Abstract

This paper examines the inter-linkages between the water and energy sectors and their planning processes, by describing a comprehensive analytical tool developed to evaluate water energy nexus operational cost trends and planning to assist decision makers in exploring and evaluating alternative courses of action. Brazil has been chosen as a case study, because its electricity production is highly dependent on water to keep affordable tariffs, which in turn also serves as input to other important sectors, such as water services and sanitation, and raises disputes especially in basins marked by water scarcity, such as the São Francisco basin. In light of hydrological factors (e.g., droughts) and non-hydrological factors (e.g., chronic delays in delivery of new plants) there has been water availability constraints for electricity generation and energy prices have risen, while water quantity and quality have decreased for multiple users. Both of which impact negatively on water services and sanitation providers, because electricity figures as their fastest growing costs in times when they need more energy to source water from longer distances, or deeper levels because of water quantity and quality issues. Energy and water are characterized as common pool resources with planning processes along silos in Brazil that do not serve well the purpose of sustainable development. Better integrated water-energy plans at basin level is the alternative proposed under this paper to advance sustainability and mitigate the risks related to water scarcity that have resulted in negative impacts on both electricity and water sectors.