# EUR-Lex - 52012DC0672 - EN

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# 52012DC0672

**COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Report on the Review of the European Water Scarcity and Droughts Policy /* COM/2012/0672 final */**

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COMMUNICATION FROM THE COMMISSION TO
THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL
COMMITTEE AND THE COMMITTEE OF THE REGIONS

Report on the
Review of the European Water Scarcity and Droughts Policy

1.           Introduction

Over the past decade, the concerns about
drought events and water scarcity have grown within the EU, especially with
regard to long-term imbalances of water demand and water availability in
Europe.

Following one of the most widespread
droughts in 2003 affecting over 100 million people, a third of the EU
territory, with a cost of at least € 8.7 billion, the
EU Council of Ministers asked the European Commission to address the challenges
of water scarcity and droughts (WS&D) in the EU.

The Commission responded to this call in
the Communication on water scarcity & droughts in the European Union[1],
which laid down a water hierarchy under which water demand management should
come first, and alternative supply options only once the potential for water
efficiency has been exhausted. The Communication identified 7 main policy
options to address the WS&D challenges. Each of these is assessed in
sections 3.1.1 - 3.1.7 below.

The Commission has assessed progress in
implementing these policy options in annual follow-up reports in 2008, 2009 and
2010. This report responds to the 2007 Council request to review by 2012
whether the policy on water scarcity and droughts has achieved its objectives
of reducing water scarcity and vulnerability to droughts. It also looks into
whether action taken in the implementation of the Water
Framework Directive (WFD)[2]
has contributed to addressing WS&D. This assessment
is based on a number of studies[3]
launched by the European Commission and on the assessment of the Member States
river basin management plans (RBMPs). It is one of the pillars supporting the
development of the Blueprint to Safeguard Europe's Water Resources. Further
details can be found in the annexed Commission Staff Working Document.

2.           Water
scarcity and Droughts in Europe

In 2011 and 2012 droughts affected large
parts of Southern, Western and even Northern Europe. The 2011 drought has been
referred to as the worst in a century with rainfall as
low as 40 percent of normal. In both years water
availability was significantly reduced in the spring
and water use restrictions were put in place in large parts of the EU. Over the past thirty years, droughts have dramatically increased in
number and impact. Between 1976 and 2006 the number of areas and people
affected by droughts went up by almost 20% and the total costs of droughts amounted to 100 billion €.

In 2007 at least 11% of the EU population
and 17% of its territory had experienced water scarcity and the phenomena is getting
worse; currently an important share of river basins can
be considered as under water stress all year round. During summer months water
scarcity is more pronounced in Southern Europe but is also becoming
increasingly important in Northern basins, including UK and Germany.

Trends appear to remain stable. A modeled
localization of water scarce basins in summer and all year round in 2030 shows
that the number of river basins under water scarcity are
expected to increase by up to 50% [4].

Both droughts and water scarcity can cause
economic losses in key water-using sectors and environmental impacts on
biodiversity, water quality, deterioration and loss of wetlands, soil erosion, land
degradation and desertification. Some of the effects are short-term and
conditions quickly return to normal whilst other effects may become permanent.

3.           Water
Scarcity and Droughts Policy in Europe

The policy
instruments identified in the 2007 Communication and the WFD are both important
tools to revert the trends of water scarcity and the vulnerability to droughts
in the EU. The following sections show the extent to which this has happened to
date and identify the gaps in the current WS&D policy.

3.1.        Implementation
of the 2007 policy options

3.1.1.     Putting the right price tag on water

Limited implementation
of the cost-recovery and incentive pricing requirements of the WFD has taken
place. RBMPs provide information on current tariffs for water services, where
the definition of water services is often not in line with the Commissions
interpretation as it limits their scope to the provision of drinking water and
waste water treatment excluding self-abstraction, flood protection, hydropower,
navigation etc.[5]
Even when a broader definition
of water services is used, recovery of financial costs
for water services is not yet the norm in all Member States and environmental
or resource costs are often not considered.

If water tariffs are set below cost
recovery levels, the degree of asset replacement of drinking water systems may
not be sufficient to reduce leakage to a sustainable level and funds available
for treatment may not be sufficient to achieve environmental objectives[6].

In agriculture, the biggest consumptive
sector for water in the EU, operational costs for the provision of water are
only partly recovered for 10 Member States and capital costs are often subsidized.
An important share of water abstractions for agriculture in the EU is not
priced, even in water stressed areas, and there is no financial mechanism for
recovering the environmental and resource costs of individual abstractions or
for giving incentives to using water more efficiently. Metering is a
pre-condition for effective water allocation and pricing[7].

3.1.2.     Allocating water and water-related funding more efficiently

Authorization procedures for water
abstraction or use are generally in place in all Member States, but procedures
differ significantly and illegal abstractions remain an important challenge in
parts of Europe. The practice to restrict water use in times of water scarcity
or drought is included in many Member States' water allocation policies.

In some Member States, restrictions are
determined according to a hierarchy of water users, under which the environment
is sometimes being included as a separate sector. Abstraction rules are
sometimes more stringent in areas suffering from chronic water shortage.

Ecological flow schemes[8] are increasingly used as an
element of water allocation to
restrict water use, to define the maximum limits of changes to the water
bodies, to maintain a certain biological condition and to help correct impacts
of earlier action.

In Europe, Spain is the only country where,
since 1999, trading water use rights has been possible and since 2005, water
markets emerged with a diversity of informal and formal trading mechanisms. During
the 2005-2008 drought in Spain, water market exchanges alleviated the
conditions of those basins where water scarcity was most severe.

Progress has been made in
integrating water quantity aspects into the Common Agriculture Policy (CAP),
and the provisions of the Commission's proposals for the CAP to include the WFD
in cross compliance and to establish conditionalities for the use of rural
development funds for irrigation projects are crucial for this trend to
continue. The Commission's proposal for 2014-2020 has
set efficient water supply and water demand management as key actions of the
ERDF and Cohesion Fund investments into water management. Meanwhile, a
Communication[9] has reminded Member
States about the need to increase the support for water efficiency when using
cohesion policy funding. The use of EIB funds for Member States actions to
address WS&D is still low.

Adapting land use to reduce the
vulnerability of water resources is not common at Member States level and
highly fragmented support actions and technical measures are promoted instead
of integrated land and water use planning.

Cost-effectiveness and cost-benefit
analysis has seldom been used by Member States to prioritize investments under
the RBMP process; hence the process has not fully provided a coordination
mechanism for allocating financial resources to priority issues6.

3.1.3.     Improving drought risk management

The development of Drought Management Plans
has progressed but their implementation as well as their integration with RBMPs
and other planning documents remains limited. Some
measures in the RBMPs aim at reducing water abstraction from different sectors,
and can contribute to reducing vulnerability to drought; however they are
mainly focussing on addressing water scarcity.

A prototype of the European Drought
Observatory (EDO) has been developed and interoperability arrangements have
been established with key data centers at European, regional and local level. EU wide drought indicators are now available on a preliminary basis
for precipitation, soil moisture, vegetation response and a combined drought
indicator targeted to agricultural drought. Further developments are required
to test and improve the indicator set, to add further data from national and
river basin level, to test and implement medium to long range drought
forecasting and to perform hazard and risk analysis.

Limited progress has been made with the use
of EU Solidarity Funds in the
area of droughts. The financing mechanism was activated once only for the 2008
Drought in Cyprus Application rules are currently being revised.

3.1.4.     Considering additional water supply infrastructures

In some Member States, additional water
supply infrastructures have been developed before exploiting the full potential
of water saving measures, thus in spite of the water hierarchy. The potential environmental impacts of new water supply
infrastructure plans have not been systematically considered by Member States.

In approximately 30% of the screened RBMPs,
the development or upgrade of reservoirs and other water infrastructure is
foreseen to increase the water availability and reduce socio-economic impacts
of reduced water availability.

25% of RBMPs include the development or
upgrade of water transfer schemes, but with different
degrees of relevance, wastewater re-use is included in
50% and artificial aquifer recharge and rainwater harvesting in 30% of the
RBMPs.

The development or upgrade of
desalinization plants is only presented in a few RBMPs but is of high
importance for River Basins in Southern Europe. Adverse environmental effects
of desalination are not always sufficiently considered in the plans.

3.1.5.     Fostering water efficient technologies and practices

Although substantial water efficiency gains
have been achieved in irrigated agriculture, improving irrigation schedules and
modernizing technologies can still provide significant water savings.
Uncertainty remains however on how water saving at the field level is
effectively translated into overall water saving at the farm and river basin
level. In some cases, modernization has led to intensification or more area
being cultivated rather than a decrease in water use[10]. Efficiency margins are still
significant in building, e.g. in relation to eco-design of taps and shower heads.

In the EU there is a large diversity of the
efficiency of drinking water supply systems. In some cases, water distribution
systems with low water efficiency (high leakage rates) can be at their optimal
economic efficiency level, meaning that additional
investments in leakage reduction would result in increased costs to the public
but would not result in additional benefits to either the public or the
environment6.

The assessment of the RBMPs shows that they
often have not been adequately coordinated with other physical and
socio-economic plans e.g. on land use. This lack of coordination, together with
the absence of supporting financing plans, severely hinders the implementation
of the RBMPs in general and of measures relevant to WS&D (including water
efficiency measures) in particular.

3.1.6.     Fostering the emergence of a water-saving culture in Europe

Member States are implementing a broad
spectrum of awareness raising activities to foster water saving, but other
tools such as incentive pricing, financing mechanisms for water saving eco-design
for water using appliances etc are not always sufficiently present.

In the area of sustainable consumption, two
main trends regarding food and agricultural product certification and labeling
schemes are emerging: schemes with a focus on providing information on the
water footprint of a product and schemes that are focused on encouraging good
water stewardship. Labeling on the basis of a water footprint is not currently recommended
as most consumers would not have sufficient knowledge to interpret the information
and given the unresolved issues on transparency and reliability of data
underlying the footprint and its failure to address impacts of the consumed
water[11].

The European Water Partnership has
developed the European Water Stewardship (EWS) scheme with the aim to promote
efficient practices by key water users. Criteria for certification are closely
linked with the main WFD requirements and the EWS can therefore be a useful
tool to optimise water management at RB level.

3.1.7.     Improving knowledge and data collection

EU wide coverage and long-time series of
water quantity data are not yet available therefore,
the basic step of identifying water scarce river basins remains a challenge. Streamlined
data on state and pressures, impacts and effectiveness of responses to address
WS&D still need improvement.

Progress towards the application of common
WS&D indicators has been made under the Common Implementation Strategy for
the WFD. Three indicators have been agreed so far:

·
The Standardized Precipitation Index for
meteorological drought

·
The fraction of Absorbed Photosynthetically
Active Solar Radiation (fAPAR) for drought impacts on vegetation.

·
The Water Exploitation Index Plus (WEI+) for the
pressure on the water resources from water abstractions

These indicators can be calculated on the
basis of information, either already available or under development (e.g. physical water balances being developed by
the EEA).

Water scarcity and water use efficiency research
is scattered within the 6th and 7th Framework Programmes and stronger efforts
are required to develop synergies with Member States reasearch activities
inter-alia on water savings and efficiency and to ensure appropriate coordination with policy needs. This is
gradually being implemented in recently launched projects.

3.2.        Integration
of Water Scarcity and Droughts measures in the RBMPs

A screening of how water scarcity and
droughts issues are covered by the RBMPs has been carried out for all countries
which have submitted their RBMPs (therefore excluding PT, EL, and parts of ES
and BE)[12].

WS&D are recognized as relevant issues
by RBMPs across the EU. Water scarcity is reported for the whole Mediterranean
area, and for some areas in Central, Eastern and Northern Europe. 41% of the RBMPs do not consider water scarcity as a relevant
concern. Drought is reported for a wide range of River
Basin Districts accross Europe but 40% of the RBMPs do not consider drought
relevant.

The analysis of water quantity aspects
lacks adequate foundation in many RBMPs: quantity data are insufficient and
water scarcity is often not clearly distinguished from droughts and viceversa.
Water demand scenarios are presented for only 35% and water availability
scenarios for less than 25% of the RBMPs. 80% of the plans do not asses the
uncertainty of data and 90% do not specify the sources of funds to implement
the relevant measures.

Measures to ensure the achievement of the
WFD objectives by enhancing the resilience of the ecosystems are included in
45% of the RBMPs. Only in a few basins that face water scarcity, restrictions
to new water-consuming developments are envisaged as a high priority in the
RBMPs.

The influence of other sectoral policies on
the reduction of water scarcity and the mitigation of drought effects is not
sufficiently covered: for only 12% of the RBMPs, the pressures on water
resources by the different sectors are identified.

In international basins, there is still a
major gap in dealing with water quantity in a way that reduces conflict risks
and contributes to the WFDs objectives. Only 5% of the screened international
RBMPs include co-ordinated measures for the entire international RBD to deal
with WS&D.

3.3.        Gaps
in the current Water Scarcity and Droughts policy

The above assessment shows a diversity of
inter-linked policy gaps in addressing water scarcity and droughts in Europe.
These include:

· Conceptual gaps: the understanding of the causal relationships
between drivers, pressures, states and impacts that would help identifying the
most cost-effective measures for addressing WS&D is still not sufficient.
Water scarcity and droughts are often not distinguished and indicators to
illustrate the two phenomena have so far been insufficient. The newly agreed
indicators need to be calculated for the entire EU at appropriate geographical
and time scale. This requires a coherent dataset at EU level.

· Information gaps: The RBMPs include only limited data on current and
future water demand and availability as well as on measures that target
WS&D, availability of funding and their expected impact on WS&D. The
absence of robust information hampers a proper assessment of the effectiveness
and socio-economic impacts of measures.

· Policy, governance and implementation gaps: overall, most support
actions and measures proposed by Member States to address WS&D target
pressures, state & impacts, giving priority to measures to increase water
supply. Measures that target key drivers at the origin of WS&D, or the
implementation of accompanying measures such as metering, pricing/subsidies and
restriction of water consumption are proposed in a few RBMPs only.
Responsibilities for and financing of the proposed measures is unclear. Adequate coordination with other planning processes and availability
of financial resources is not satisfactory. Finally,
the links between water scarcity and ecological flows are not well established.

4.           Tackling
water quantity issues better in the future

The main aim when dealing with WS&D is
to restore or sustain the water balance in all European river basins while
taking fully into account the water requirements of aquatic ecosystems.

While the WFD requirements on water quantity
are not spelled out in great detail for surface waters[13], Good Ecological Status is
unlikely to be reached in a water body with significantly altered flows due to
e.g. over-abstraction. Therefore adequate management of water quantity is an
implicit requirement of the WFD. A common understanding of water scarcity and
droughts has been reached in the framework of the CIS process. This needs to be
fully considered in the next RBMPs.

The European Innovation Partnership on Water[14] can play a significant role in
facilitating the development of innovative solutions to deal with water
quantity issues, while the European Innovation Partnership (EIP) on Agricultural
Productivity and Sustainability[15]
will address water management at farm level, contributing to a more efficient
use of water in agriculture. In addition, a number of
tools are important to improve water quantity management in the next RBMPs. The
main ones are highlighted here below:

4.1.        Defining
and implementing ecological flows

The establishment and enforcement of adequate
ecological flows for all water bodies in Europe is essential for dealing
efficiently with WS&D issues and to achieve Good
Ecological Status as required by the WFD as well as significant co-benefits for
energy savings, climate change mitigation and adaptation, nature and
biodiversity. It requires the adaptation of current
water allocation to consider the ecological needs of water-dependent ecosystems.
If water allocations reflect ecological flow requirements, it will be possible
to prevent or mitigate the effects of WS&D.

4.2.        Defining
and implementing targets for water efficiency

RBMPs need to include quantitative data on
water demand and availability including better
forecasting of water availability and consumption. Data should also be more
transparent, revealing uncertainties, time spans, and sources. In drought-prone
areas, drought uncertainties and variations (e.g. of the water availability)
should be considered in the RBMP’s baseline and not be interpreted as
unexpected natural climate extremes.

There is still a large potential for water
efficiency measures in all the main water using sectors: agriculture, industry,
distribution networks, buildings and energy production. But the water saving potential is very context specific and targets
are best set at local level by stakeholders who have full knowledge of the
different water use sectors and components of the hydrological cycle and who
can ensure that targets are coherent and that
efficiency measures are implemented where the socio-economic costs are the
lowest.

4.3.        Promoting
economic incentives for efficient water use

Proper implementation of the WFD article 9
is crucial for tackling WS&D. Widening the scope of current economic
instruments is necessary to ensure that they provide incentives for sustainable
water abstraction and use: where there are currently no tariffs, they need to
be put in place; consumption based water tariffs need to be promoted; the role
of abstraction charges and taxes needs to be expanded so that the environmental
and resource costs are internalised into the water users decisions.

Ensuring that economic instruments better
reflect the economic value of water will also give incentives for additional
investments in leakage control by water service providers, contributing to both
full cost recovery and the long term sustainability and efficiency of water
service provision. Finally, earmarking financial revenues for WS&D related
measures will also support achieving WS&D targets.

The establishment of water market/trading
mechanisms with a defined cap for the environment is a mechanism that can
provide the opportunity for Payment for Ecosystem Services and thereby for
achieving a sustainable balance for river basins with deficit. Incidental
benefits include the (temporary or permanent) reallocation of water use rights
among economic users that can deliver additional economic benefits.

4.4.        Guiding
land use to respond to water scarcity

Ensuring that new economic development is
coherent with the water availability is the basis for long term sustainability,
and specific attention on land use is required. This re-emphasises the need for
proper integration between RBMPs and other economic and physical planning
processes.

To ensure this, RBMPs need to be adequately
coordinated with other physical & socio-economic plans prior to adoption
and financial resources for their implementation need to be identified. This
will ensure that costs and benefits of actions are properly considered and that
the implementation of the WFD principle of cost effectiveness is used to
achieve the objectives of the RBMP at the least cost.

4.5.        Enhancing
drought management in Europe

Further development of the EDO to operate
as an early-warning system will be a necessary tool to help Member States and
economic operators to act as early as possible and prepare for forthcoming
droughts. This should be combined with an effective adaptation of the EU
Solidarity Fund in case of drought emergency to cope with damages that could
not be avoided.

Further efforts are required to develop and
implement a coherent set of actions to address drought at the river basin scale
within the planning process of the WFD. Land use developments should be
coherent with the water availability in the RBDs, including its variability. In
this respect, Green Infrastructures such as retention measures can play a very
positive role.

Moreover, alternative water supply options
with low environmental impact such as water re-use need to be further relied
upon.

4.6.        Promoting resilience to
climate change.

Climate change is expected to worsen the impacts of
already existing stresses on water as changes in precipitation, combined with
rising temperatures, will cause significant changes in the quality and
availability of water resources. A combination of adaptation measures must be
included in the policy answers to water scarcity and drought.

5.           Conclusion

The overall objective of the WS&D
policy - to revert the WS&D trends - has not been achieved, even if
progress has taken place in implementing the 7 policy
instruments identified in the Commissions Communication from 20071.

The WS&D policy has to some extent been
considered as self-standing by Member States and a stronger focus on quantity
issues in the implementation of the WFD is critical. In the next implementation
cycles of the WFD this need to be ensured along with further integration of
water quantity issues into sectoral policies.

The majority of
measures applied by Member States target pressures, state and impacts and only
very few measures target key drivers.

The identified policy gaps and concrete
options to address them are considered in the Commission Communication 'Blueprint
to Safeguard Europe's Water Resources' with a view to integrating water
quantity issues more fully into the overall policy framework. Where relevant, further policy
measures may be addressed in the Adaptation to
climate change Strategy foreseen for spring 2013.

[1]               COM (2007) 414 final

[2]               Directive 2000/60/EC, OJ L
327, 22.12.2000, p.1

[3]               http://ec.europa.eu/environment/water/quantity/building_blocks.htm

[4]                      Modelling
done under the project ClimWatAdapt.

[5]               Infringements procedures have been launched by the
Commission against 8 Member States. The on-going assessment of the Member
States' RBMPs shows that a broad definition of water services has been reported
in only 6 out of 23 Member States assessed.

[6]               Resource
and economic efficiency of water distribution networks. Final report from ERM
to the European Commission 2012

[7]               The
role of water pricing and water allocation in agriculture. Final report to from
Arcadis et al to the European Commission, 2012.

[8]                      The
flow regimes which are necessary to maintain essential processes of healthy
river ecosystems and good ecological status of water bodies

[9]               COM(2011) 17 final

[10]                    Water
saving potential in agriculture in Europe, Final Report from Bio Intelligence
Service to the European Commission, 2012

[11]             Water footprinting and product labelling, Final Report from RPA to
the European Commission, 2011

[12]             The report may consequently underestimate the WS&D
challenge in Europe

[13]             Quantity
requirements are explicit for ground water

[14]             COM(2012)216

[15]             COM(2012) 79