Living in a bubble: potential gains from flexible water management policies

ABSTRACT

We study Swedish implementation of the European Union’s Water Framework Directive, and compare the current implementation strategy with more flexible ‘bubble’ schemes, where measures can be traded among various locations within the same river system to reach the overall environmental target. Two different Swedish river systems, the Mörrum system with small-scale hydropower plants, and the Ångerman system with larger plants, are studied. We find that the environmental benefits that current policies are likely to accomplish could be achieved at well under half the cost in the Mörrum system, and at less than a tenth of the cost in the Ångerman system.

KEYWORDS:

• Water framework directive
• Sweden
• hydropower
• ecological connectivity

JEL CLASSIFICATION:

• Q22
• Q25
• Q28

Acknowledgements

Funding from Energiforsk, as well as from the R&D programme Kraft och liv i vatten (KLIV) supported by several hydropower companies in Sweden, the Swedish Energy Agency, the Swedish Agency for Marine and Water Management and Sweden’s water authorities, is gratefully acknowledged. Researchers at ÅF Hydropower, especially Peter Bergsten, and staff at Uniper, especially Åke Henriksson and Johan Tielman, are thanked for providing data and for help with biological and hydrological estimates. Constructive comments from seminar and conference participants and from an anonymous reviewer are also gratefully acknowledged. Sandie Fitchat provided valuable help with language editing. The usual disclaimers apply.

Disclosure statement

No potential conflict of interest was reported by the author.

Additional information

Funding

Funding from Energiforsk, as well as from the R&D programme Kraft och liv i vatten (KLIV) supported by several hydropower companies in Sweden, the Swedish Energy Agency, the Swedish Agency for Marine and Water Management and Sweden’s water authorities, is gratefully acknowledged.