The nexus of water, energy and food issues is at the heart of many global problems that have proved difficult to solve. Collective action around water can play an important role in identifying solutions that combat climate change.
As one of the givers of life itself, and a resource that is finite in quantity, water is the ultimate cross-cutting issue. We all need water, so addressing water-related issues naturally lends itself to collective action. But as a cross-cutting issue, water cannot be viewed in isolation. The growing prominence of the water-energy-food nexus in development discourses and policies is a vital piece of the climate change puzzle. The challenge is to make this collaborative thinking operational by developing workable yet meaningful solutions.
POSITIVE OUTCOMES FROM RIO+20
Despite the widespread (and probably predictable) disappointment with the Rio+20 outcome document, two really positive things stood out from the overall Rio programme:
The water-food-energy nexus – an approach that integrates the management and governance of these three critical issues – was promoted strongly by some key players, including the German government. Although on a conceptual level this nexus clearly makes sense, it takes courage to explore the unexplored and face the inevitable uncertainties. In the lead-up to the Rio conference, and following on from it, the nexus approach has gained significant momentum that must now be translated into meaningful action.
The critical role of business in building a more sustainable economy also came through strongly, especially at the Corporate Sustainability Forum hosted by the UN Global Compact in Rio. Circumstances at the time added emphasis to this point: at the same time as government representatives in Rio were steadily chipping away at the teeth of the outcome document, and G20 leaders were in Mexico, with those to whom the world has traditionally looked for solutions – North America and Europe – increasingly hamstrung by their sovereign debt, business leaders in Rio were announcing significant commitments to sustainable development. This other ‘nexus moment’ was indicative of the changing political context in which the sustainable development agenda is being played out – we cannot expect one sector or organisation, no matter how big, to deal with the range of issues that is becoming more complex by the day. Business can and must play a leadership role, and should do so in partnership with the governments, NGOs, academia and civil society.
The nexus approach has gained significant momentum that must now be translated into meaningful action.
WHY THE NEXUS MATTERS
Economic growth is still widely seen as a vital prerequisite for sustainable human development. Achieving and maintaining a desirable level of economic growth is something for which all governments strive, but doing so needs ever-increasing amounts of energy. Even with moves towards ‘green growth’, BP estimates that global energy demand will increase by around 40 per cent over the next 20 years, with the overwhelming majority of this growth coming from emerging economies. Whichever way we choose to meet increased energy demand, there will be implications for food security and fresh water resources.
Managed poorly, increased water use in energy production, for example through increased biofuel production, could jeopardise food security and other economic activity in a world that already has more than 7 billion human inhabitants, nearly 1 billion of whom are undernourished. It is not just biofuels that impact water resources – extracting, refining, processing, and transporting all forms of energy requires large quantities of water, as do cooling processes in conventional thermoelectric power plants. At the same time, heating, treating and moving water consumes vast amounts of energy. For example, in California, water-related energy use accounts for 19 per cent of the state’s electricity use and 30 per cent of its natural gas. Competing demand for scarce water resources will lead to inevitable trade-offs between water for food production, water for energy production and water for direct human consumption. Seen in this way, water is at the centre of the water-energy-food nexus.
Extracting, refining, processing, and transporting all forms of energy requires large quantities of water.
As we continue to develop ways of managing water resources more equitably and sustainably, we do so in an environment inextricably linked to energy, food and climate change. This environment demands cross-sectoral collaboration as the best pathway to lasting solutions. It is no longer acceptable to view water as a stand-alone issue, ignoring the implications on energy and food security. This environment compels us to look beyond sector-specific approaches, and forces governments, multilateral agencies, international organisations, the private sector and civil society to work collectively to address the issues. With the International Water Stewardship Standard, AWS is providing a vehicle to drive that cross-thematic and cross-sectoral engagement from which nexus solutions will emerge.
USING WATER AS THE SPRINGBOARD
Although at first glance the AWS Standard is a water-specific approach, it is designed to exist within a broader system that engages all sectors in driving consensus-based responses to shared water risk. This cross-sectoral approach is not limited to those who directly use a lot of water; rather, it includes all who have an interest in promoting healthy watersheds. In this way, by focusing on collective engagement on water, the range of perspectives needed to identify cross-sectoral solutions is hard-wired into the AWS system.
Similarly, there is a growing range of examples of corporate leadership in collective action around water that can be built on to address other elements of the nexus. For example, at Rio the heads of 45 UN CEO Water Mandate endorsing companies called on governments to join them in making global water security a top priority.
This corporate commitment provides a golden opportunity to address other elements than water.
A company with water risks also has energy risks. Many or most of the signing CEOs lead companies that depend on agricultural supplies. If addressing shared water risk is done in a way that is sensitive to energy and food security then it becomes a truly positive-sum game.
One of the advantages of focusing on water is its tangibility. Water issues are ‘here and now’, whereas carbon, by contrast, is ‘where and when?’ A company or community that fails to address water risks in a given location should not be surprised at the consequences. But by understanding the shared nature of water risk, and adopting a collective approach to managing it, there is the potential for physical benefits (enough clean water), greater clarity on respective roles (for example, technical innovation being led by the private sector, consensus-building being led by civil society and governments managing natural resources in the public interest), and increased levels of trust. This trust can be used to move the needle on other nexus issues too.
There are several tools and approaches already in place that aim to build collective action around shared water risk. At AWS we are drawing together businesses, public sector agencies and civil society around the stakeholder-endorsed International Water Stewardship Standard. The UN CEO Water Mandate is developing collective action guidelines and platforms for its corporate endorsers. These and other initiatives can be springboards for building collective cross-sectoral action. And importantly, they provide businesses with what they need to take a leadership role.
ADDRESSING THE NEXUS COLLECTIVELY
There are at least three ways in which collective action on water can drive collective action on the nexus, starting today:
Adopt a holistic approach to risk management
From a business perspective, sustainability and resilience are centred on managing risk. With water, there are several tools available to help business to measure their water use, understand their water risk and make informed decisions on responses. Although still an evolving space, water stewardship based on a risk approach has already proved successful in building understanding across stakeholder groups and encouraging informed and targeted interventions. This same approach – understanding and managing shared risk – can be employed across the energy and food issues as well. Doing so will require the tools to enable companies to assess their risks in a holistic way, and a way that is both practical and meaningful. Providing a simple yet meaningful approach to an inherently complex problem is a challenge, but the severity of the situation demands that we accept this challenge. With our multi-stakeholder and multi-user approach, the AWS International Water Stewardship Standard provides a good starting point for meeting this challenge.
Incentivise good performance
We need to find a practical way to incentivise good performance on nexus issues, even if a business is not excessively exposed to associated risks. Again, we can build on existing water-related approaches and lessons learned. For example, at AWS, we are using recognition of compliance with best practice on water stewardship to incentivise improved performance. Because water stewardship is a collective approach we are also aiming to incentivise promotion of good performance, for example through supply chains, policy choices or investment or financing decisions. Incentivising performance in the nexus calls for closer collaboration between sector- and commodity-specific approaches. It should be more about bringing related pieces together rather than creating nexus-specific incentives. For example, voluntary standards and certification systems for water, energy and agricultural commodities should join forces to create a landscape that delivers associated benefits in a way that is accessible for business.
There is one vital prerequisite for achieving better understanding of shared risk and incentivising performance: building bridges between stakeholders.
The complexity and urgency of the issues we are facing demand that we all escape from our sectoral or thematic silos.
Again, the tangibility of water provides examples of good practice in collaboration and mechanisms to assist a collective approach, including the AWS Standard.
We must move quickly, progress beyond exploration and identify and test solutions that meet communities’ needs while being workable for business and ensuring the health of our environment. In doing so, we need to embrace the inevitable failures and setbacks as part of a learning process. Rio has shown that major businesses around the world recognise the need for a collaborative approach and are ready and able to play a leading role in driving nexus solutions.
This article was originally published on Climate Action 2012-2013 (www.climateactionprogramme.org)
Adrian Sym is Executive Director of the Alliance for Water Stewardship and has devoted his energy to development issues, initially working on disability-related programmes in Bangladesh and Nepal, before moving to the world of social and environmental standard setting. Adrian joined the Alliance in 2011.
The Alliance for Water Stewardship (AWS) brings together some of the world’s leading players in sustainable water resource management. Through building and making operational an international water stewardship system, at the heart of which will be the stakeholder-endorsed International Water Stewardship Standard, AWS is driving verified, watershed-level responses to shared water risk that benefit people, nature and the economy.