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With its demand for energy increasing exponentially, the Asia-Pacific region faces major supply challenges. Coal, the most prevalent energy product within the region, will continue to be the main source of energy, despite serious concerns about water quality degradation as an effect of coal mining and the water quantity required for cooling thermal power plants. The potential for Asia to develop into a significant market for and exporter of biofuels is being increasingly recognized, and there is a hope that it will provide new employment opportunities in several developing nations. In the Arab region, the low to middle income countries are struggling to meet growing demands for water and energy services. Limited understanding of the interdependencies affecting the management of water and energy resources has stymied coordination between water and energy policy-makers, and limited coordination between the water, energy, electricity and agriculture sectors has led to conflicting policies and development objectives. Solar- driven desalination and energy recovery from wastewater are two promising technologies particularly well suited to the region. In Latin America and the Caribbean, there is an increasing interest in biofuels and in how more water efficient (and more energy intensive) irrigation methods and electricity subsidies to farmers impact on aquifer sustainability. The vast majority of water utilities in the region are struggling to attain self-financing and, as energy is often the greatest component (30–40%) of operational costs, increasing energy costs have direct implications for service affordability and for sector financing. The majority of the rural population in sub-Saharan Africa relies on traditional energy supplies, mainly unprocessed biomass, the burning of which causes significant pollution and health concerns. It is the only region in the world where the absolute number of people without access to electricity is increasing. As Africa has not yet tapped in to its rich potential for hydropower development to a substantial degree, it has the opportunity of learning from the positive as well as the negative aspects of hydropower implementation practices that other nations have undergone. Enabling environments Recognition of the interconnectedness between water and energy has led some observers to call for a greater level of integration of the two domains. Although this may be possible and beneficial under certain circumstances, an increased level of collaboration and coordination would create favourable outcomes in nearly all situations. Effective collaboration does not necessarily require that responsibilities for water and energy are combined into the same institutional portfolio, nor does doing so assure coherent cooperation. Water and energy practitioners need to engage with and fully understand one another. Both domains have been traditionally expected to focus on a narrow mandate in meeting their own aims and fulfilling their own targeted responsibilities. There is often little or no incentive to initiate and pursue coordination or integration of policies across sectoral institutions. Policy-makers, planners and practitioners in water and energy need to take steps to identify and overcome the barriers that exist between their domains. The most common responses to the dilemmas, risks and opportunities presented in this fifth edition of the United Nations World Water Development Report are related to improving the efficiency and sustainability with which water and energy are used and finding win–win options that create savings of both, which can become mutually reinforcing (creating synergy). But not every situation offers such opportunities. There are situations in which competition for resources can arise or there is genuine conflict between water and energy aims, meaning some degree of trade-off will be necessary. Dealing with trade-offs may require and benefit from negotiation, especially where international issues are involved. Where competition between different resource domains is likely to increase, the requirement to make deliberate trade- offs arises and these trade-offs will need to be managed and contained, preferably through collaboration and in a coordinated manner. To do this, better (and sometimes new) data are required. The incentives to increase efficiency facing the two domains are asymmetrical: energy users have little or no incentive to conserve water due to zero or low prices, but water users normally do pay for energy, even though prices may be subsidized. Water and energy prices are strongly affected by political decisions and subsidies that support major sectors such as agriculture and industry, and these subsidies often distort the true economic relationship between water and energy. Particularly for water, price is rarely a true reflection of cost – it is often even less than the cost of supply. 6 EXECUTIVE SUMMARYPDF Image | Water and Energy
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