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Politics, Water, and Climate Change: Mismanaging Drought in Brazil

By Claudia Melim-McLeod
The problem
From 2013 to 2015, Brazil faced a severe water crisis.  The country had its worst drought in 84 years, which led 1,485 out of its 5,561 municipalities to declare a state of emergency.[2]  The drought affected over 20 million people in the São Paulo Metropolitan Area (SPMA) alone as the volume of the city’s main system of reservoirs started to decrease in mid-2013, and was depleted in the following year.  As a consequence, millions of residents, particularly the poorest, were deprived of a regular water supply for several months, due to strict water rationing imposed by the state government. The drought also had an impact on industrial output, agriculture, and public health. 
When discussing water security, most climate change studies, including the latest report by the Intergovernmental Panel on Climate Change on Water,[3] focus on the physical changes that particular locations are undergoing or the solutions necessary to address water scarcity. In the case of drought, possible adaptation interventions include water rationing, desalination plants, water reuse technologies and investments in climate-smart agriculture, etc. 
However, the vested political and economic interests that threaten water security are not frequently discussed in international climate change reports and policy circles. The São Paulo water crisis shows that it is key to understand the political nature of water security when designing successful climate change adaptation strategies. 
In São Paulo, the state governor of São Paulo blamed climate change for the water crisis and the media focused on the drought as the main reason behind water scarcity. However, a closer look at root causes of the crisis reveals that water scarcity could have been managed differently and the crisis greatly alleviated, if not avoided altogether.
There is no doubt that the crisis was triggered by a severe drought:  2014 was the driest in the history of São Paulo since metereological data started to be collected in the 1930s [4].  Low rain levels, however, were only part of the reason for the water scarcity that led to the crisis.  
Other reasons include poor natural resource management and planning and the pollution of watershed areas that have traditionally fed the city’s reservoirs.  Although these issues are related to poor governance in one way or another, political considerations contributed to make the problem worse in a variety of ways. 
First of all, the Brazilian legal framework on water management presupposes collaboration between state and municipal governments. When these are led by adversarial political parties – as in the case of São Paulo – collaboration becomes all but wishful thinking and there is a perverse political incentive to see the other side fail at delivering services effectively – to the detriment of users.
Secondly, rather than using the existing State Council on Water Resources, an inclusive and independent body with broad representation to discuss possible solutions to the crisis, the São Paulo governor chose to establish a new “Water Crisis Committee” with political allies and others handpicked by himself.
A third problem relates to a systemic conflict of interest within the state government, which oversees the state water regulatory agency and is the majority shareholder of Sabesp, the water utility company that has a monopoly in the  São Paulo Metropolitan Area. Therefore, the state government is charged with monitoring the performance of its own company and holding itself accountable as the majority shareholder. Given the clear conflict of interest, it is not hard to guess how effective it is in this role.  
Finally, a key driver of water scarcity was the response of the state governor and the water utility company Sabesp to the drought.
The response
By heating or cooling the waters in the Pacific Ocean, the El Niño and La Niña phenomena would normally lead to an increase or decrease of rainfall in the southern part of Brazil, respectively, and affect São Paulo, albeit with less intensity. Several meteorological stations in Brazil monitor the phenomena, and can therefore make projections on the rainfall to be expected. Given that prognostics are available at least six months in advance, by mid-2013 it was already known water security would be severely affected in the second half of the 2013.[5]  
But unfortunately for São Paulo’s citizens, 2014 was an election year.   
Geraldo Alckmin, the state governor, chose to ignore all the early warnings and his efforts to be re-elected and secure Sabesp profits even during the crisis had particularly devastating consequences.  In June 2014, it emerged that Sabesp had invested less than it had planned in sanitation infrastructure to increase the water supply between 2008 and 2013, which could have minimized the impact of the drought. This led Catarina de Alburquerque, the United Nations Special Rapporteur on the human right to safe drinking water and sanitation, to attribute responsibility for the water crisis to the state government, naming lack of planning, investment, and actions to reduce leakages which led to losses estimated at 35%.[6]
So the first “adaptation response” by the government consisted of water rationing along with denial.
By mid 2014, Sabesp, under the guidance of the state government, began interrupting the supply of water in the poorest areas of the city, without previous communication to households, in breach of the national Sanitation Law. Those who complained were told that the system was undergoing maintenance. When interruptions reached middle class households, the company confirmed it had reduced water pressure in its pipes through special valves. Even in the face of ample evidence that some areas had no water for several days, the company never admitted carrying out cuts in the system. It was eventually forced to do so when the Brazilian Institute for Consumer Protection (Instituto Brasileiro de Defesa do Consumidor) got involved and the Access to Information Law was invoked to force Sabesp and the state government to provide information on water cuts.
Indeed, admitting that there were serious problems in the management of water resources in the state that would lead to an interruption of the water supply for 20 million voters and consumers would have presented a blow to Alckmin’s re-election campaign as well to water utility shares – 51% of which he controlled through the state government.
For these reasons, in spite of warnings and intense questioning from the national water agency, experts, civil society and the media, Alckmin blamed “climate change” for the crisis throughout his re-election campaign and denied that water rationing would be necessary.[7]
Having deliberately withheld information from the public as to the seriousness of the water scarcity and the rationing that was already being unofficially implemented, Alckmin was re-elected governor in November 2014 with 57% of the vote. Water rationing was officially declared shortly thereafter.
...and the consequences
Just after the elections, Sabesp increased water tariffs by 6.49% and initiated a policy of incentives and sanctions by providing reduced tariffs to consumers who saved water as well as issuing a fine to those who used more.  This successfully decreased water consumption in 82% of households.[8] In May 2015, another tariff readjustment of 15.24% was requested by the company to the government in order to “balance accounts.” This enabled the company to pay its shareholders dividends in the order of BRL 252.3 million (approximately USD 100 million) in 2013[9] although the main product it sold – water- had become scarce and “discounts” were offered to those consumers who saved water throughout the municipalities it served.
A report released by Greenpeace in early 2016 states that in the state of São Paulo, 10% of all sewage is not collected and 39% is not treated.[10]  The right to sanitation is guaranteed by law in Brazil and is therefore not an adaptation strategy as such but investing in sanitation and treating local sewages so the water can be reused is one way to increase water security in the city.
However, instead of investing in sanitation, the government and Sabesp’s second adaptation strategy is to invest in an expensive river transposition project carried out by an engineering firm that has been implicated in one of Brazil’s greatest corruption scandals.[11] The firm contributed BRL 3.25 million to Alckmin’s re-election campaign in 2014 [12] and the project is due to start in January 2017.
In terms of governance, a model where the government  is the main shareholder and regulator of a water utility company that enjoys a monopoly raises a number of questions in terms of accountability and conflict of interest. When the same government receives campaign contributions from the engineering company it hires later to offer an expensive adaptation solution to water scarcity, it is difficult not to make the link to corruption.  And yet, Governor Alckmin is now one of the leading contenders of his party’s nomination for the country’s 2018 presidential elections.
For Brazil, there may be more serious consequences to come: projections suggest that droughts will become increasingly frequent this century, with a decrease in precipitation of up to 75% in 2100 compared to 2010 if greenhouse gas emissions remain at current levels[13]. 
The São Paulo case shows that the management of water, like any other natural resource, is highly sensitive to governance deficits, political interference and economic interests, and in times of scarcity, it is key to scrutinize the rationale behind rationing and expensive climate change adaptation measures involving public works, like desalination or river transposition. It may well be that cheaper and more effective solutions can be found, such as investing in improving sanitation, investing in retaining forest cover, and making water reuse technologies more widely available.
[1] See Melim-McLeod, C. , Managing Water (In)security: Lessons from a Megacity. In Leal Filho, W et al. (Eds) In Climate Change Adaptation in Latin America: Managing Vulnerability, Fostering Resilience. Springer. Forthcoming. 
[2] Targa, M, Batista G (2015).  Benefits and legacy of  the water crisis in Brazil.  Ambiente e Água. Available at doi:10.4136/ambi-agua.1629. 
[3] IPCC (2008).  Intergovernmental Panel on Climate Change IPCC. Climate Change and Water. Technical Report VI. Bates, B C et al. (eds.), IPCC Secretariat, Geneva.  
[4] Sabesp (2014)  CHESS – Crise Hídrica,  Estratégia e Soluções da Sabesp Para a Região Metropolitana de São Paulo. Available at http://site.sabesp.com.br/site/uploads/file/crisehidrica/chess_crise_hid...
[5] Côrtes P et al.(2015)  Crise de abastecimento de água em São Paulo e falta de planejamento estratégico. Available at http://dx.doi.org/10.1590/S0103-40142015000200002
[6] Jacobi et al.  (2015) Crise da água na região metropolitana de São Paulo. GEOUSP: Espaço e Tempo, 19(3). Available at doi:http://dx.doi.org/10.11606/issn.2179-0892.geousp.2015.104114.
[7] RBA (2014) Alckmin encerra horário eleitoral gratuito culpando mudança climática por falta d'água. Available at http://www.redebrasilatual.com.br/eleicoes-2014/na-tv-alckmin-defende-se...
[8]  SABESP (2014) . See link above.
[9] Martins, E et al. (2015) Crise hídrica e direitos humanos – Relatório de violação de direitos humanos na gestão hídrica do estado de São Paulo. Aliança Pela Água, Coletivo de Luta pela Água, Greenpeace and IDEC, São Paulo. Available at http://www.greenpeace.org/brasil/Global/brasil/documentos/2015/greenpeac...
[10] Ibid.
[11] Costa, M (2015) Grupo de construtoras vence licitação para obra entre represas. Available at http://correio.rac.com.br/_conteudo/2015/07/ig_paulista/292707-grupo-de-... ;  Oliveira, M (2016) PGR denuncia Renan Calheiros ao STF na Lava Jato por lavagem e corrupção. Available at http://g1.globo.com/politica/operacao-lava-jato/noticia/pgr-denuncia-ren... Por Mariana Oliveira, TV Globo, Brasília
[12] Nassif, L and Faermann, P (2015). Como as empreiteiras financiam o PSDB de São Paulo. Available at http://www.revistaforum.com.br/2015/06/30/como-as-empreiteiras-financiam...
[13]SAE (2015) Brasil 2040 Resumo Executivo. Available at http://www.sae.gov.br/wp-content/uploads/BRASIL-2040-Resumo-Executivo.pdf.