David Corderi Novoa Department of Agricultural & Resource Economics University of California Davis, United States

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1 David Corderi Novoa Department of Agricultural & Resource Economics University of California Davis, United States In collaboration with: Jeffrey Williams 1, Jay R. Lund 1, Richard E. Howitt 1 and Do Duc Dung 2 1 University of California Davis United States 2 Dong Nai River Basin Planning Commission, Southern Institute for Water Resources Planning (SIWRP) - Vietnam

2 Motivation Studies of adaptation in different scales of analysis such as economy/sector-wide but not at the River Basin Level. Studies at river basin level do not fully incorporate economic analysis for decision making (more details on biophysical aspects) 2

3 Previous Studies 3

4 Expected Impacts Economic analysis to inform decision making at river basin level. Incorporating Autonomous (water user) and Planned Adaptation (government) at the River Basin Level Focus on Hydrological Extremes (Dry Season and Wet Season Changes) Economics of Uncertainty (risk based CBA, real option analysis) Timing and Sequencing (beyond static scenarios) of Adaptation 4

5 Project Design Climate Change Projections Rainfall/Runoff + Hydrodynamic Model Projections Identify Climate Change Impacts Adaptation Dry Season: Salinity Changes (focus on agriculture) Adaptation Wet Season: Flooding Changes (urban and rural areas) Identified Adaptation Options Economic Model Water Infrastructure and Agriculture Production Crop Cost & Return Studies Agronomic Salinity-yield Field Exper. Agriculture Land Use Plans Economic Model Risk-Based Optimization (Flood Infrastructure Investments RISK Probability Consequences Water Infrastructure Plans (Cost & Benefits) Moser 1997 Jonkman et al

6 Study Area: Lower Dong Nai Delta The Map of Vietnam Ha Noi Dong Nai RB Mekong Delta Ho Chi Minh City 6

7 Dong Nai Basin Facts Characteristics: - Population: 18 million (20%) - Area: 55,439 km2 (17%) - GDP~48% of National GDP* * 28% Agriculture/ 63% Industry/41% Services - River Basin Organization (DNRBO, created in 2001) Previous studies: Economic model for water allocation (Ringler 2004) Irrigation, flood control assessments, water resources planning. 7

8 Current Dry Season-Salinity 8

9 Current Areas Experiencing Flooding Middle Dong Nai river Lower Da Nhim reservoir Can Do n Re se r. DA K'LAK DA K N ON G Su oi Vang Reser. DA LA T LAC DUONG TA N BIE N PH UO C BIN H LOC NINH BINH LONG Loc Qu an g R ese r. Pu M ien g R ese r. An Kh uon g Res er. Ph uo c H oa Res er. Don g Xo ai R ese r. DON G XOA I Su oi Cam Reser. Thac Mo Reser. BU DANG CA T TIEN DA TEH Da Te 'h Reser. Don g N ai 4 Re ser. Don g N ai 3 Re ser. BAO LAM Ta n R ai Re se r. BAO LOC DI LINH Ka L a R ese r. LAM H A Dai N inh Res er. Tuyen Lam Res er. Don Du ong Re ser. So ng Sat Re ser. DON DUONG LIEN K H UO Pr o Res NGer. NINH SON Tan My R ese r. Ta n G ian g R ese r. NINH HAI THAP CHAM NI NH P HU OC Lan h Ra R ese r. CHAU THANHDUONG MINH CHAU TA Y N IN H Tr i An Res er. Can No m R ese r. GO D AU H A TR AN G BAN G CU C H I DUC HOA Lower Dong Nai- Sai Gon rivers BEN CAT Su oi Gia i Res er. TAN UYEN VINH CUU BIEN HOA Song THMay ONReser. G NH AT TH U AN A N La Buo ng Res er. HOC MON HO CHI MINH CITY LONG THANH PH UO C LY CA N GIO Suoi Ca Reser. Da Va ng Re ser. VU NG TAU XU AN LO C CHAU DUC Da D en Res er. Tam Bo Reser. Da Bang Reser. DINH QUAN So ng Von g Res er. BA R IA LONG DAT Don g N ai 8 Re ser. GIA RA I So ng Ra y Re ser. Suoi Giau Reser. DA HOAI Da Ton Re ser. TAN PHU Nui L e Rese r. DUC LINH Tra Tan Rese r. Gia Ui Re ser. Du C on g Ho i Re ser. XUYEN MOC Ba T o Rese r. Bin h Cha u R ese r. Bie n La c La ke TANH LINH So ng Din h 3 Re ser. So ng Pha n Res er. HA M TA N Da M i R ese r. Ham T hu an Re ser. Ka Be t Re ser. So ng M on g R ese r. Ba Bau Reser. HA M TH U AN N AM Ta n lap Reser. Nui D at Rese r. So ng Q uao Re ser. Suoi Da Reser. HA M THUAN BA C PHAN THIET So ng L uy R ese r. Ca G iay Res er. Ba u Tr an g la ke BAC BINH Lon g Song Re ser. Da Ba c R ese r. TUY PHONG Lower La Nga river 9

10 Progress so far 10

11 Land Value (million VND) Cropping Patterns (ha.) Climate Change Impact & Adaptation Assessment Investment Timing and NPV 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10, Salinity Concentration (g/l) Region 1 Region 6 Region 5 Region 7 Region 8 12,000 10,000 8,000 6,000 4,000 2, Salinity Concentration (g/l) W-S Rice S-A Rice Sugarcane Vegetables 11

12 Identified Adaptation Options Constructing Sluice Gates Changing Cropping Patterns Constructing/Upgrading Dykes Changing Upstream Reservoir Operation Can Don SRFu Mieng Be River Thac Mo Dong Nai River Dai Ninh Da Nhim Dau Tieng Ham Thuan East Vam Co River Sai Gon River Tri An La Nga River West Vam Co River Dong Nai River 12

13 Main Questions How the Dong Nai Basin Can Adapt Economically to changes in the Dry Season?: Tradeoffs between changing cropping patterns, changing reservoir operations and the timing of irreversible" infrastructure investments to maintain agricultural productivity. Sea level rise, trade-offs between protecting downstream coastal areas versus upstream. How to re-design flood protection infrastructure in a context of changes in flood frequency and increasing urbanization and value at risk (what areas to protect?, when?) 13

14 Project Challenges Data availability and data quality (weather stations, gauge stations) Uncertainties at all levels (simplification) Integrating different temporal, spatial scales, units of analysis (RB, admin units) Wilby and Dessay 2010 Lund et al Collaboration among experts of different backgrounds 14

15 Lessons Learnt Despite data limitations, results from analysis can be useful for river basin planning. Changes in hydrologic extremes have more implications than changes in average hydrology when planning for adaptation. Economic analysis can be useful for decision making at the river basin level: Analyze tradeoffs inherent to investment planning. Suitable to analyze uncertainty, timing and sequencing of adaptation It is not the only approach (MCA, etc.) Collaboration between multi-disciplinary teams (economists, hydrologists, engineers, ) builds capacity (integrative approaches and common understanding) Transboundary coordination is also important for RB planning. 15

16 Thank You & Discussion More from: David Corderi et al.: The Economics of Climate Change in River Deltas: Adapting to Increased Salinity. forthcoming in Proceedings of the 17 th ISDRC Conference, Moving Towards a Sustainable Future: Opportunities and Challenges. May 8-10, 2011, New York, United States. The Economics of Climate Change, Urbanization and Long Term Flood Protection in the Lower Dong Nai Delta. forthcoming in Proceedings of the KLIMA 2011 Conference, Climate Change and Disaster Risk Management. November 7-12, 2011, Bonn, Germany. 16

17 Extras 17

18 Planned Sluice Gates 18

19 Planned Dykes 19

20 Cropping Calendar and Crop Water Demand Crop Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total (m3/ha) Winter-Spring Rice Summer Autumn Rice Seasonla rice (single rice) Winter-spring upland crop (Maize, soybean, bean, ) Summer-autumn upland crop (Maize, soybean, bean, ) Seasonal upland crop (Maize, soybean, bean, ) Winter spring vegetable Summer- autumn vegetable Seasonal vegetable Sugarcane Coffee/Peper Fruits

21 Salinity Dynamics Seasonal Salinity Salinity projections 21

22 Alternative Flood Control Strategies Source: PPIC (2011) 22