Modelling the impact of climate change and variability on water availability and economic likelihood: an example from the Caribbean

Transcription

1 Sustainable Development, Vol Modelling the impact of climate change and variability on water availability and economic likelihood: an example from the Caribbean A. A. Gohar 1,2 & A. Cashman 1 1 Centre for Resource Management and Environmental Studies, The University of the West Indies, Barbados 2 College of Agriculture, South Valley University, Egypt Abstract Climate change and variability continues to receive attention as a major challenge for water resources, food security, and economic wellbeing especially in tropical SIDS. Research on climate change and variability has tended to concentrate on the physical dimension, yet less attention has been paid to the consequences for human and economic related activities. This research aims to investigate the impact of climate change and variability on water availability, food security, agricultural land use, and economic wellbeing in a tropical environment. An optimizing framework has been developed which balanced those competing demands. Results indicate that climate change has a greater negative impact on water availability and food security as compared to the impact of climate variability, where variability tends to mitigate the impact of the climate changes. The consequences of climate changeability are unevenly distributed across economic sectors and users. Consumers experience the negative consequences particularly when water abstraction is constrained for sustainability purpose. The approach provides a comprehensive tool for explaining the effectiveness of adaptation measures and possible policy response. Keywords: climate change, climate variability, water availability, food security, water demand, positive mathematical programming. doi: /sd150922

2 1062 Sustainable Development, Vol. 2 1 Introduction Water availability is a fundamental factor determining the stability and sustainability of regional and national economic development. According to recent research, tropical regions are more vulnerable to climate change and variability. Whilst the physical effects of climate change on water resources and supply have received attention, less has been paid to the potential impacts on economic welfare. Understanding the relationship between changes in water availability induced by climate change and variability and socioeconomic variables such as food security and economic wellbeing is critical to more efficient and sustainable management of water resource. This research aims to fill this gap by investigating simultaneously the impact on climate change and variability on future water resources sustainability, food security, and national economic livelihood within the context of adaptation measures and the use of subsidies. This is achieved through modeling the impact of several climatic scenarios on groundwater storage subjected to varying urban and agricultural water demand pressure. Economic welfare is examined through investigating the change in water demand, consumer surplus, and producer surplus among urban and agricultural sectors. This framework is applied for the Caribbean Island of Barbados. Diminishing water availability induced by climate alteration could produce negative impacts on both ecosystem and human activities. One of the concerns is that greater variability in precipitation could lead to regional and national food insecurity [1, 2]. As a result, the economic stability and sustainability of regional and national development could be strained. However, given the uncertainty associated with climate change and variability projections, especially at the national scale, the magnitude of such impacts will depend on the severity of the change, and a country s institutional capacity. The Caribbean Region is likely to experience higher atmospheric temperature and greater variability in precipitation which would increase the frequency and severity of droughts and floods [3]. These impacts would include decreases in groundwater recharge placing stress on food production. Conversely water demand for the domestic, services, and tourism sectors are expected to increase in near future as those sectors continue to drive Caribbean economies [4]. Food security and selfsufficiency is becoming greater national priority in many Caribbean states as result of global increase in food prices in the mid-2000s. As a result, several governments have tried to reduce their food import dependency and pay more attention to agricultural adaptation policies [5, 6]. Like many Caribbean states, Barbados will face real challenges in meeting increased water demand for food production, urbanization, and the protection of its ecosystems. The country is classified as water stressed, which adds to its vulnerability to climate change and variability. The country relies on its groundwater aquifer system to meet urban water demand. Geologically, 86% of the island is composed of karstic coral limestone. This forms the groundwater aquifer used to meet the water needs of the island. Barbados has achieved nearly 100% access to potable water supplies for the population. Water use is charged

3 Sustainable Development, Vol for volume used, with differentiated tariff schemes depending on what it used for domestic, commercial, cruise ship or agricultural purposes. Tariffs are also stepped with an increasing tariff for greater volumetric use. 2 Data and methodology 2.1 Data integration The Barbados Water Authority (BWA) provided data on precipitation for the period ( ). Population growth, household size, hotel occupation, cruise ship arrival, number of commercial, governmental, and statutory corporation and water consumption were obtained from the Ministry of Finance and Economic Affairs over the same time period from annual reports. Farm budget information include crop irrigation, crop yields, cost of production, crop wholesale prices and groundwater pumping cost was obtained from the Ministry of Agriculture. Land use information such as uncultivated land, vacant area, golf course, residential, commercial land, transportation network land, gullies, and forested areas. The average crop water requirements were taken from the FAO, Natural Resources Management and Environmental Department. Table 1 shows a part of input data used in our framework. 2.2 Modelling framework A constrained mathematical framework that maximizes the total economic welfare from water allocation for irrigation and urban uses under four climate scenarios has been developed using General Algebraic Modelling System software (GAMS). The impact of two alternative groundwater pumping policies; constrained pumping and non-constrained pumping were investigated. The framework incorporates six water use subsectors; domestic, tourism, cruise ships, commercial, governmental, and statutory corporation in addition to agricultural sector. Twelve crops, 6 land uses, and two watering systems; rainfed and drip irrigation were incorporated. The analyses are carried out over a 20 year period. The major advantage of the current analysis is that it investigates the potential impact of climatic scenarios on farm income, urban welfare, food security, land uses, and water availability within a single framework. The major components of our framework mathematical documentation and GAMS code are available by the request from authors. A distinction is made between climate change, climate variability, and the dual exposure resulting from climate change and variability together on water availability, food security, and farming livelihoods. Katz and Brown [7] defined as long run shift in average precipitation resulting from natural variability or anthropogenic factors. Other research [8, 9] defined climate variability as seasonally or yearly fluctuations above or below the long mean of climatic parameters such as precipitation for a specific region. In our research, dual exposure refers to the combined impact of climate change and climate variability.

4 1064 Sustainable Development, Vol. 2 Table 1: Precipitation, cultivated area, tourism and cruise ship arrival, Barbados ( ). Average Cultivated area (hectare) Tourism arrival (person) Year precipitation (MM) Sugarcane Other crops Long stay Cruise ship The first scenario is named Normal climate representing the climatological normal precipitation in Barbados calculated from 24 years data. As such represents the base line against which to evaluate other changes. The second scenario is Climate Change, where a 50% reduction in the long run average precipitation is modeled. The third scenario is Climate Variability, where 30% variability around the normal average precipitation is introduced to reflect the seasonal or yearly variability in precipitation. Finally, the fourth scenario is the Dual exposure that combines both effects; 50% reduction in long run average and 30% annual variability in precipitation. Water demand for agricultural and urban uses is projected over the 20 years study period ( ). For rainfed crops such as sugarcane, evapotranspiration (ET) is modeled to be a quadratic function of average precipitation. Crops that can be irrigated by drip technology obtain their water from rain with drip irrigation providing supplementary water to achieve

5 Sustainable Development, Vol maximum productivity. Non-agricultural usages are projected to obtain the future water demand by sector under different climatic conditions and economic instruments (e.g. water tariff). Domestic water demand is modeled as a function of population growth and change in household number. For hotels and cruise ships, water demand is a function of the number of tourists arrivals generated stochastically based on long run average data, over 24 years, and constant variance. The consumer surplus is calculated for each climate scenario, subsidy scheme, and groundwater pumping policy, summed over the irrigated crops, irrigation technology, and time periods. The consumer surplus equals half the difference between the maximum (reserve) price and the actual (endogenous) price multiplied by the total quantity produced from each crop summed over irrigation technology. The actual price increases with decreases in water availability for irrigation, which will occur under climate change and drought scenarios. The total economic welfare is taken as the sum of the consumer surplus plus the producer surplus at any given point in time. While the sum of consumer and producer surplus has been recognized as a classic welfare measure, few attempts have been made to integrate its two components into a unified model, especially one that could inform policy debates around the impacts of climate change and climate variability. In the analysis, the trade-off between consumers and producers is investigated by setting the model to maximize the algebraic sum of consumer surplus and farm income. In parallel to this analysis, the urban consumer surplus is examined alongside the water producer surplus generated from the supply side of water. The sum of agricultural economic welfare and urban economic welfare under different climate scenarios and abstraction policy are investigated by examining water allocations that maximize the sum of those four welfare components terms in present value terms. 3 Results and discussion 3.1 Water availability The absolute change in total groundwater storage under different climate scenarios and pumping policies is shown in Figure 1. Several factors affect the aquifer storage volume at a given time; precipitation, population, tourism activities, and land cover type. The factors can work in two different directions, based on their impact on the aquifer. Increased precipitation adds to the storage volume while increased water demand decreases the volume of water held in the groundwater aquifer. Figure 1 illustrates that under the normal climate scenario, a significant incremental decline in groundwater storage occurred with unconstrained groundwater pumping. Under normal climate, no overall change in precipitation is modeled, implying that the impact of precipitation variability can be neglected. In the absence of groundwater pumping constraints, declining groundwater storage volume occurs as a result of factors such as population growth, increased tourism arrivals, which reach 60 MCM in some years.

6 1066 Sustainable Development, Vol MCM Normal_non_constrainedl Climate Variability_Non_Constrainedl Climate Change_Non_Constrained Dual Exposure_Non_Constrained Year Normal_Constrained Climate Variability_Constrained Climate Change_Constrained Dual Exposure_Constrained Figure 1: Annual absolute change in aquifer storage volume by climate scenario and pumping policy, Barbados, (in MCM). By contrast, under the climate variability scenario, the precipitation level is now an active factor and fluctuation in rainfall significantly influences the storage volume. Moreover, the time factor plays an important role, where the prior change in the aquifer storage affects the storage of any subsequent year. Groundwater storage volume will fluctuate from year to year with some years experiencing increases in aquifer storage, while in other years a significant decline in water storage can occur. For instance, up to year 4, small increases in tourism and population are take place, while the climate variability increases the precipitation, increasing the groundwater volume. At year 5, however, the accumulated stored volume is depleted as the climate conditions reverse and there are increases in urban sectors water demand. The storage volume becomes a net water shortage when the decline in precipitation continues for longer period, drought period. The fluctuations associated with the climate variability scenario cause the groundwater storage volume to change between (-49) MCM to (+63) MCM I from the 2015 level. Climate change scenario produces a sharper decline in the groundwater storage. This decline starting from 34 MCM and increases to 651 MCM. In contrast, under dual exposure climate scenario, a small improvement in the water storage occurs. This suggests that there is a positive side to climate variability, wetter periods, alleviate the negative impact of lower precipitation associated with climate change. While it is not shown in this figure, a major change in the land use simultaneously take place. A significant portion of land for sugarcane is taken out of cultivation and became either vacant or grassland, which have higher infiltration rates and leads to improvement in groundwater storage. An option that could be implemented would be to restrict the groundwater abstraction to a specific level. Maintaining the water table level at a certain point would be one way of implementing a water sustainability policy, by constraining

7 Sustainable Development, Vol the water abstraction. Under this policy, a small increase in the aquifer storage level is observed under the normal climate scenario with a slightly higher increase in the storage taking place under the climate variability scenario. Under the climate change scenario, the change in aquifer storage is almost zero. A slight improvement in the storage under dual exposure scenario is observed as a direct result of changes in land use and the positive effect of climate variability. 3.2 Water demand The average water demand over the 20 years by sector, climate scenario, and pumping policy is shown in Table 2. Under the constrained pumping policy, water demand for domestic use falls sharply compared to the unrestricted groundwater abstraction. The decline in domestic water use intensify by pronounced with more severe climate conditions such as climate change and dual exposure. A different pattern is observed in other sectors where under the normal and climate variability scenarios more water consumed by the tourism, cruise ship, commercial, governmental, and corporation sectors by moving from nonrestricted to restricted pumping policy. However, under climate change and dual exposure scenarios, less water will be demanded. The decline in water demand will vary between 55% and 15% for tourism and cruise ships respectively. Even under constrained abstraction, water demand declines with climate change and dual exposure conditions as compared to the normal and climate variability scenarios. Restricting groundwater abstraction gives rise to a reallocation of available water based on the relative scarcity value. As domestic water has the lower tariff compared to other uses, demand will move water toward higher value sectors. However, under severe drought, all sectors will suffer. For the agricultural water demand, reliance on groundwater will increase under the climate change and the dual exposure scenarios. By contrast, constrained pumping has a slight effect on water demand as the price for agricultural water is low. Table 2 shows the average value per cubic meter of water used by sector, climate condition, and pumping policy. Constraining the groundwater abstraction increases the value of water for all climate scenarios with more being charged under the climate change and dual exposure scenarios. In contrast, the water tariff for tourism, cruise ships, commercial, governmental, and corporation sectors moves down under normal and climate variability. Under the climate change and dual exposure scenarios, reduced water availability and constrained groundwater abstraction would raise the water economic value as water become scarcer. 3.3 Food security Another important impact of climate is on food security conditions. Diminished water availability can be expected to adversely affect the availability of food. Declining rainfall could encourage farmers to rely more and more on groundwater to sustain yields through adopting irrigation technologies such as

8 1068 Sustainable Development, Vol. 2 Table 2: Average demand and water value by climate scenario, sector, and groundwater abstraction policy, Barbados. Sector/climate scenario Domestic Tourism Cruise Commercial Government Corporation Agriculture Water demand (1000 CM/Year) Water value (US$/CM) Normal Climate variability Climate change Dual exposure Normal Climate variability Climate change Uncon * Con ** Uncon * Con ** Uncon * Con ** Uncon * Con ** Uncon * Con ** Uncon * Con ** Uncon * Con ** Uncon * : Unconstrained groundwater abstraction; Con ** : Constrained groundwater abstraction. Dual exposure

9 Sustainable Development, Vol drip irrigation. These however would be associated with additional energy costs for pumping. Table 3 shows the average crop prices by climate scenario. Slight increases in food prices occur under the climate variability scenario for all crops, whilst a greater increase in crop prices occurs under the climate change scenario as compared to the normal climate. The significant escalation in food prices happens under the climate change condition as severe decreases in precipitation drive the adaptation of drip irrigation and hence groundwater abstraction, making producing the crops more costly. Under the dual exposure scenario, minor reductions in food prices happen as compared to climate change for all crops except sugarcane. On the other hand, with the increased adoption of drip irrigation more food is produced. Some sugarcane producers would exit with the result that the land would become vacant, causing a sharp decline in sugarcane production. Coupled with the decline in sugarcane productivity due to climate condition, sugarcane prices would tend to increase. Overall, moving from normal climate condition to climate change and variability would increase food prices for all crops. Under the dual exposure situation, it can be observed that the sugarcane price would continue to increase while there could be a small reduction in other crops prices. Table 3: Average crops prices by climate scenario in, Barbados (1000 $ US, Ave. 20 year). Crop Normal Climate Climate Dual variability change exposure Sugarcane Cucumber Cassava Onion Pumpkin Squash Cabbage Tomato Okra Sweet Pepper Sweet Potato Pigeon Peas Economic welfare Table 4 summarizes the changes in discounted annual agricultural economic welfare in farm income and consumer surplus over all crops. From the results, climate change and variability work in the interest of food producers. The discounted annual farm income increases as it goes from normal climate conditions to climate variability condition and continue to increase under climate change and dual exposure scenarios. Food producers achieve the highest discounted farm income under dual exposure. Under climate variability and climate change conditions, declines sharply causing shortages in

10 1070 Sustainable Development, Vol. 2 Table 4: Discounted agricultural income and consumer surplus by climate scenario, Barbados (Million US $). Year Normal Discounted farm income Climate Climate variability change Dual exposure Discounted agricultural consumer surplus Climate Climate Dual Normal variability change exposure food supply that drive food price increases. Food prices increase for all crops, though there is a small decline in food prices under dual exposure scenario compared to climate change and variability. Despite the reduction in some crops prices under dual exposure, farmers would receive the highest farm income under that climate scenario; achieved due to improvements in crops yield supplied by increased water availability in wet years. Consumers would experience some increases in food prices as a result of climate alteration. Moving from normal climate condition to climate variability, the annual consumer surplus increases in years with higher rainfall and declines in low rainfall years. Food supply increases in wet years because of improved yields form rainfed crops, while food prices for drip irrigated crops decline due to lower cost associated with pumping. However, under climate change scenario an overall decline in consumer surplus would occur because of yield reduction. The decline in consumer surplus continues under dual exposure climate as variability in precipitation pushes some farmers to exit production, resulting in a sharp decline in food supply. Overall, the consequences of climate change and variability would be distributed unevenly across producers and consumers. In the agricultural sector,

11 Sustainable Development, Vol farmers could gain some benefits from climate alteration; consumers however would incur additional costs. Furthermore, the impact of climate change and variability would differ among farmers, while climate change provides an opportunity for vegetable cultivators to respond positively through the adoption of drip irrigation, rainfed farmers would experience negative consequences. That is, farmers' vulnerability plays an important part in how of the economic costs of climate alterations are distributed. Farmers with a lower ability to adopt new irrigation technology, such as sugarcane cultivators, would be net loser from climate change and variability, while cultivators of vegetable and root crops could gain extra benefits from that climate shift. For the non-agricultural sectors, consumers would experience the consequences of climate change and variability. Similarly, the water service provider could reduce operational and maintaining losses by constraining water supply through higher water tariff. Under that situation, water would be reallocated to higher value users who could afford the higher tariffs, while more vulnerable users would experience the negative consequence of climate change alteration and abstraction constraints. 4 Concluding remarks Climate change and variability have important physical and economic implications and it is important to differentiate between climate change, climate variability, and dual exposure. Their impacts on water availability, food security, and economic welfare are expected to be unevenly distributed across different economic sectors. Growing population and urbanization, food security concerns, and economic development pose challenges for the management of limited water resources. Little attention has been paid to investigating the impacts of both climate change and variability on water resources, food security, and social welfare. This research addresses that gap in knowledge through the development of a framework that integrates climatology, groundwater, economics, agronomy, and institutional policies. This framework has been developed and applied to Barbados as a proof of concept case study. The findings illustrate that when the average long run precipitation declines, a severe decrease in groundwater storage occurs due in part to increase pumping required to meet agricultural and non-agricultural water uses. In contrast, climate variability could mitigate some of the decline in groundwater storage volume, assuming that aquifer recharge increases in wet years. Constraining groundwater abstraction to conserve aquifer storage to current levels would result in decreasing average per unit water use. Food would become more expensive as production would decline due to increasing water scarcity. On the other hand, the consequences of water scarcity would be distributed unevenly among agricultural producers and consumers, with consumers bearing the major economic burden. That said it could present some agricultural producers with economic opportunities. The adaptability of agricultural producers would depend on crop vulnerability to climate changes and farmers ability to adopt new technology. Only those farmers who could adopt new technology such as drip

12 1072 Sustainable Development, Vol. 2 irrigation could survive under the climate conditions, while others such as sugarcane would move out the production. In the case of non-agricultural water sectors, a sharp decline in per unit water availability would occur under the climate condition resulting in diminishing consumer economic welfare. Incremental increases in water tariff could be expected under the changed climate conditions. Under constrained abstraction, water would become scarcer. It would also imply that domestic users would bear the consequences of climate changes on water availability. This research suggests a way for water policy implications and alternative adaptation measures to be explored. References [1] Bakker, Alexander, Janette Bessembinder, Allard Wit, Bart Hurk, and Steven Hoek. Exploring the Efficiency of Bias Corrections of Regional Climate Model Output for the Assessment of Future Crop Yields in Europe. Regional Environmental Change 14, no. 3 (2014): [2] Cooper, P. J. M., J. Dimes, K. P. C. Rao, B. Shapiro, B. Shiferaw, and S. Twomlow. Coping Better with Current Climatic Variability in the Rain-Fed Farming Systems of Sub-Saharan Africa: An Essential First Step in Adapting to Future Climate Change? Agriculture, Ecosystems & Environment 126, no. 1/2 (2008): [3] Cashman, Adrian, Leonard Nurse, and Charlery John. Climate Change in the Caribbean: The Water Management Implications. Journal of Environment & Development 19, no. 1 (Mar 2010): [4] Thomas-Hope, Elizabeth, and Adonna Jardine-Comrie. Valuation of Environmental Resources for Tourism in Small Island Developing States - Implications for Planning in Jamaica. International Development Planning Review 29, no. 1 ( ): [5] Shrivastava, G. S. Water Resources and Food Security: A Caribbean Case Study. Proceedings of the Institution of Civil Engineers-Water and Maritime Engineering 156, no. 4 (Dec 2003): [6] Trotman, Adrian, Ronald M. Gordon, Sharon D. Hutchinson, Ranjit Singh, and Donna McRae-Smith. Policy Responses to Gec Impacts on Food Availability and Affordability in the Caribbean Community. Environmental Science & Policy 12, no. 4 (Jun 2009): [7] Katz, R. W., and B. G. Brown. Extreme Events in a Changing Climate - Variability Is More Important Than Averages. Climatic Change 21, no. 3 (Jul 1992): [8] Bugmann, H., and C. Pfister. Impacts of Interannual Climate Variability on Past and Future Forest Composition. Regional Environmental Change 1, no. 3-4 (Dec 2000): [9] Hulme, M., E. M. Barrow, N. W. Arnell, P. A. Harrison, T. C. Johns, and T. E. Downing. Relative Impacts of Human-Induced Climate Change and Natural Climate Variability. Nature 397, no (Feb ):