In 2013, governments and companies invested $9.6 billion in initiatives implementing nature-based solutions to sustain the world’s clean water supplies, according to a new report from Forest Trends’ Ecosystem Marketplace.
Gaining Depth: State of Watershed Investment 2014 reports that more than 90 percent of watershed investment came from national public subsidies, including $8.8 billion attributed to Chinese government programs that compensate landowners to restore watersheds in order to address ongoing water pollution and supply challenges. Elsewhere, governments paid farmers, forest managers, and other landowners to adopt water-friendly practices such as removing invasive plants, using less fertilizer, or replanting forests.
This funding – which supports healthy watersheds that naturally filter water, absorb storm surge, and perform other critical functions – flowed to more than seven million households and restored and protected a total of 365 million hectares (ha) of land, an area larger than India.
Up from $8.2 billion in investment tracked in 2011, the researchers say the sector’s continued growth and near-doubling of the hundreds of operational programs reflects governments’ desire to secure water quality and availability with affordable strategies that can complement or replace industrial infrastructure.
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The private sector invested another $41 million into watershed health. Particularly active were businesses with obvious exposure to water-related risks, such as private water utilities and the food and beverage sector. The Coca-Cola Company alone has invested at least $2.2 million to date to support 20 such projects worldwide.
Other risk-exposed businesses such as energy utilities or agricultural producers were less active in 2013, with market participants linking under-investment to continued uncertainty around the water regulations that incentivize or compel restoration payments, as well as a lack of clear information about programs’ return on investment (ROI).
Respondents to Ecosystem Marketplace’s survey reported $6 billion that has already been committed to watershed investment activities through 2020. Leaders in the field are looking to the private sector, climate finance, and the re-allocation of infrastructure spending as future financing channels.
On Monday, global leaders gathered in Stockholm for 2014 World Water Week, urging the energy and water communities to work together to provide clean drinking water and energy for a growing world population. With the theme of "Energy and Water," the 24th annual World Water Week is aimed at finding solutions to challenges in optimizing these resources while acknowledging their interdependency. The U.S. Water Partnership announced the launch of a new platform, H2infO, that offers simple online access to a wealth of U.S.-generated water data and knowledge. H2infO was created to fill a gap in knowledge management identified by the international water community. The Partnership says by the end of 2014, more than 10,000 water resources from leading U.S.-based institutions will be centrally accessible through the expanding tool.