Environmental impact

The environmental impacts of schemes to supply, use and dispose of water are potentially very large. Dams and reservoirs, aqueducts, river diversions, major irrigation schemes, industrial and municipal offtake, groundwater pumping, etc. can have a massive hydrological impact affecting other users, future generations, amenity and wildlife. Likewise the disposal of wastewater and the contamination of freshwater bodies through agricultural runoff, industrial effluent and unprocessed sewage.

Where possible, these environmental effects should be included in the course of project appraisal. Environmental effects should be factored into the economic appraisal, either as costs or credits, using recognized techniques (Dixon et al., 1988; Winpenny, 1991). In practice, only certain effects can be quantified, and even those only partially and imperfectly. The environmental effects of policies may also be difficult to capture in numbers, though they should be rigorously tracked using recognized checklists, such as the Environmental Assessment Sourcebook (World Bank, 1991).

Environmental criteria apply with particular severity to large new schemes for water supply development. Less obviously, non-physical projects, such as new policies and programmes, including structural adjustment and sectorial reform, also may have significant impact on the environment. Demand-management measures, such as conservation, are much more environmentally benign, avoiding the major impact of supply projects and reducing costs resulting from pollution.