Making  investment in water infrastructure bankable

Water forms the foundation of all natural systems. Its unique physical properties make it irreplaceable for energy transfer and ecosystem regulation—earning it the designation as “the bloodstream of the biosphere.” Beyond its ecological role, water is essential for human health and economic prosperity.

To secure reliable access to this vital resource, humanity has developed infrastructure with three core functions: storage, transport, and treatment. Water infrastructure is characteristically capital-intensive and long-lived, with high upfront costs that cannot be easily recovered if projects fail. In Europe, the Water Framework Directive 2000/60/EC makes a distinction between services and uses.

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Water resilience: need for a new management paradigm?

In the political guidelines for the next European Commission 2024-25 released on 18 July 2024 (link), Mrs. Von der Leyen emphasized the importance of water. She stated that the upcoming European Climate Adaptation Plan must support a Water Resilience Strategy to ensure pollution sources are properly managed and scarcity is addressed. This strategy aims to enhance the competitive innovative edge of its water industry and adopt a circular economy approach. As part of this, Europe will lead efforts to mitigate and prevent acute water stress globally.

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Rethinking infrastructure for the future

The Paris Agreement and the 2030 Agenda for Sustainable Development were both adopted in 2015. As illustrated by the Connect4Climate infographic, the implementation timing of the instruments is closely related and there are a lot of synergies between nationally determined contributions to achieve carbon neutrality in 2050 under the Paris Agreement and 17 UN Sustainable Development Goals to be reached by 2030.

Infrastructure plays a key role in supporting the achievement of the SDGs and the Paris Agreement since it delivers essential services including energy, water, communications, healthcare and education. At the same time, infrastructure is also part of the problem since it a major source of GHG emissions and will be responsible for the biggest part of adaptation cost as illustrated in the table below (source: UNOPS 2021 report “infrastructure for climate action”)

Infrastructure and climate change
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