This chapter focuses on policy coherence and sustainable management of the WELF nexus in Korea. This chapter provides a rationale for improved planning against future water-related risks, and the benefits of independent regulation and other supporting policy instruments (such as permitting, compliance monitoring and enforcement, and environmental impact assessments) to support the sustainable management of the WELF nexus. Good practices in integrated water resource planning, including resilience thinking and scenario planning, and options for delivering independent water regulation are provided.
Managing the Water-Energy-Land-Food Nexus in Korea
Policies and Governance Options
OECD Studies on Water
Chapter 3. Towards policy coherence and sustainable management of the Water-Energy-Land-Food nexus in Korea
Abstract
3.1. Planning as a key instrument to manage the WELF nexus in Korea
3.1.1. How planning combines with regulation and permitting
The basic principles of water management and regulation are summarised in Figure 3.1 below. At the centre of effective regulation are the standards and targets to protect and improve the water (and land) environment, so that it can continue to provide the services on which society depends. The decision on what type of regulatory measures to use will determine whether it should be a conventional permitting approach, an alternative (the right-hand side of the flow chart), or some hybrid. It is essential that as part of the regulatory process, monitoring and reviews are carried out to determine whether the desired outcomes are being achieved. There must then be a policy and knowledge feedback loop to amend (or endorse) the approach to regulation, or potentially to change the standards.
Figure 3.1. The regulatory cycle for sustainable water management
Source: Professor Ian Barker, Water Policy International, Pers comm.
There are four key elements to water management and regulation:
1. Developing plans to deal with current identified problems of water pollution (e.g. eutrophication), low river flows (scarcity, droughts) and urban flooding.
2. Setting regulations (i.e. policy guidance) for the routine management through permitting of water resources and control of pollution, and the financial charging, compliance monitoring and enforcement of those permits. Also, regulations for land use development control and agricultural policy are required so that water and land use management are fully integrated.
3. Specifying actions during periods of drought and floods in order to manage diminishing resources, conflicting demands, environmental stress, and flood risk both before and during events.
4. Considering future pressures and uncertainties, and what action might be needed to manage the impacts of climate change and increasing development pressures on water and land.
This process is essentially the one followed throughout Europe via the implementation of the Water Framework Directive (see Annex 3.A), which uses costed options appraisal to determine the measures to restore and protect the water environment for the benefit of ecosystems and people.
The four areas listed above all require sound data about the current state of the water environment (quality, resources, hydroecology) and trends over time: how is the water environment changing in response to human pressures and changes in land use? The four work areas should be part of a feedback loop so that where it is clear that more data is required to make sound decisions, those needs are fed back into the monitoring programme. Specific terrestrial sites or water bodies of concern would be subject to detailed investigation as necessary. During periods of drought, additional hydrological and ecological monitoring should be in place to aid the day-to-day management of the drought, planning for the next actions, and to act as a database for future drought management planning so that lessons are learnt (see section 3.1.4). Similarly, every flood event is an opportunity to learn and take action to minimise future risk.
The challenge in Korea is to ensure an integrated approach to planning, regulation and management, with a clear shared and common view on the desired outcomes and success measures. The following points to consider would involve all relevant actors:
Review the transferability of the EU Water Framework Directive approach and process, and consider which elements might benefit water management in Korea.
Consider the objectives of the regulatory process in meeting the desired outcomes which emerge from the plans. Be clear about how each permit issued in each water body, including for land development control is contributing to those outcomes, and ensure that all involved in water and land management operate as an integrated whole.
Ensure that the permitting systems are flexible and dynamic to be able to cope with, and account for, improved understanding and environmental change.
Monitoring and managing water is expensive, and where water users do not pay a charge they will not value the resource. Consider introducing meaningful charges for abstractions and discharges, as well as for applications for permits, in order to work towards full cost recovery.
The following sections look at how Korea can increase resilience to future water risks through water resource planning, integrated basin planning, and scenario planning and risk management.
3.1.2. Water resource planning for secure water supplies
This section covers the key steps required for water resource planning, including the need for a long-term and holistic view, levels of service and systems resilience, forecasting demand, and options to reduce the supply-demand deficit.
Coordinating water policies
Plans to secure water supplies for people and businesses often focus solely on assessing the resources required to meet demand. However, water demand is not a given: it can be influenced and managed (see Section 2.2).
The challenge in Korea is the lack of inclusive and transparent stakeholder engagement to be able to coordinate and consider viewpoints of various stakeholders in developing a water resources plan. The ME, with other key ministries such as MAFRA, MoLIT, specialised government agencies like KECO and K-water, provinces and municipalities would all need to contribute to a national plan which, as far as possible, aimed to optimise the use of available resources across the country irrespective of hydrological or administrative boundaries. The more that a plan is fragmented, the greater the risk that the solutions to supply challenges will be more expensive, less resilient and less sustainable.
The need for a long-term and holistic view
The intergenerational nature of most water supply investment means that it is essential for planning to take a long-term perspective. A typical minimum planning horizon in water resources is 25 years, but that should not prevent a longer term view where this is appropriate. Given the long lifespan of water infrastructure, it is important that water resources management plans are resilient to a range of potential climate scenarios and are designed with climate risks built in. In addition, in Korea the introduction of environmental flows by ME could introduce uncertainty around the sustainability of existing reservoirs and abstraction licences, which means that the potential reduction in source yield needs to be taken into account.
It is essential to consider how other parts of the nexus can help, or undermine, careful water planning. This is particularly important in Korea, where agricultural water demand and the complex web of dams, reservoirs and weirs need to be optimised across all sectors. The Smart Water Initiative (see OECD, 2017a) is helping to address this need. However, the impact of food and energy policy and land use planning on water availability, demand and quality should be factored in. Planning decisions need to take account of all stakeholder interests, and be in the context of long-term integrated basin management.
Levels of service and systems resilience
A water resources plan should comply with government policy on the sustainable use and management of water, and its efficient use. They should reflect "acceptable levels" of water security (OECD, 2013).
A rigorous options appraisal might be to carry out a probability analysis of drought events not seen in the historic record. This probabilistic approach has been used for London (Borgomeo, 2014) where the potential impacts on levels of service of a non-stationary climate have been modelled, and also an assessment of supply security against a wide range of uncertainties (Borgomeo, 2018). A useful test is to look at the experiences of other nations with unprecedented drought events and to ask ‘What would happen if an equivalent drought happened in Korea?’
The appraisal of risk management options (either through demand management or supply augmentation) should consider the costs and benefits of each, recognising that often the benefits might be difficult to monetise. For example, being able to leave more water in a river because of demand management will have a value to other abstractors and to ecosystems. Using different scenarios for demand and supply allows the system to be tested by looking at periods of high demand and low supplies, and uncertainties in planning assumptions, which can be tested against a baseline position to forecast what would happen if no new supply or demand actions were taken.
If, after having been through this baseline exercise it is apparent that there is a supply-demand imbalance, there then needs to be an appraisal of options to manage demand, set alongside options to develop new resources or increase treatment capacity. The options need to be tested against challenging but plausible droughts to understand potential weaknesses to different types of drought, as well as other pressures such as pollution, and against different levels of service, so that it is clear what action needs to be taken at each stage of a developing drought.
Forecasting demand
Understanding the drivers of demand for water, and then translating these into the basis of forecasts, is one of the most challenging elements of any water resource plan.
Forecasts for future water demands from households, energy, agriculture, industry and the environment should be included. Changes in energy policy, for example progressively abandoning coal-fired generation in favour of wind and solar sources (as is the case in Korea), will impact on water availability by reducing water demand for cooling. Industrial and agricultural water demand can be very difficult to forecast, so a scenario approach will help to expose potential risks. Changes in land use, such as afforestation or deforestation, will not only affect overall demand for water in a basin in a way which is difficult to control, but also the runoff characteristics and potentially also water quality.
A further, important consideration is to ensure that there is sufficient water for the environment in the future. In Korea, this is complicated by the potential temperature increases and flow changes as a result of climate change. Such changes are likely to modify ecosystems. This uncertainty needs to be factored into water resources planning and appropriate allocation of water for environmental flows.
All these variables in the forecasts will have a different influence on the location, magnitude and timing of total demand for water. The impact of policy and regulation is critical, particularly for the promotion of measures and behaviours to support water conservation.
Options to reduce the supply-demand deficit
A robust plan will build in headroom to allow for the uncertainties in demand (and supply), and will allow for risk to increase into the future. Over time, the uncertainties will reduce and it will be possible to adapt to changes. Once a series of demand forecasts has been generated it is possible to see whether there is a deficit at any point over the planning period, taking account of the likely impacts of climate change and other pressures on source yields. Where deficits are likely, or headroom is reduced resulting in increased risk of failure, the plan then needs to identify potential options to close the gap. The aim should be to have a balanced portfolio of options so that the risks are spread, rather than relying solely on one type of option (e.g. supply augmentation). Where there are concerns about the level of confidence in the demand forecasts, a series of incremental developments can ensure a low-regrets approach to investment which can be adjusted as more certainty is available.
A water resources plan should provide a stable basis for decisions, but given the uncertainties about the future it is important to understand the factors which could have the biggest influence on it. Scenario testing can help to show how resilient the plan is to a range of risks, and the timing of critical changes. It can show when the approach needs to be flexible or fixed, and when important decisions need to be made. It can also identify what should be monitored to manage risk, and suggest how the plan may need to change in the future in response to new evidence.
In summary, points to consider for water resource planning include:
Set levels of service for water supply security, now and in the future. These may be different for different sectors: public supply, energy, industry, agriculture (and within the agriculture sector, they will depend on the types of crops grown), environment
Take a long term view – at least 25 years – and assess the impact of different climate change and demand scenarios on water availability and demand, for all sectors
Assess a full suite of options, on both the supply and the demand side, for their risk, cost, sustainability and flexibility in the face of uncertainty.
3.1.3. Integrated basin planning
The value of integrated basin planning and management
The current silo approach to water planning and management in Korea, where water resources, water quality, agriculture and development planning are dealt with separately, is failing to benefit from the synergies and opportunities for multiple benefits which an integrated approach would bring. The benefits of integrated basin planning and management can be summarised as follows:
The full breadth of the evidence base can be aggregated so that a complete picture is presented of the state of the environment in the basin, together with current and future pressures and how these interact on society and the economy. Where there is uncertainty this can be identified and the consequences of a precautionary approach explored.
An integrated plan will set the ambition for the basin. This might include: the restoration of the environment to a target state or prevent its further deterioration; to secure more productive agriculture; or to reduce flood risk; or to increase water supply resilience. The important point is that all of these apparently separate ambitions can be viewed together. The outcome from this appraisal may be to use one action – which might be a policy change or an infrastructure development – to deliver wider benefits than just its core purpose.
An integrated plan provides the basis for understanding the total financial spend requirements, and the relative priorities of different objectives. It can therefore help to shape the type, and to set the level of, charges based on polluter or user pays as appropriate. At present, spending in each river basin in Korea is largely sectoral or silo driven by the various separate interests.
The actions within the plan should include the basis for environmental permitting of activities which would otherwise have a detrimental effect. Because the plan has set clear objectives for the basin, these will translate into conditions and restrictions on permits to control abstraction and polluting activities within sustainable limits and reflecting local circumstances. Businesses can then make informed choices about where to locate, using the knowledge of the potential costs at any location.
Finally, the process of developing and agreeing the plan should be open, inclusive and transparent. All stakeholders should have a voice, and the costs and sharing of actions agreed. Inevitably, this process will result in trade-offs, but these will be understood and arrived at through a negotiated process (see 0).
Integrated basin planning in Korea
The number of national, regional and local actors (OECD, 2017a), each with their own remit, results in the lack of a comprehensive and integrated plan for each major basin. A further omission is that tributaries and small catchments have little monitoring and few controls. Experience from Europe (Annex 3.A) is that the adoption of integrated land and water management plans under the Water Framework Directive helped to identify synergies and multiple benefits from actions to protect and improve the water environment.
Steps to consider for improved river basin planning and management in Korea include:
Review the potential to adapt and apply the principles of the European Water Framework Directive for integrated water and land planning
Address the need for a single ‘Competent Authority’ to own and oversee the planning process and the delivery of actions, both by itself and others, and consider how this approach might work in Korea
Review monitoring, regulation, permitting, inspection, charging and planning processes in the context of a Water Framework Directive type of approach.
Chapter 4 provides a review of, and recommendations for, water governance and institutions in Korea.
3.1.4. Future-proofing the WELF nexus and planning for uncertainty in Korea
It is unclear from the different climate and hydrological models how water stress in Korea might be affected by climate change, and how the monsoon might behave. Increased precipitation, including from extreme events, seems likely to increase, with consequent implications for the frequency and magnitude of fluvial and pluvial flooding (UK Met Office, 2011). Recent droughts around the world are timely signals that past weather patterns are no guide to the future, and that systems resilience is likely to be tested more harshly. Despite all the uncertainties, there are techniques using scenario planning and resilience modelling which can help in planning for secure supplies and a healthy environment.
This section describes how Korea can anticipate and manage droughts and floods, and use scenarios to test long-term policy options.
Anticipating and managing drought
Although the approach to water supply planning described above takes account of severe drought events, there is always the possibility that a drought of even greater severity could occur. In such unforeseen circumstances, extra measures would be required to respond to an extreme drought. It is prudent therefore to have in place a drought management plan which can be implemented progressively as a drought develops, on a no regrets basis.
Drought can happen anywhere, even in countries perceived as not water stressed. The frequency of drought events can test supply systems and challenge assumptions about their reliability. For example, in northern and western Europe, severe droughts in 2002-03, 2005-07 and 2011-12 all broke meteorological records in some way, and have led to a re-think about drought planning and supply resilience.
In Korea, the recent period of five years with dry springs could be an indication of the potential for more frequent dry spells which would further jeopardise the reliability of reservoir supply systems. The Korea Meteorological Administration forecasts an increase in drought frequency, which will test any inefficiencies in water management and the assumption that droughts are manageable. A prudent approach to planning would be to assess the impact, for example, of two, three and four years in succession with significantly below average rainfall, and what this would mean for reservoir storage and the ability to maintain supplies.
Drought management
Drought impacts are cross-cutting on government departments, regulators, water-using sectors and wider society. It is therefore essential that drought planning and management are integrated across all affected parties, with clarity of roles and accountability. The policy objectives and institutional arrangements should be established as part of the drought planning process, so that where drought management involves trade-offs and compromises, these have been debated and agreed in advance of a drought occurring. Mitigation measures should form part of these conversations. Robust drought risk management will aim to deliver multiple outcomes for people, freshwater ecosystems and the economy within the context of a drought resilient society. This aim is likely to be made more difficult where a society does not value water, or make the link between the water used in cities and ecosystems in the rural areas. When water efficiency is not a priority – as is the case in Korea - effective drought management is compromised because water users are not sensitised to the need to use resources carefully.
The potential actions to secure supplies and protect the environment would ideally have been previously subject to an impact assessment as part of the drought planning process so that the least damaging and best value options can be adopted first. As a drought progresses, the more extreme and expensive options would then be implemented. Early warning systems can be valuable in helping water managers and water users plan ahead. All actions should be associated with triggers such as critical river flows, reservoir stocks, groundwater levels or water demand (e.g. for irrigation). The critical point is that drought management should be part of a planned, proactive process, rather than a reactive one developed during the drought itself.
Korea is potentially vulnerable to droughts (and other shocks), because of the level of water scarcity and nature of the supply systems for drinking water and agriculture. Its rigorous, but reactive approach to disaster management contrasts with the lack of pro-active planning and mitigation measures. Recommendations to Korea to improve drought management include:
For each river basin and drinking water supply area develop plans to set out pre-agreed actions, including compromises and trade-offs, for droughts of different severity and duration
Carry out Environmental Impact Assessments in order to understand, and be able to mitigate, the impact of planned emergency measures
Set out pre-agreed triggers for action as a drought progresses, under a range of different scenarios
Establish communications plans, for participation of key stakeholders as well as the wider public.
Flood risk management
Korea’s flood risk index is higher than other countries (OECD, 2017a), at 6.85 casualties per million people exposed, and in recent years there has been significant financial impact and numbers of people affected. Average annual precipitation in 2001-2010 increased by 7.4% compared with the 30 year period to 2010, and flood risk is forecast (Park et al., 2016) to continue to rise, in particular from 2025 to the 2050’s. Government ministries are working together to address the risks and to develop comprehensive measures to prevent urban flooding. These include better provision of information and improved flood forecasting and warnings, more use of rainfall radar, and an ambition to increase the capacity of the drainage networks and fully separate foul sewerage where necessary. There is also recognition of the need to promote low impact development and to better manage rainfall runoff in the urban environment, as evidenced by the large number of pilot projects in Korean cities. The challenge is to accelerate progress and innovation on stormwater management; green infrastructure pilots and increases in urban floodwater storage show what can be done, but so far only at a small scale. Box 3.1 presents a case study demonstrating how green infrastructure can be harnessed to manage urban flood risks in New York City, USA.
Box 3.1. Urban Flood Risk Management – Blue-Green Cities Case Study, New York City
Blue-Green Cities help to address modern challenges to quality of life, climate change and inequality. With nearly 70% of the world’s population set to live in cities by 2030, keeping up with global urban growth projections for 2030 will mean developing an area the equivalent of 20,000 American Football fields every day up to 2030. Vulnerable water resources and ecosystems will be subjected to the pressures from this growth and urbanisation.
More cities around the world are adopting blue and green infrastructure through retrofit programmes, which use trees, soils and other planting to manage urban water by mimicking the natural hydrological cycle. New York City is aiming to invest US$2.4bn in green infrastructure over the next 20 years. It is planning over 7,000 “kerbside gardens” in the streets to reduce the risk from combined sewer overflows. In Wales, Welsh Water are investing £80 million up to 2020 in their RainScape program, which aims to minimise surface water ingress into the combined sewerage network.
Done well, green infrastructure reduces flooding, improves water quality and replenishes groundwater. The protection of water resources from urban runoff and associated pollutants like sediment, nutrients, metals, pathogens, trash, and hydrocarbons is a constantly growing challenge. It also brings multi-faceted benefits such as beautifying neighbourhoods, increasing property values, reducing the heat island effect and absorbing carbon dioxide.
In an urban context where space is at a premium, blue-green infrastructure is an important integrated design strategy for architects, planners and engineers to consider. For example, in Red Hook Houses in Brooklyn, New York, elevated landscape berms between apartment buildings act to protect the residential buildings from flooding while providing safe and regenerated courtyards for the residents to enjoy. The waterfront park at Hunters Point South in New York City (below) is designed with a significant amount of the park area that is designated to flood intentionally during heavy rainfall events. The challenge until recently was gaining consensus, developing guidelines and finding success in pilot projects; the challenge now for cities is delivering at a scale and pace that protects waterways and combats climate change.
Hunters Point South, New York, under normal conditions (top) and flood conditions (bottom)
Source: Dr. Mark Fletcher, Arup, Pers. Comm. Photo credit: Thomas Balsley Associates.
Korea’s rapid urbanisation has led to the area of urbanised and paved areas doubling between 1989 and 2009 (OECD, 2017b). Over the same period the area of grasslands decreased by 24% and wetlands by 61%. At both a basin and a local scale, these changes potentially increase flood risk. Land use controls at a basin level appear ineffectual in terms of incorporating flood risk assessment into new developments. Any assessments are carried out at a municipal or regional scale, rather than considering wider (downstream) basin impacts. New factories and other developments are often constructed in flood risk areas, compounding runoff problems rather than seeking a runoff-neutral or positive impact.
Although the techniques and principles of sustainable drainage, such as swales, permeable pavements and green roofs are well understood in Korea, the challenge is in creating the mechanisms for them to be implemented at scale. It requires politicians, developers, architects, planners, engineers and municipal authorities all to be aligned to ensuring not only that new developments are low impact but that there is also a plan to progressively implement such water sensitive schemes in existing towns and cities. It also requires sufficient funds for investment, the governance to ensure that they are constructed to the necessary specification, and ongoing maintenance funding so that they continue to perform as designed. The government has plans to improve rainwater retention and install runoff reduction measures in the 107 areas of greatest risk, and is aiming for a more proactive approach to both pluvial and fluvial flood risk management.
The following are recommendations for Korea to consider in the management of flood risk:
1. Review potential barriers to scaling up LID and green infrastructure, and develop a funded strategy for reducing urban flood risk, taking account of the increased risk from climate change.
2. Design green infrastructure so that it reduces urban diffuse pollution as well as runoff.
3. Establish a campaign for greater public awareness of flood risk, and the need for pollution management.
4. Ensure that land use and development controls consider flood risk at a basin scale, rather than regionally or at a municipal level, so that future land use changes of all types minimise runoff (and do not enhance it).
5. Use integrated river basin planning and management to integrate small and large scale green infrastructure initiatives, and seek to obtain multiple benefits (e.g. water quality, low flow support, flood risk reduction, amenity and recreation).
Resilience thinking
There are a range of threats other than droughts and floods which can lead to failure but which are not routinely considered in planning or operational thinking. The task for water managers is to design and operate systems to overcome them rather than seeking the impossibility of avoiding failure altogether.
This requires a paradigm shift and a holistic approach to addressing water problems. Water systems are designed and operated to deliver to a standard of service; safe drinking water, or clean effluent or reliable supplies. The reliability with which the system does this is the degree to which it minimises level of service failure over its design life when subject to planned loads. Its resilience is the degree to which it minimises level of service failure magnitude and duration when subject to exceptional conditions and threats. The threat can come from anywhere. It might be something which occurs gradually, such as progressive urban expansion (an external threat) or progressive loss of skills, or steady reduction in funding (internal threats), or something which happens quickly such as a natural disaster, cyber-attack or human error (Butler, 2016). The examples given in Figure 3.2 are illustrative and would need to be amended according to the system in question and the operating environment of the user. Similar diagrams can help to show what a threat might mean for different elements of a system, or their impacts and consequences, including wider societal, economic and nexus issues.
Figure 3.2. Threat categorisation and examples
Source: Butler, D. et al. (2016), Reliable, resilient and sustainable water management: The Safe & Sure approach, Global Challenges, 2016.
Failure should not be accepted as an inevitable and uncontrollable state. Once the impact and consequences of failure have been identified, mitigation measures to ameliorate threats can be developed. Where mitigation is not possible, or only to a limited degree, adaptation measures involving targeted actions can be taken to enhance the capability of a system to maintain levels of service. And when failure does occur, coping actions can reduce the frequency, magnitude or duration of the effects of the impacts. All this experience and knowledge should then be embedded in best practice.
Droughts and flooding are just two of many potential threats to a city’s resilience, and should not be considered in isolation. The City Resilience Index (Box 3.2) provides a holistic articulation of city resilience, structured around four dimensions, including infrastructure and environment, to measure and test resilience in the round (Rockefeller Foundation, 2016). It would be a useful self-assessment tool for Korea.
Finally, governments and regulators should challenge delivery bodies to consider resilience in their planning and operational activities. This is now happening routinely in England and Wales, where the economic regulator Ofwat has been given a statutory responsibility to promote resilience among the companies it regulates.
Box 3.2. The City Resilience Index
The City Resilience Index (CRI) is a tool intended to help urban populations face the increasing challenges from natural hazards and manmade pressures, and to provide them with a framework to develop effective strategies to create more resilient cities. It is founded on evidence from 16 city case studies, and is now being adopted in 100 resilient cities around the world. Of the more than 1000 applications for the 100 Resilient Cities Network, over 60% indicated challenges with water as critical resilience risks. The CRI provides cities with an accessible, evidence-based definition of urban resilience, and is a mechanism to assess and monitor their present day resilience and their progress towards a more resilient future. The assessment helps cities to develop a deeper understanding of the systems, processes and functions that shape their resilience profile.
The findings from their assessments empowers cities to better identify appropriate actions to strengthen resilience, while allowing them to measure progress over time. It uses qualitative indicators based on specific questions to evaluate and identify the ‘qualities’ of urban systems, and aggregates scores to build the resilience profile for a city.
The CRI relates to four key dimensions: People, Organisation, Place and Knowledge; and uses 12 Goals, 52 qualitative and quantitative Indicators, and 156 Metrics, all of which provide a current snapshot of a city’s performance and its strengths and weaknesses, its potential to achieve greater resilience, and to assess whether its development trajectory is likely to make the city more or less resilient.
Source: The Rockefeller Foundation/Arup (2016), City Resilience Index – Understanding and Measuring City Resilience.
Using scenarios to test long-term policy options
Background: scenarios and forecasts
Scenarios can inform today’s thinking about strategic decisions through exploring different possible futures. They examine a range of internally consistent, plausible futures, not to forecast what they may be like, but to provide a mechanism for thinking through the challenges that might be encountered and the opportunities that might arise. Scenarios are most useful when there is uncertainty about some of the factors that may significantly shape the future and when a range of outcomes may be plausible (even if some are more plausible than others).
Conventional forecasting and predictive techniques, such as extrapolating trends, become unreliable as time horizons extend into years and decades, and errors accumulate. An additional challenge with forecasts arises from the dependence on decisions which are yet to be made, or on technologies yet to emerge. Box 3.3 illustrates these challenges with forecasts.
Box 3.3. Water demand forecasts will always be wrong: a case study from England and Wales
The dangers of relying upon a single forecast (of water demand) are well illustrated by a review of water demand forecasts for England and Wales. In the 1960’s and 1970’s growth forecasts made optimistic assumptions (Figure 3.3) about increases in industrial demand for water in north-east England, leading to the construction of the UK’s largest reservoir – Kielder Water. Instead, industrial demand collapsed and the reservoir has been significantly under-utilised ever since. Even though household demand for water is likely to increase in the future this will take place in the south-east of England and the reservoir is too far away for an easy transfer of water resources.
Figure 3.3 shows that since the mid-1990s, forecasts appear to have become more accurate, when compared with, in hindsight, actual demand for water. This is because they started to recognise that demand for water did not necessarily have to rise, and that leakage control and promotion of water efficiency could restrict or even reverse demand increases. The forecasts then started to become a self-fulfilling prophecy, in that by demonstrating what might be possible in terms of managing demand, policies were then developed to try and ensure that it did. From 1995, the significant demand reduction arose from a 40 per cent reduction in leakage, followed by increased household metering, promotion of water efficiency in households and industry, and the adoption of more water efficient fixtures, fittings and appliances. If there had been a scenario approach to planning in the 1970’s or 1980’s it might have identified the potential for demand reduction and led to an earlier policy discussion about the merits of demand management.
Figure 3.3. Water demand forecasts for England and Wales 1949 -2009 (dotted lines), compared with actual demand (solid line)
Source: Walker, G. (2013), A critical examination of models and projections of demand in water utility resource planning in England and Wales. International Journal of Water Resources Development, 29:3, 352-372.
Scenarios are not attempts to predict the future: rather, a set of scenarios collectively explores the parameter space in which the future might plausibly sit. This allows decisions to be stress-tested against whether they lock in to trajectories towards less desirable end states, and/or consideration of strategies that are robust to alternative directions. Given the uncertainties about how long land and water systems can be maintained on their current unsustainable trajectories, this avoids strategic lock-in to only “business-as-usual, plus-or-minus” thinking.
Scenario planning in practice
Most forecasts of future water demand project significant and sustained increases with consequent alarming implications for water stress. However, they give little or no recognition to how, for example, better policies and the increased adoption of demand management could lead to a more balanced and equitable allocation of water resources. By 2040 a significant proportion (40%) of the global population will be living in river basins under severe water stress (OECD, 2012). This takes no account that in most of the nations where this might be the case, they are unlikely to sleep walk into a crisis. There will be investment in additional resources, leakage reduction and demand management, and strengthened governance to manage resources more effectively and equitably. However, it does highlight the risk and consequences of complacency.
The scale at which an assessment is undertaken is also important. The same assessment suggests that Brazil will have no water problems in 2040. This is because the assessment uses the total national water availability and a simple ratio of withdrawals to supply. Given that ‘supply’ includes the Amazon, the national scale of the assessment ignores the fact that some parts of the country are already water stressed and in need of urgent reform to water management; this sort of forecast needs to be treated with caution.
For water, UNESCO (2012) has suggested the use of five possible scenarios (including a business-as-usual scenario), which reflect the potential dominance of key drivers. These are Business-as-usual ('Conventional world'), 'Conflict world', 'Techno-world', 'Global consciousness', and 'Conventional world gone sour'. The storylines or plots of each of scenarios have their merits; bespoke scenarios for the Korean context could include thinking from this approach by UNESCO.
An example of a national-level use of water scenarios is work by the UK Environment Agency (2009, 2017a) to develop a Water Resources Strategy for England and Wales (Box 3.4). This approach would potentially be appropriate for Korea, in that it would build in the range of possible impacts of climate change with uncertainties over future water demand and environmental protection.
Also relevant is the approach taken by Ercin and Hoekstra (2014), who developed scenarios for global water footprints. They constructed four scenarios along two axes, representing two key dimensions of uncertainty: globalisation versus regional self-sufficiency, and economy-driven development versus development driven by social and environmental objectives. Their approach could help to understand the range of possible impacts of different policy decisions and economic futures on agriculture, food production and land use in Korea.
Box 3.4. Scenario planning for the development of a Water Resources Strategy, England and Wales
The UK Environment Agency used a scenario-based approach to develop a Water Resources Strategy for England and Wales. The approach was based on the two key drivers or axes of control for water resources - governance and demand - and overlain with assessments of water availability under climate change projections. The plots for the four scenarios were centred on international governance systems (sustainability led-governance and growth-led governance), and on societal attitudes and behaviour around consumption (dematerialised consumption and materialised consumption). Importantly, the scenarios reflected the breadth of pressures on water systems, from changes in demand across all sectors – municipal, agricultural, industrial and environmental – to different societal attitudes to water use and governance, and under different socio-economic scenarios.
The demand-led scenarios provided an indication of the effects of different socio-economic policies and external evidence. They were then overlain with four climate change scenario assessments of the impact of a changing climate on water availability in each river basin, in order to understand the spatial implications for water availability. Finally, environmental flows were considered; England and Wales uses a sophisticated assessment based upon Environmental Flow Indicators for each water body, which sets e-flows on a variable basis. The concern for future assessments of water availability for human use under climate change is how much water needs to be left in the river for the ecology. Maintaining e-flows at their current level in the face of declining availability would significantly reduce volumes available for abstraction. However, given the uncertainty regarding what environment will need to be protected in a warmer, lower flow hydrology it was appropriate to also use scenarios for e-flows, allowing them to adjust pro rata – or not - with resource availability.
Scenario planning in Korea: a possible approach
Scenario choices for Korea could include:
Attitudes to sustainability: reflect a sustainable future where pollution is controlled, abstraction of water is managed, and ecosystems flourish. Demand for water would be managed, rural land use would ensure that the water environment was protected and diffuse pollution controlled, and cities would be greened so as to limit surface water flooding and treat rainfall as a resource.
Innovative future: how continued growth in GDP is maintained is closely linked to attitudes to innovation. Green growth, the circular economy and innovation can enable ecosystem services to be accessed and the value of natural capital realised more efficiently, even though the general public do not particularly value the environment. There is significant investment in infrastructure, technology and research. High-tech methods are used in agriculture to intensify production. Economic growth coupled with better use of technology results in greater social equity.
Making do with less: a decline in GDP, for whatever reason, could prejudice the ability to make ongoing investment in water supply security, and in maintenance and control systems. Water supply and sewerage networks would continue to deteriorate, with increases in sewer collapses and blockages, and more water lost through leakage. Industry would resist expensive measures to improve effluent standards, and river water quality would deteriorate. Land use controls could be relaxed, and agricultural intensification through aggregating land holdings would become necessary in order to ensure food security, even at the risk of further degradation of the environment. Fossil fuel power stations would continue to be used, and climate change mitigation and adaptation measures would be shelved.
Attitudes to self-sufficiency: global trends in resource availability and demand could lead to the need or desire to take a more insular and local approach, with the aim of national self-sufficiency as far as possible in goods, services and food. Under this type of scenario, water assets would be repaired rather than replaced, and attitudes to water allocation would be geared towards extracting the maximum value from each litre. The environment would be viewed as an asset to exploit, rather than to protect to maximise the breadth of ecosystem services. Water efficiency would become essential to help reduce energy demands and ensure that there were sufficient water resources to maintain production.
Uncontrolled consumerism: economic growth is pursued with little regard for the environment or social equity. Although the country prospers, the gap between the rich and poor widens, and the environment becomes a commodity that only the wealthy can enjoy. Urbanisation spreads, and sustainable land management is abandoned in favour of profiting from intensive agriculture and development. Increased demand for water means that it becomes more expensive to provide quality and reliability, further disadvantaging vulnerable sections of society.
Business as usual: extrapolating the consequences of current policy approaches to water and land management could result in water supply failures through droughts or increased leakage. The need to abstract more water from rivers already impacted by high demand would cause deterioration in river water quality because of lack of dilution, and further degradation by diffuse pollution, eutrophication and industrial pollution. Groundwater levels would decline because of unconstrained demand and quality would deteriorate.
These brief examples are intended to illustrate the sorts of scenarios which might be developed for Korea, and what they could suggest in terms of risks and policy responses. Scenario development needs to be an inclusive and participatory activity, to ensure that a wide range of stakeholder views are taken into account; this will make the scenarios more robust and realistic.
It is unlikely that any single policy option will be resilient against all possible futures, but some (such as managing demand for water) will be low regrets. Options which are scalable and can be adopted incrementally will be able to respond better as more certainty emerges about the future. Some will be particularly effective in addressing some scenarios, but will fail spectacularly under others; this may not matter too much as long as their weaknesses are understood and other policy options are able to manage the risks created by a particular course of action. In particular, scenarios can be very helpful in managing nexus issues, since they allow for the integrated assessment of different outcomes from policy decisions affecting different elements of the WELF nexus.
Scenarios to support coordinated planning for the WELF nexus in Korea
The incorporation of climate change and socio-economic scenarios into water plans and river basin plans allows decisions for each of these challenges to be tested for potential conflicts and for their robustness in the face of uncertainty. The plan can then drive decisions on day to day operations in a catchment, as well as permitting policy, drought and flood responses, land management, and investment for water supplies or pollution control. Where there is uncertainty, the planning process can specify actions which are incremental or flexible, or can develop a range of options to be implemented as and when necessary depending on the nature of short term events, or longer term trends. By having an integrated and flexible approach to planning, the costs and funding streams can be identified early, and synergies exploited to achieve greater cost efficiency.
3.2. The case for independent regulation
Regulation that is independent of policy-making is important in delivering confidence to consumers, legal services providers, investors and society as a whole. Regulators are key players in the policy arena with an active role in implementing public policies, and overseeing delivery bodies, and are defined “as an entity authorised by statute to use legal tools to achieve policy objectives, imposing obligations or burdens through functions such as licensing, permitting, accrediting, approvals, inspection and enforcement” (OECD, 2016).
There are three core elements of water regulation:
Protecting the environment: ensuring that standards are set and met in order to achieve policy objectives, and that abstractions and discharges operate within safe limits.
Protecting customers’ interests (economic regulation): ensuring that the delivery of water supply and sanitation is efficient, the level of charges fairly reflect and fund the quality of service delivered, and that there are equitable, transparent grievance and remedy mechanisms that allow individuals to complain.
Protecting drinking water quality: providing confidence to customers that water treatment processes are effectively managed and monitored, and that tap water is safe to drink.
3.2.1. Principles and practice of good regulation
For all three aspects of water regulation described above, the following principles should apply:
Proportionality. Solutions must be proportionate to the perceived problem or risk of adverse consequences, and justify the compliance costs imposed. Enforcement should be proportionate to risk. For example, does every type of abstraction or discharge require the same type of permit or level of scrutiny? Or are some a lower risk (e.g. small scale agriculture for household use) and simply require registration, while others (e.g. industrial abstractions from a fully committed river) require more detailed analysis and stringent conditions?
Accountability. Regulators must be able to justify their decisions, and should be open to public scrutiny. They must be able to justify how and why decisions are reached and there should be fair and effective complaints procedures, ideally with independent oversight and the right of appeal.
Consistency. Rules and standards must be joined up and implemented fairly, and regulation must be predictable in order to give stability and certainty to those being regulated. Consistency is about taking a similar approach in similar cases to achieve similar outcomes.
Transparency. Policy objectives must be clearly defined and communicated, and have been subject to consultation and engagement. Those being regulated should be made aware of their obligations and given the time and support to comply. The consequences of non-compliance should be made clear, and there should be public access to compliance information.
Targeting. Regulation should be focused on the problem, and effort should be prioritised on those activities, actions and operators that pose the most risk. Where appropriate, a goals-based approach, with clear, unambiguous targets should be adopted, to allow flexibility in using innovative alternative solutions to be considered as mechanisms for addressing the problem.
If regulation is working well, there will be a culture of trust and openness between the regulator and the regulated body, whether public or private. Service deliverers (for water supply and sanitation), farmers and industrialists will understand what they must do to comply with regulatory standards, and routinely and willingly go beyond the regulatory minimum in looking after the interests of customers and the environment. Ultimately, regulation should become more strict for those who deliberately or significantly break the rules, and penalties should be applied rigorously and fairly. Where there are major breaches in compliance, such as drinking water standard failures, or large scale pollution incidents, there needs to be an agreed and publicly transparent process for applying penalties in an equivalent manner to those levied on the private sector. In view of the general mistrust of tap water quality in Korea, independent oversight could help to restore public confidence. Without this, regulators’ credibility and impartiality may be called into question.
Although independence is central to effective and fair regulation, governments may take the view that some decisions, such as on major infrastructure projects, require a wider perspective than a regulator might be able to provide. In these cases, there should be widespread consultation among stakeholders, and a thorough Environmental Impact Assessment should be made available for comment and open debate.
Given the potential impact of water and wastewater service provision on the environment, environmental regulation is also essential to provide a holistic and integrated approach with all other activities, across all sectors, within a river basin. This will ensure that permit standards for abstractions and discharges are defined in accordance with water policy objectives, and are based on robust evidence in terms of the state of the environment and ecosystem needs, and the priorities set out in a river basin plan. Compliance must also be transparently monitored and effectively enforced to ensure equity across all permit holders in all sectors.
3.2.2. Options for delivering independent water regulation
Countries regulate the protection of the environment, customers’ interests and drinking water quality in different ways. Independent regulation can be achieved by any one, or a combination of, the following four models (OECD, 2015a):
1. Regulation by government. The public sector is responsible for the management of the water services and owns the assets. Service provision is delegated to public water operators while regulatory functions are carried out directly by the State at different levels: central, regional or municipal. This is the model adopted in the Netherlands, and to a lesser extent, in Germany. The challenge for this regulatory model is that one public body is regulating another.
2. Regulation by contract. The regulatory regimes are specified in legal instruments, and although public authorities are responsible for regulation, water service delivery can be delegated to private operators through contract agreements. These set the rights and obligations for each contracting entity, and service provision is awarded to private companies following public tender. This model is used in France.
3. Regulation by one or multiple independent regulators, where independence has three dimensions: independence of decision making, of management and of financing. This is the model used in the United Kingdom, where the regulatory framework is organised around three dedicated agencies with statutory functions relating to pricing and customer service (Ofwat), drinking water quality (Department for Environment, Food and Rural Affairs), and environmental regulation and security of water supply planning (UK Environment Agency).
4. Outsourcing regulatory functions to third parties. This model makes use of external contractors to perform activities such as tariff reviews or benchmarking. In practice, whatever regulatory model is adopted, most regulators will contract out some specialist work such as studies, data analysis, customer surveys etc. Outsourcing all regulatory responsibilities, however, is likely to lead to public concerns about independence, and the potential for corruption or lack of accountability.
The regulatory functions (protection of the environment, customers’ interests and drinking water quality) do not necessarily have to be in the hands of a single institution responsible for all of them. Hybrid models are possible, to reflect other institutional, policy and legislative arrangements within a country that the regulators need to take account of or interact with. For example, in England three independent water regulators each have a different organisational relationship with the government, and have clearly defined and separate statutory roles:
The economic regulator, Ofwat, is a non-ministerial government department, accountable to Parliament rather than a minister. It makes independent decisions, guided by government policy objectives.
The Drinking Water Inspectorate acts on behalf of the Secretary of State for Environment, Food and Rural Affairs, and is part of his Department (Defra), but the Chief Inspector has vested powers which ensure clear independence in the work of the Inspectorate.
The UK Environment Agency is a non-departmental public body, which operates as an executive delivery body on behalf of Defra Ministers.
There is no ideal model; regulation should be adapted to local circumstances, and reflect hydrology, culture, legislation, institutional arrangements and challenges. It is essential, however, that regulation is able to operate without being subject to influences that would prejudice its independence and credibility. The actual or perceived level of autonomy will affect the degree of trust and confidence in regulatory decisions. Explicit de jure independence through specific legal measures is one way of achieving this; de facto independence is ensured through a mixture of governance and operational modalities. Ideally, both would be in place.
The complex and fragmented nature of water governance in Korea means that responsibility for water planning, regulation and management, and water supply and sanitation, is spread across many different policy and delivery bodies. Accountability is equally diluted and unclear, and water and wastewater suppliers, and agriculture and industry are seldom held to account. Independent regulation in Korea (using one, or a combination, of the four models above) may be an effective response to some of the challenges to regulating water services, including the fragmentation of roles and responsibilities in the sector, the public distrust in drinking water services, and the limitations of the tariff setting process.
3.2.3. Regulation to look after customers’ interests for water supply and sanitation
Regulators sit between government and its policy making, the bodies responsible for the delivery of water supply and wastewater services, and their customers. This means that they must translate government policy aims into operational standards for those whom they regulate.
How a regulator acquires performance information and sets performance targets is important in bridging any gap between government and customer expectations. An outcome-based approach helps to ensure that the focus is not simply on easily measured outputs, but also considers the longer-term aims for water and sanitation, and the environment. It should expect the delivery body to monitor its service to customers, the operational performance of its assets, and how it is planning for resilient systems operation in the face of shocks, such as drought, process failures or cyber-attacks. The targets, and performance against them, should be published and made available to customers. Suggested performance targets are presented in Box 3.5.
Box 3.5. Performance targets for regulators of water supply and sanitation services
The performance targets for water supply and sanitation services could include:
Compliance with environmental permits and standards (integrating with and reinforcing the role of the environmental regulator, where this is separate). This can also be an indicator of the quality and state of drinking water and wastewater treatment infrastructure assets.
Leakage performance and targets for reducing leakage and other unbilled losses, such as illegal connections or treatment process water.
Reducing per capita consumption for households and demand in other sectors on mains supplies.
Wastewater pollution incidents, such as from too frequent operation of combined sewer overflows, or major failures at wastewater treatment works.
Sewer collapses (as a proxy for sewer asset condition).
Mains bursts (as a proxy for distribution network condition).
Unplanned outages (loss of supply because of bursts, contamination etc.).
Risk of demand restrictions in a drought.
Drinking water quality compliance (integrating with and reinforcing the role of the drinking water regulator, where this is separate).
Customer experience: how well billing queries are dealt with, information about planned outages and supply interruptions.
The regulator will also want to satisfy itself that the service is being delivered efficiently, and may set incentives and penalties to encourage this. Benchmarking can provide some indication of comparative efficiency, but needs to be treated with caution that like is being compared with like.
Customers should expect to be able to express their views on levels of service, priorities for investment and options for major infrastructure where this is proposed. The extent to which customers participate in the development of business plans can influence both their behaviour – and how much they value water and the service they receive – and that of the delivery body.
The income from water bills should cover not only operational expenditure but also capital and revenue investment to improve resilience and levels of service. In other words, the regulator needs to ensure that the delivery body is funded to deliver efficiently the breadth of its services to the required standard. For household water and sanitation bills, affordability issues are best dealt with through the use of social tariffs or income support measures (outside of the water bill), rather than keeping water bills low and failing to raise adequate revenue and an understanding of the value of water and sanitation services. The United Nations has stated (UN, 2017) that regulatory frameworks must not interfere directly or indirectly with people’s existing access to water and sanitation. States must ensure that disconnections due to inability to pay are prohibited. The regulator should seek to moderate bill increases so that it can satisfy itself, and others, that they are necessary and appropriate.
3.2.4. Drinking water regulation
Regular, thorough, comprehensive and accurate testing of water put into supply is crucial to ensuring that customers have confidence in the product they receive at their tap. This is not currently the case in Korea, where past high-profile river pollution incidents have eroded public trust and led to widespread use of bottled water and filters (Um, Kwak and Kim, 2002).
A drinking water regulator’s role is to act as an independent auditor of the tests carried out by the water supplier, to enforce drinking water standards and to investigate breaches. The competence of staff and the laboratory facilities and analytical processes would all form part of regulatory scrutiny. Inspectors should have the powers to require the water supplier to make improvements where necessary, and to take enforcement action (including financial penalties) where this is not carried out within a set timescale.
A drinking water regulator, like other regulators, may take a risk-based approach to compliance monitoring. If a water supplier has a positive and consistent record of providing safe drinking water with no failures, and laboratories are well-run and pass routine audits, then the frequency of checks and inspections can be reduced. Conversely, a poor performing supplier can expect much more frequent compliance monitoring and demanding scrutiny. The fundamental aim of the independent regulator should be that the public have confidence in their drinking water and trust in the credibility of the regulatory regime.
It should be the aim of the supplier to minimise the risk to customers by protecting their sources of drinking water supply from contamination. When there is a drinking water quality incident, whether from chemical or microbial contamination, there should be a full investigation and lessons learnt applied and widely disseminated to other suppliers. The strict health-based standards used in Europe are based on expert global opinion documented in World Health Organisation Guidelines for Drinking Water Quality (WHO, 2011).
3.2.5. Water environmental regulation
The role of a water environmental regulator is integral to the delivery of the targets for river flow and quality set out in a River Basin Plan. The limits and conditions on permits to abstract and discharge should be set to ensure a sustainable flow regime, and to improve or protect water quality as appropriate. The regulator’s job is then to ensure that the permits are being complied with, and to take enforcement action where they are not.
3.3. Additional instruments necessary to manage the WELF nexus in Korea
3.3.1. Permitting
Water management permitting is a fundamental mechanism by which resources are managed to protect and improve the environment, and to ensure that the needs of societies and economies are met. Effective permitting requires good data on resources and efficient administrative and technical decision making processes, aimed at delivering clear policy objectives. A deficiency in any one of these elements will lead to a poor service to the permit applicant, the environment or society.
Water quality modelling in each basin will inform the discharge permitting process about the safe load for each critical pollutant at different points in the main river and its tributaries. This will be based upon the impact on the ecosystem and the need to protect or improve it from the effects of harmful discharges, both point source and diffuse source, in aggregate with the presence of any toxic substances naturally occurring in the watercourse. For example, a river with a high background concentration of heavy metals as a result of the geology of the catchment would have a lower assimilative capacity for those pollutants where present in effluent downstream. The limits set in permits should take account of the flow regime in the river and the capacity to dilute polluting discharges. There needs to be a close relationship therefore between flow management and abstraction controls, and the approach taken to wastewater management, land use, water quantity and quality are inextricably linked.
The equivalent protection for the river in respect of abstraction impacts comes from the setting of e-flows: environmental or ecological limits on the maximum acceptable divergence from a natural flow regime caused by abstraction. Some countries (OECD, 2015b) simply set a minimum acceptable flow and allow abstraction down to that limit; however, this potentially has the effect of creating drought conditions for most of the year, which many ecosystems would struggle with. It is now generally accepted that to support a healthy aquatic ecology a more sophisticated approach is needed. This recognises that ecosystems in some parts of a river – typically in the fast flowing shallow headwaters and tributaries – are more sensitive to changes in flow and level than elsewhere, such as downstream reaches where flows are more sluggish and the river occupies a U-shaped channel. It also recognises that flow variability is important. Checklists for assessing an application for abstraction and discharge permits are provided in Annex 3.B.
Permitting systems in most countries are set up either to deal with a current challenge, or to try and resolve legacy problems. It is rare for them to be forward looking, which is why most international approaches to the control of pollution and abstraction are subject to ongoing processes of either major or minor reform in an attempt to catch up. With investment in monitoring and assessment, and in planning, Korea could be well placed to make a step change to its permitting processes so that they are fit for purpose for the future and so reduce the need for retrospective reform in the future. The regulatory principles set out above could form the basis of a more risk-based, environmentally sustainable process for managing and protecting water resources for the future, and so reduce the need for retrospective reform.
The current basis for managing groundwater abstraction would benefit from a review. It is not clear how robust is the existing assessment of the available resource in each aquifer unit, both shallow and deep, since groundwater abstractions are neither regulated nor monitored. The key issue is the lack of permitting of groundwater abstraction to prevent excessive abstraction rates becoming a problem. Where there is high hydraulic conductivity and a concentration of wells and boreholes, it is almost inevitable that there will be interference between them, coupled with an overall lowering of the water table and potentially also an impact on surface waters. Measures to protect surface waters from pollution also need to be designed to minimise the risk of groundwater pollution. Long residence times in some aquifers could mean that they become progressively unusable because of contamination. Where ‘hotspots’ exist there should be increased monitoring of groundwater levels and quality, and compliance with stringent permit conditions. The development of numerical models would help in the assessment of new abstractions, and a requirement for test pumping at critical sites would aid their calibration. Metering abstractions would increase confidence in when and where the resource was being used. The OECD study on sustainable agricultural groundwater use (OECD, 2015c) sets out six general conditions for successful management:
1. Build and maintain sufficient knowledge of groundwater resource and use
2. Manage surface and groundwater conjunctively (together) where relevant
3. Favour instruments that directly target groundwater use over indirect measures (e.g. land use regulation), where possible
4. Prioritise demand–side approaches
5. Enhance the enforcement of regulatory measures (e.g. water entitlements) before moving to other approaches
6. Avoid non-water related price distorting policy measures, such as subsidies towards water intensive crops and energy that could affect groundwater use.
Permitting policy should not be static; it needs to adapt to improved knowledge and changing circumstances. This is more easily achieved if permits are reviewable, without the need for compensation of the permit holder (a major issue with abstraction permits in many countries), and are capable of being strengthened as necessary.
The following are points to consider in order to strengthen the sustainability of water permitting activities in Korea:
Review current policies and procedures against the five principles of better regulation, and adapt permitting and enforcement accordingly.
Use risk assessments to determine how decisions are made and the type of permit, and its enforcement.
Review the water allocation regime in terms of ‘how much for the river’ and the controls on surface water abstractions, and manage pollution with reference to the environmental capacity of the receiving watercourse. Refer to the OECD Water Allocation Health Check (OECD, 2015b).
Review the need to commence groundwater permitting on a risk basis, including an assessment of interference between boreholes and their impact on surface waters, and the risk of saline intrusion. Consider the use of test pumping and numerical models as aids to decision making.
Establish a mechanism to ensure that permitting policy can adapt as rainfall, river flows, groundwater yields and human demands change over time, so that it becomes flexible and adaptive, and able to maintain sustainable exploitation of natural resources.
3.3.2. Compliance monitoring and enforcement
Current enforcement practice in Korea is problematic; permit holders are reluctant to comply with the terms of their permit, and there have been few severe sanctions for breaches of conditions. In 2013, only 1.5% of water pollution cases were referred for criminal investigation (OECD, 2017b). Public prosecutors assign relatively low priority to environmental offences and rarely pursue such cases, and judges generally lack the expertise to consider the merits of environmental breaches. The approach to inspecting discharges is also an issue; during the fact-finding mission in Korea, it was suggested that although permit holders are required to report on their discharge quality, few do so in practice. The routine water quality monitoring regime can sometimes identify problems, but is not designed to be operational monitoring and so many breaches of discharge permits will go undetected and unenforced.
Permitting, inspection and enforcement should operate seamlessly together for the sustainable regulation of water resources quantity and quality. Ineffective enforcement means that the permit has failed to deliver the intended outcome - to allocate and protect water resources sustainably, for the common good. Failure to enforce undermines the purpose of the permit and the underlying legislation.
Any inspection regime will have to balance the need to ensure compliance with permits where and when it is most important, against the available staff resource and budget. This might mean that some lower risk permits would be inspected very infrequently, but they would still be part of the programme of visits. Where resources are limited, action should be targeted on the basis of risk (Box 3.6).
Box 3.6. Risk-based compliance monitoring and enforcement checklist for water abstraction and discharge permits
Target resources and action according to:
Risk to the environment from failure to comply with permit conditions
Risk to other water users, including the environment
The likelihood of the operator not complying (i.e. some permit holders will be more inclined to cheat; their track record is an important consideration)
During periods of stress from drought, when exceptional measures are in place and need to be complied with
Where there is a concentration of permit holders and there is a need to demonstrate that compliance is important, and breaches will be enforced
Where complaints demonstrate concern from the local community.
For water abstraction permits, the measurement condition is perhaps the most important in terms of compliance, and one of the most straightforward to enforce. Either a water meter is in place or it is not. And if it is installed, is it working and is the calibration up to date? For discharge permits, the critical issue is the polluting load into the watercourse and whether it is in accordance with the permit conditions. Routine sampling and reporting by the operator, with periodic independent checks, are essential.
To track compliance monitoring performance, an important metric is the percentage compliance according to the risk category of the permit. The effort should be to ensure that the highest risk permits (or permit holders) have a high compliance ratio. For very low risk permits, a lower proportion of compliance might be acceptable, because the impact would be limited. The outcome from effective inspection and enforcement should be to ensure that, if compliance is maintained, the environment and water users are protected. Where monitoring suggests that environmental problems exist, these can then be dealt with by tightening permit conditions or tackling the causes by using different policy mechanisms where they are not able to be dealt with through conventional permitting, such as diffuse pollution from agriculture (see section 2.3).
If enforcement is weak, then there is no way of knowing whether the permitting regime is also too lax. A robust permitting and compliance monitoring regime is essential to provide public confidence in water management, and to ensure fair treatment for all water users. Poor performers are often minimising their operating costs whilst imposing higher costs on other water users because they are polluting or reducing water availability. Points to consider when assessing inspection and enforcement activities of permits are as follows:
Review the inspection programme according to risk criteria appropriate to each basin or catchment.
Ensure that the inspection visit raises awareness of the consequences of non-compliance.
Follow up permit breaches with enforcement. Depending on the severity of the breach, and the attitude of the permit holder, this could range from a verbal warning, to a written warning, to sanctions or a fine, or criminal prosecution.
If necessary, use enforcement mechanisms to set an example of persistent poor compliance, and publicise the action taken as a warning to others.
Environmental regulation should be applied fairly and consistently to all those that use and abuse the water and land environments. The EU Water Framework Directive calls on Member States to ‘determine penalties applicable to breaches’ which should be ‘effective, proportionate and dissuasive’ (EU WFD Article 10). Most European countries use operator self-monitoring, where the permit-holder is responsible for monitoring and reporting on compliance with permit conditions for abstraction and discharges. This brings risks if quality assurance methodologies and risk-based compliance monitoring are not in place, or are ineffective. The penalties for non-compliance, especially in the most severe cases of failure, can act as deterrents.
3.3.3. Environmental Impact Assessment
Environmental Impact Assessments (EIAs) have been in use in Korea since the 1980’s, and are required as a precondition for a construction permit in 17 activity sectors, mostly covering infrastructure development (OECD, 2017b). Industrial sites less than 150 000m2 are subject to a “strategic” EIA based on the project concept, and sites greater than 150 000m2 are subject to a comprehensive EIA. The required scoping report is reviewed by a locally relevant committee of public officials, experts and residents’ representatives. The authorities consider the public’s comments upon review of EIA reports. The ME must be consulted before approval. The operator is responsible for monitoring the project’s impacts, and reporting to the ME and the approving authority. The ME has developed extensive guidelines and regulations, and an online support system helps to ensure transparency.
The challenge for any major development which has the potential to impact the water cycle is to ensure that there is a comprehensive assessment which considers it from the perspective of the entire river basin. For land-based development, this means considering (mainly) the downstream impacts on flood risk and water quality, as well as its water demand. For water developments, such as a dam or weir that causes an obstruction to flow, the concerns might also include the effect on the passage of fish, or the potential for increased eutrophication. If the baseline data are poor, then the assessment will also not be able to identify the full range of impacts, leading to unforeseen and usually adverse consequences. The objectives set out in an integrated river basin plan also provide a benchmark against which to test the potential impact of any proposed development, whether for water supply, flood risk management, urban expansion or other major land use change. The European Union has published guidance (EU, 2017) which describes in a practical way the steps to be followed in an EIA and the preparation of the report.
The application of the above reasoning and EU guidance to EIA processes in Korea would help to address concerns about the quality and independence of such assessments, and the impact of new developments. Extensive consultation is a key element of the EU’s legal requirement for EIA; this can help to reassure affected stakeholders and also be a way of using their local knowledge to support the assessment.
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Annex 3.A. Integrated river basin planning: The European Water Framework Directive
Most countries now aspire to use integrated river basin management as the basis for managing water resources and the associated land environment, and their interactions. The European Union has established a process for Member States to follow, which is one of the most structured in the world: the Water Framework Directive.
The purpose of the Directive is to establish a framework for the protection of inland surface waters (rivers and lakes), transitional waters (estuaries), coastal waters and groundwater. It aimed to ensure that all aquatic ecosystems and, with regard to their water needs, terrestrial ecosystems and wetlands, met 'good status' by 2015. Where this was not possible, longer timescales are permitted subject to justification. The Directive requires Member States to establish river basin districts and for each of these to prepare a river basin management plan. The Directive sets out a cyclical process where river basin management plans are prepared, implemented and reviewed every six years. There are four distinct elements to the river basin planning cycle: 1) characterisation and assessment of impacts on river basin districts; 2) environmental monitoring; 3) the setting of environmental objectives; and 4) the design and implementation of the programme of measures needed to achieve them.
There are a number of objectives in respect of which the quality of water is protected. The key ones at European level are general protection of the aquatic ecology, specific protection of unique and valuable habitats, protection of drinking water resources, and protection of bathing water. All these objectives must be integrated for each river basin. The central requirement of the Directive is that the environment be protected to a high level in its entirety.
For this reason, a general requirement for ecological protection, and a general minimum chemical standard, was introduced to cover all surface waters. These are the two elements "good ecological status" and "good chemical status". Good ecological status is defined in terms of the quality of the biological community, the hydrological characteristics and the chemical characteristics. As no absolute standards for biological quality can be set which apply across the Community, because of ecological variability, the controls are specified as allowing only a slight departure from the biological community which would be expected in conditions of minimal anthropogenic impact. A set of procedures is provided for identifying that point for a given body of water, and establishing particular chemical or hydromorphological standards to achieve it, together with a system for ensuring that each Member State interprets the procedure in a consistent way (to ensure comparability).
Good chemical status is defined in terms of compliance with all the quality standards established for chemical substances at European level. The Directive also provides a mechanism for renewing these standards and establishing new ones by means of a prioritisation mechanism for hazardous chemicals. This will ensure at least a minimum chemical quality, particularly in relation to very toxic substances, everywhere in the Community. The list of chemicals is kept under review, and priority substances added to the monitoring and reporting schedules as new ones become of concern.
Some of these uses impact not only on flow or quality, but also on the hydromorphology: the physical characteristics of the shape, boundaries and content of a water body. Increasingly, this is recognised as fundamental to the classification and health of a river. Put simply, even if the river sustains a healthy flow of clean water, it will never support the ecosystem it should if the flow is constrained within a trapezoidal concrete channel, or interrupted by dams and weirs. Hydropower, water supply and agricultural reservoirs, and flood risk management structures can, if poorly designed and operated, have a major adverse impact on river ecosystems.
Once the objectives have been established for the river basin an analysis of human impact is conducted so as to determine how far from the objective each body of water is. The Member State must identify the causes of failure and design whatever additional measures are needed to satisfy all the objectives established. These might include stricter controls on polluting emissions from industry and agriculture, or urban waste water sources. Agricultural diffuse pollution is one of the greatest challenges across much of Europe. Improved monitoring is also showing the presence of metals, pharmaceuticals, hydrocarbons, biocides and industrial pollutants, derived from both point source and diffuse sources, and at levels which are raising concerns.
All the elements of this analysis must be set out in a plan for the river basin. The plan is produced by the ‘Competent Authority’ and is a detailed account of how the objectives set for the river basin (ecological status, quantitative status, chemical status and protected area objectives) are to be reached within the timescale required. One additional component is that an economic analysis of water use within the river basin must be carried out. This is to enable there to be a rational discussion on the cost-effectiveness of the various possible measures. It is essential that all interested parties are fully involved in this discussion, and in the preparation of the river basin management plan as a whole. This is the final major element of the proposal: the public participation requirements, since the decisions on the most appropriate measures to achieve the objectives in the river basin management plan will involve balancing the interests of various groups. The economic analysis requirement is intended to provide a rational basis for this, but it is essential that the process is open to the scrutiny of those who will be affected.
The river basin management plan must first be issued in draft, and the background documentation on which the decisions are based must be made accessible. After this consultation the plan is modified as necessary, and is then published. Each action will have been costed as part of the options appraisal process, and the organisation responsible for its delivery is identified. Progress is monitored and reported on, both locally and to the Commission.
The need to conserve adequate supplies of a resource for which demand is continuously increasing is also one of the drivers behind what is arguably one of the Directive’s most important innovations - the introduction of water pricing. Adequate pricing acts as an incentive for the sustainable use of water resources and helps to achieve the environmental objectives under the Directive. Member States are required to ensure that the price charged to water consumers - such as for the abstraction and distribution of fresh water and the collection and treatment of waste water - reflects the true costs. Although this principle has a long tradition in some countries, this is currently not the case in others, who are having to introduce meaningful charges.
The Water Framework Directive has been instrumental in providing a focus on water resources based on the most rational unit – the river basin or catchment – and in reinforcing the relationship between land management and the water environment. It has also ensured that Member States’ monitoring programmes are comprehensive (typically around 40 separate criteria) and able to provide, for the first time, a more realistic assessment of the state of the environment and the extent of the human influences on it. It has also been a catalyst for wider engagement and discussion on water and, critically, providing a mechanism to apportion ownership of the necessary actions to deliver improvements.
Annex 3.B. Checklists for assessing applications for water abstraction and pollution discharge permits
Checklist for assessing an application for a water abstraction permit
The basic questions to be addressed in determining any application for an abstraction permit include:
Is it a valid application: does it comply with the relevant legal and administrative requirements?
Are the volumes of water applied for reasonable for the required purpose? It is poor management to permit more water than is needed, since this ties up a resource which others could use. Equally, someone might apply for less than they need in order to reduce charges, and then breach the terms of the permit.
Is the resource available for permitting in the surface water body or aquifer?
What will be the impact of the abstraction on other, existing abstractors and water users? If it is a borehole, will it lower the water table unacceptably for nearby existing boreholes?
What will be the impact of the abstraction on the water environment of the river? Or if it is a groundwater abstraction, on wetlands and river flows?
What conditions need to be applied to protect low flows in dry years, or other water users? Are they enforceable?
How must the abstraction be measured, and at what frequency? If a meter is to be used, how often should it be calibrated?
How will change be dealt with; for example, following improved flow monitoring and assessment of resources, or of ecological need? Should the permit be time-limited or subject to periodic review as necessary?
What information about volumes abstracted is required for water management purposes, and at what frequency?
Source: Professor Ian Barker, Water Policy International, Pers. Comm.
Checklist for assessing an application for a pollution discharge permit
The basic questions to be addressed in determining an application for a discharge permit include:
1. Is it a valid application?
2. Do the volumes seem reasonable for the type of process involved?
3. What pollutants are likely to be present in the effluent, in what concentration?
4. What is the current water quality of the receiving water, and what are its target water quality objectives?
5. Is there sufficient flow to absorb and dilute the additional load from the permit and still meet the objectives?
6. What standards need to be applied to the range of pollutants likely to be present in the effluent?
7. What additional conditions are required, for example, in relation to sample frequency and analysis by the permit holder and submission of information? Or for monitoring of the effluent flow volumes?
8. If the effluent is important in maintaining low flows in the receiving river, and so acting as a resource for others to use, does there need to be a requirement to maintain the discharge at that location?
9. How will change be dealt with; for example, in the objectives for the river or improved understanding of the toxicity of the pollutants in the effluent?
10. Should the permit be time-limited, or subject to periodic review as necessary?
Source: Professor Ian Barker, Water Policy International, Pers. Comm.