A study, presented during the 2014 World Water Week, showed how to link water footprint and ecosystem services valuation to identify the value of rain in Santa Cruz (Bolivia) region. This study was done in partnership with Forest Trends, the Swiss Development and Cooperation Agency, Fundacion Natura Bolivia and Quantis.
A recent publication by the World Economic Forum regarding the global risk landscape found that water is the risk that could have the highest impact globally. Water management and stewardship is still a challenge for most organizations and communities.
The recent increase of interest for ecosystem services valuation and water footprint highlights the potential of these new metrics to guide decision-making towards more sustainable choices.
The study in question, presented at the 2014 World Water Week (at the Water Footprint Network annual meeting), is focused on the dependency of the agricultural sector of the Santa Cruz region in Bolivia on water related ecosystem services. I was the first author leading the study while at Quantis and I am still exchanging with Forest Trends to develop further knowledge in this field.
We explored in particular the link between forests ecosystems and soybean farmers, based on two different ecosystem services (see figure below): local climate regulation with rainfall provision and freshwater provision. We used the green and blue water footprint indicators from the Water Footprint Network to measure those ecosystem services. The soybean farmers were targeted first as they represent nearly half of the water footprint of the agricultural sector in the region.
The valuation of the rainwater ecosystem service was based on local statistics linking yield changes to precipitation data, thus measuring a marginal value. We found an average value for green water of 0.05 USD/m3.
The valuation of the freshwater ecosystem service was based on the potential future value it could bring to farmers, as irrigation is not widespread at the moment. We estimated, based on a local study, the potential yield increase as a result of irrigation. We found an average value for blue water of 0.5 USD/m3. This value is higher than the green water value. This difference of value can also be explained by the fact that blue water is available when crops need it the most and freshwater is generally more scarce, increasing its value.
The link between those two ecosystem services, green and blue water, and forests was done thanks to selected literature that established the same link in other places like the Amazon region, although it was not possible to rely on local data in our case. We identified three main forests ecosystems as being critical to maintaining the local rainfall (green water): the local Andean forest, the Amazon forest and the local forest in Santa Cruz. The Andean forest is particularly important to support the provision of freshwater.
This analysis was used to derive scenarios at regional level. We identified that the potential reduced rainfall due to climate change could cost the soybean sector in the integrated region of Santa Cruz USD 30 million per year. We also identified that the future potential net value of freshwater for the soybean sector might be of USD 462 million per year.
The interpretation of the results is however still ongoing and a report will soon be published. More information will be available shortly.