Socioeconomic importance of water in the Alps

1
Socio-economic importance of water in the Alps

• Thomas Egger
• Director of the Swiss center for mountain regions
  (SAB)
• Observer at the Alpine Convention for Euromontana
• Seilerstrasse 4, 3001 Bern

2
Water in the Alpine Convention

• Protocol on spatial planning, art. 11 Use of
  resources, services of general interest, natural
  handicaps ad restrictions to the use of
  resourcesThe contracting parties will evaluate
  in the context of their legal framework to what
  extend a) the users of alpine resources have to
  pay market orientated prices, which integrate the
  economic value for the delivery of those
  resources b) services of general interest can be
  remunerated. (...)
• Protocol on energy, art. 7 Hydropower (...) 5.
  The Contracting Parties may, in the framework of
  their national legislation, examine how they can
  make end-consumers of Alpine resources pay
  market-related prices, and the extent to which
  the local population can be fairly compensated
  for services supplied in the general interest.

3
The Alps - Energy supplier for Europe

• Country Installed power in the Alps In of nat.
  electr. prod.
• CH 9900 MW 64
• AT 8600 MW 58
• IT 9500 MW 16
• FR 7300 MW 7
• SL 4000 MW 20
• DE 500 MW 0,5
• (Source Werner Bätzing, Kleines Alpen-Lexikon
  1997)
• Example Southern Tyrol (2005) Example
  Graubünden
• Hydropower production 4835 Mio. kWh 7800 Mio.
  kWh
• Own consumption 2666 Mio. kWh 2000 Mio. kWh
• Export 2169 Mio. kWh 5800 Mio. kWh (75)

4
Paying the right price for the use of water
resources

• Water can be considered as a positive
  externality-gt Hydropower use-gt Use as drinking
  water-gt Natural value
• Water Fee (Wasserzins) in alpine countriesCH
  Wasserzins of 80 Fr. / kW installed brut power
  (ca. 50 Euros)DE Nutzungsgebühr in Bavaria of
  3,5 to 7 Euro per kWFR Redevance fixe and
  redevance proportionelleIT Canone daqua of
  0,012 Euro / kWh produced AT SL (Source
  Hans Wyer, Die öffentlichen Abgaben der
  Wasserkraftnutzung im Alpenraum, 2006)
• Price for drinking water
• In Switzerland, around 530 Mio. Liters of
  mineral water are filled into bottles each year.
  The city of Friburg has its drinking water for
  free from the alpine Hinterland.

5
Socio economic importance of water for mountain
areas (1)

• Water Fee in Switzerland - Important source of
  Income for mountain cantons
• Canton Revenue from water feeGL 9,3 Mio.
  Fr.
• GR 87,4 Mio. Fr.
• NW 1,2 Mio. Fr.
• OW 3,0 Mio. Fr.
• TI 40,4 Mio. Fr. UR 19,3 Mio. Fr.
• VS 108,1 Mio. Fr.
• Total 268,7 Mio. Fr.

6
Socio economic importance of water for mountain
areas (2)

• Water Fee in Switzerland Important source of
  income for mountain municipalities (example
  Graubünden, CH)

7
Who owns hydropower plants?

• Property structure of hydropower plants in
  Graubünden (CH)only 17 are owned by
  localauthorities

Yearly benefit of big Swiss electricity
producers in Mio. CHF Company 1997 2004 2006 ATEL
172 341 899 Axpo/NOK 49 523 1058 BKW 25 218 3
33 EOS 32 55 RE 20 118 75 Total gt286 1232 24
20
8
Commmentary to the 2nd report on the state of the
Alps

• Positive Chapter on socio-economic effects
• Negative - Positive externalities not
  recognised- Importance of paying the right price
  for water (hydropower and drinking water) not
  identified- Role of the Alps as Energy producers
  for Europe neglected- Property rights who owns
  hydropower plants and where do the revenues go
  to? -gt discussion urban - rural partnership not
  discussed in the report
• Conclusion The report does not identify the
  real challenges and opportunities for mountain
  areas and has to be amended. The report could be
  an opportunity to launch a debate on the right
  price for the use of resources in the alpine area
  (-gtexchange of experiences!)