HomeFeatures/AnalysisInterview with Diego J. Rodriguez, The World Bank

Interview with Diego J. Rodriguez, The World Bank

“The World Bank’s Thirsty Energy initiative:  Will water constrain our energy future?”

Diego RodriguezExclusive interview with Diego J. Rodriguez, Senior Economist, Water Unit, The World Bank.  Diego is a panelist in the Water-Energy-Food nexus panel dialogue during the water track at the upcoming African Utility Week in Cape Town on 13 May.  He will unpack the World Bank’s global initiative: Thirsty Energy.

Could you briefly give us some general background about the Thirsty Energy Initiative by the World Bank?
We officially launched Thirsty Energy at the World Future Energy Summit in Abu Dhabi in January this year. The process to develop it as a global initiative took some time as we needed to ensure that we had a good understanding of the main challenges. What we found is that we still lack a thorough understanding of energy in the water sector and vice versa.

Our entry point is the energy sector, which is rather unconventional; Thirsty Energy aims to address and tackle the strong interlinkages from the energy rather than a water perspective. As such, the initiative needs to work initially with the energy community and then bring the water community to ensure that we develop integrated planning and integrated investment solutions. Hence, we decided to launch Thirsty Energy in a large and global energy event.

To further characterize Thirsty Energy as a global initiative with various components – advisory and technical services and support, awareness-raising, capacity-building and others – it might also be interesting to mention the main question we keep asking and using: Will water constrain our energy future?

Thirsty Energy aims to break disciplinary silos that prevent cross-sectoral planning and learning and to ensure sustainable resource development for future generations.

How serious is the situation already? Could you give us some data and facts that can explain it?
This is a situation that is already very present in many parts of the world. In the United States, power plants have already shut down or reduced electricity generation due to low water flows or high water temperatures and licenses for new plants have been revoked or delayed due to lack of water availability; in the North-East of Brazil, a drought led to eight months of power rationing; in India, power plants have shut down for days due to lack of water; in France and the United States nuclear plants have had to shut down due to increasing water temperatures. And there are many more examples from all world regions which we aim to show and use to sensitize on the increasing necessity to address the energy-water interdependencies.

At the same time, it is important to say that electricity generation will increase rapidly within the next decades, specifically in the developing world and emerging economies. Some are already experiencing water and energy security challenges: recent estimates show that emerging economies like China, India and Brazil will double their energy consumption in the next forty years; Africa’s electricity generation will be seven times as high as it is presently by 2050 while, in Asia, primary energy production will almost double and electricity generation will more than triple by the same year.

As a result of the huge water usage of the power sector, water demand will also increase and put pressure on the entire water sector as demand from agriculture, industry, and water supply for human consumption will also be increasing. So some countries and world regions are already facing energy-water problems –  Thirsty Energy aims to raise awareness that those interdependent challenges will increase dramatically in the decades to come and that we must understand tradeoffs across all competing areas.

We invite readers to browse through our infographics that we prepared recently to illustrate all of these challenges and opportunities.

(Click here: http://www.worldbank.org/en/news/feature/2014/01/16/infographic-thirsty-energy-energy-and-water-interdependence)

Are there any specific water-energy challenges in Africa? Can you describe them?
There are water-energy challenges in most regions of the world. But these challenges are very context and location specific. In general, we see challenges in areas in which there is already competition for existing water resources and dry and water stress areas. If we look at North Africa, we see semiarid countries with many areas already facing water stress and a highly variable precipitation rate due to its geographic and climatic conditions. Moreover, the effects of climate change could exacerbate the problem in the future.

Climate historical data on rainfall amounts on the region show a negative trend at national and regional scales. Therefore, even already planned water demands by new power plants, might be under additional risk and uncertainty due to the possible changes in water availability in the future. These effects can also be perceived in countries like South Africa and also in many countries in the continent that are highly dependent on hydropower as water scarcity will also have an impact on the existing capacity in the near future, affecting its availability and uncertain reliability.

You already mentioned that you have started work in South Africa – can you describe this in more detail?
In South Africa we started a collaboration effort with the Energy Research Center of the University of Cape Town to support existing energy modeling tools to incorporate water constraints on energy development to reflect the real cost of allocating water to the power sector and work to integrate water considerations into energy planning frameworks.

We will look at different scenarios and, based on the results and as a second phase, we will look at the economy-wide impacts of those scenarios to have a good understanding of the tradeoffs and monetize economic impacts of different water allocation schemes. We are also planning to showcase the existing knowledge of South Africa by addressing water scarcity in the power sector – such as the implementation of dry cooling versus wet cooling – and to foster south-to-south knowledge exchange.

What surprises you about the work that you do?
The work on this initiative has really shown the complexities of going from a global discourse to actual implementation on the ground. The global development community has been discussing extensively this nexus thinking in several regional and global fora, but actual work on the ground is very limited in the developing countries. It is clear that the proposed approach can really impact the way that energy and water have been – and will be – planned and how investments have been and will be designed; it is very fulfilling to see that we can actually make a difference with this new approach and initiative in many parts of the world.

What will be your specific messages at African Utility Week?
It is important to say that Thirsty Energy is a demand-driven initiative, not a top-down approach. By this we mean that we must ensure that our client countries and governments are the ones demanding support in order to address interdependent energy and water challenges in a more integrated approach.

Thus we hope to make more African governments aware of the interdependencies and foreseeable pressure on water as a resource for energy generation. The World Bank is ready to assist client countries which seek to find and identify appropriate integrated approaches in order to anticipate water constraints in energy investments, and prevent risks to energy projects and their long-term energy planning.

Thirsty Energy has also established a Private Sector Reference Group (PSRG) to share experience, to provide technical and policy advice, and to scale-up outreach efforts. Abengoa, Alstom, Veolia and EDF are already partnering with the initiative. The World Bank hopes that together with these partners, and others who come on board, the efforts of Thirsty Energy can be magnified and both energy and water resources, will be better managed for a more sustainable future.

What are you most looking forward to at the event?
African Utility Week provides an invaluable opportunity to present our initiative to water and energy utilities. These are the institutions with the responsibility of planning and investing to ensure water and energy security. The event provides an ideal platform to present our existing knowledge on the water-energy nexus, to raise awareness, and welcome new partners to the initiative. The energy-water nexus is a very complex issue and it cannot be tackled by a small group of organizations; it requires strong multi-disciplinary teams, multi-stakeholder collaboration and global knowledge sharing.

Find out more on: www.worldbank.org/thirstyenergy