There is a significant and growing body of scientific evidence documenting that climate change will intensify the risks of water-related hazards. By creating a warmer lower atmosphere, climate change is altering the water cycle through an increase in evaporation, evapotranspiration and precipitation and changes to atmospheric circulation, which can lead to wet regions becoming wetter while dry regions become drier.
Compounding these risks, a deteriorating natural environment worldwide is increasing vulnerability to water-related hazards. A range of interlinked pressures, such as the loss and degradation of natural areas like wetlands, soil sealing and the densification of built-up areas are undermining ecosystem functionality. This challenges the provisioning of ecosystem services, resulting in negative impacts on human well-being.
To reduce the exposure to water-related risks, countries have made significant investments in grey infrastructure, such as dikes or dams. While they have provided protection and other vital services on which human lives depend, such as regulating water supply and generating hydropower in the case of dams, they equally have limitations. First, grey infrastructure can be costly to build and to maintain, and when it fails, it has shown to cause significant ripple effects. Second, grey infrastructure is long lasting and inflexible, and in the past has been designed assuming static hydro-climatic conditions. For example, coastal defences have become increasingly expensive to adapt to rising sea levels (e.g. by widening or raising) and to maintain over time. The high costs of adapting inflexible grey investments can lead to vulnerability to failure under changing climatic conditions. This puts large, costly infrastructure projects at risk of becoming ‘stranded assets’, failing to deliver their designed services when conditions change, with potential catastrophic consequences (such as a dam breach). Finally, grey infrastructure can undermine the ability of natural systems to regenerate – for example, coastal dikes can intensify land subsidence and prevent the natural accumulation of sediments by tides, waves and wind.
There is increasing evidence on the performance of nature-based solutions (NbS) to reduce water-related risks, highlighting features which make NbS particularly well suited for adapting to changing climatic conditions. These include:
There is growing evidence of the economic benefits of maintaining natural habitats through avoided losses to water related disasters. For example, in the Northeast of the United States, protected coastal wetlands are estimated to have helped prevent over USD 600 million of direct property damages during Hurricane Sandy. Globally, it is estimated that without mangroves, 15 million more people would suffer from flooding annually.
Research has shown that in some cases, NbS can be more cost-effective than grey alternatives, and in particular for less extreme hazards. For example, across 52 coastal defence projects in the United States, NbS were estimated to be 2-5 times more cost-effective than grey infrastructure, and most effective to defend against waves up to half a metre high and at increased water depths. However, studies which compare the value of NbS to alternative approaches are rare, and economic appraisals often do not properly capture or value the full suite of co-benefits of an NbS.
In addition to reducing losses and damages, the multiple co-benefits of NbS can have significant economic value. For example, in Europe, it was found that restored rivers, in addition to increasing flood protection, enhanced agricultural production, carbon sequestration and recreation, yielding an estimated net societal economic benefit over unrestored rivers of an estimated €1400 per hectare per year.
Finally, investments in NbS can stimulate the economy by creating jobs, much the same way as investments in grey infrastructure. For example, the American Recovery and Reinvestment Act of 2009 financed coastal habitat restoration projects that yielded 17 jobs per million dollars invested. In the European Union, it is estimated that restoring 15% of degraded ecosystems, consistent with Target 2 of the EU 2020 Biodiversity Strategy, would result in between 20,000 and 70,000 full-time jobs.
This article is excerpted from the OECD policy paper: Nature-based solutions for adapting to water-related climate risks