State Programme for Water

Resources Management and

Kazakhstan’s Transition

to Green Economy

Август 203 г.

Annual Meeting of EUWI EECCA Working Group - Geneva, 24 June 2014 -

Mukhtar Zhakenov,

Deputy Director, Water and Biological Resources Department

Ministry of Environment and Water Resources of the Republic of

Kazakhstan

Concept for Transition of the Republic of

Kazakhstan to Green Economy

• Approved by Decree of the President of the Republic of Kazakhstan No.

577 of 30 May 2013 as a tool to ensure sustainable development of the

country

• Green Economy (GE) is defined as that with high living standards for the

population and environmentally-friendly and efficient use of natural

resources

• Seven key areas for transition to green economy: 1. Sustainable use of water resources

2. Sustainable and productive agriculture

3. Energy saving and enhanced energy efficiency

4. Development of electric power sector, increasing the share of renewable energy

5. Sustainable waste management

6. Air pollution abatement

7. Conservation and efficient management of ecosystems

• Establishment of the national Council for Transition to Green Economy

(chaired by the Prime-Minister of the Republic of Kazakhstan) 1

2

Water stress in Kazakhstan: by 2040, deficit will amount to about 12

bn m3 and will become a major impediment to future growth

Bn m3 a year

Country-level water supply and demand

2020 2030 2040

Economic demand for

water resources

Sustainable, available,

reliable resources

Available and sustainable resources could be used to satisfy economic demand without risk for environment and regardless of climate change

Decrease in transboundary rivers flow is expected

3

2012

Water stress …

Source: Water Resources Committee – General Chart, UNDP, Charting Our Water Future (2010), analysis performed by a working group.

Water stress has been growing and it might become a major limitation for economic development (opportunity cost is expected to amount to USD 7-8 bn a year) and an environmental threat if no drastic measures are taken to enhance water use efficiency and increase water supply volumes

16

4

19

5

22

25

2

4

6

6

12

18

13

3

5

~12

7

20

23

21

In the baseline scenario, economic demand for water resources will increase by 1.6% a year

The increase in demand reflects an increase by 50% in irrigation and increase in water use by housing and utility services sector and industry

1

Possible resources2

1 Difference between two scenarios: а) countries limit increase in water use as per agreements and 2) countries use amounts above standards. Glacier runoff stability has been called into question; water availability could go down considerably in 2040.

Accelerated melting of glaciers caused by climate change has become an additional source of water supply since early 1980s

Such unforeseen “one-off” source is not renewable, and its volume might decrease by 2040

2

Additional resources from

transboundary rivers1

3

Water consumption will go up by 56% by 2040 in baseline scenario

if no measures to enhance water use efficiency are taken

Water Use Increase Rate1

Bn m3 a year

Water Use in the Housing and Utility Services Sector

Increase in water consumption given average annual population growth by 1%

Share of urban population will go up to 73% which will result in increase by 35% of water consumption by population

Water Use by Industrial Sector

Water use by industrial sector will go up by 35% by 2040 in response to increase in output by 4% a year

The largest increase in water consumption is expected in oil and gas production and processing sector, mining sector, transport, and electric power generation

Water Use by Agriculture

Water use by agriculture will grow due to increase in total irrigated areas to 2.1 mln ha by 2040

CAGR

1.6%

1.1%

1.9%

1,9

2,1

2,4

2,6

0,6

0,5

+1.6% a year

2040

24.6

21,1

0,9

2030

21.8

18,6

0,8

2020

18.8

16,0

2012

15.8

13,4

4

Projected water deficit could be reduced by 9.5 bn m3 by improving

water use efficiency and renovating water infrastructure

3,4

2,5

2,8

1,6

1,1

National infrastructure development (megaprojects)

Review of agricultural crops range

Soil irrigation and cultivation efficiency

Retrofitting irrigation systems

Efficient use in the housing and utility services sector and by industries

12,2

Retrofitting canals and water mains

Total deficit

12.2

0,8

~890 ~416 ~1171 Capital expenditure, bn KZT

~800-900 ~718

Water saving, bn m3 per year

Retrofitting ▪ canals ▪ water

reservoirs ▪ water mains

▪ Retrofitting irrigation systems

▪ Drip irrigation ▪ Sprinkling ▪ Boardless

cultivation

▪ Retrofitting networks, pumping stations, drinking water treatment systems

Main activities

5

All three key user groups could potentially reduce losses and

enhance water use efficiency

Current level of losses

Minimal technical losses

Water supply sources

Mains

Distribution canals

Pipes

Water-using utilities

Water-using industries

Agricultural users

Irrigation systems

11%

5%

40%*

5%*

25%*

10%*

20%

10%

10%

5%

30%

10%

45%

15%

Total Losses, percent

Minimal Technical Losses, percent User Type

Agriculture

Industry

Utility services sector

66 27

40 19

58 19

* For municipal and industrial users, “home-stretch” losses include inefficient water use

Total Capacity, km3 a year

11,2

0,9

0,3

6

Poor quality of infrastructure requires additional investment

Distribution canals (communal property and ownerless infrastructure)

7,9

Water mains (owned by the republic)

11,1 40

38

Canal length 1,000 km

Canals in unsatisfactory condition, in percent

Length and condition of canals

40% of water supplying infrastructure requires retrofitting worth about KZT 925 bn (USD 6.2 bn)

Transferring the infrastructure into management by proposed national operators or external companies should be considered so that facilities and canals are maintained in a satisfactory condition

No coating, in percent

56

27

Total cost, KZT bn

260

665

7

Required investment in drinking water supply and municipal wastewater

treatment infrastructure

Total investment, 2014-2040, KZT tln

Total investment in WSS

Rehabilitation of wastewater treatment infrastructure

Extension of wastewater treatment infrastructure

Total investment in wastewater treatment –related infrastructure

Extension of infrastructure to get drinking water

Total investment in drinking water-related infrastructure

Rehabilitation of infrastructure to get drinking water

Drinking water Wastewater

Key assumptions and targets

100-percent coverage of urban population by water supply and wastewater treatment by 2020

Rural population coverage by water supply at 80% and by wastewater treatment by 20% by 2020 (coverage by water supply at 100% and by wastewater treatment by 50% in 2040)

60% of water supply facilities and 70% of wastewater treatment facilities should be retrofitted

0.261

0.713 0.811

3.613

2.541

2.802 0.98

Sustainable Use of Water Resources

Thus, limited water resources and expected water stress could become a major impediment to

future growth in Kazakhstan

The Concept for transition to GE provides for measures and mechanisms to:

А) Reduce water stress:

- Water saving in agriculture which currently uses 2/3 of abstracted water (will use 6.5-7 bn

m3 by 2030)

- Enhancing water use efficiency in the industrial sector (by 25%) and in the community

amenities sector (by 10%), meaning water saving at some 1.5-2 bn m3 and 100 mln m3 a

year, respectively, by 2030

B) Enhance availability and reliability of water supply (by 4.5-5 km3 a year):

- Improving the sharing & allocation of transboundary rivers flow (negotiations, agreements)

- Constructing water reservoirs to manage the flow

- Sustainable use of ground water resources

- Rehabilitation and development of irrigation mains, water supply from water-abundant to

water-scarce regions in the country

- Water resources pollution abatement & control

C) Improve water resources policy and management framework nationally and at basin level:

- Water use limits, water prices and tariffs, new requirements and standards, etc.

- Development of the State Water Resources Management Programme until 2040 with

clear goals, objectives, implementation stages, and financing

8

State Programme for Water Resources Management

in Kazakhstan

Approved by Decree of the President of the Republic of Kazakhstan No. 786 of 4

April 2014 as a tool to address the above challenges and issues

The Programme’s main goal is to ensure water security to Kazakhstan by

enhancing water resources management efficiency

Goals:

1. Secure water supply to the population, environment, and economic sectors

through water saving measures and by increasing the amount of available water

resources

2. Enhance water resources management efficiency

3. Ensure conservation and protection of aquatic ecosystems

Sources and amounts of financing

• Estimated amounts in 2014-2040: KZT 8.2 tln, of which KZT 5.4 tln from the

republican and local budgets and KZT 2.8 tln out of extrabudgetary funds.

• Estimated amounts of financing from the republican and local budgets until 2020 are

KZT 3.3 tln and they will be adjusted as budgets are drawn up for the period concerned

9

Programme Targets

Targets (by 2020):

1. Reduce water use per unit of real GDP by 33% versus 2012 level

2. Ensure additional surface water resources (some 0.6 km3 )

3. Share of households and other water users with permanent access to

centralized drinking water supply systems is at least 100% in urban areas and at

least 80% in rural settlements

4. Share of water users with access to sanitation systems is at least 100% in urban

areas and at least 20% in rural settlements

5. Satisfy the annual water demand of 39 km3 for maintaining ecosystems

(environmental flow) and navigation

Respective targets by 2040 have also been set

10

11

Changes in Water Sector Management in Kazakhstan to Enhance

Efficiency, Consistent with Best International Practices

To-date State Programme for WRM

MoEnv&WR

▪ State water policy making

▪ Transboundary negotiations

▪ Water resources control and regulation

WRC

▪ Infrastructure planning, construction

and management

National water companies

WR Committee

▪ State water policy making

▪ Transboundary

negotiations

▪ Water resources control

and regulation

▪ Infrastructure construction

12

The State Programme’s Key Management Decisions and

Economic Tools

▪ Establish an inter-agency Council to coordinate water resources management

▪ Strengthen the functions and powers of basin inspectorates

▪ Set up two national companies for water infrastructure management

▪ Set up a full-fledged water department or water institute in a University, and respective training programmes

▪ Identify and eliminate subsidies impeding enhancement of water use efficiency, especially in agriculture

▪ Increase tariffs for all user categories to encourage efficient water use and recover investment in system renovation

Implementation of the State Programme will be a major contribution to the

implementation of Kazakhstan’s Development Strategy and transition to Green Economy

Thank you!