The economics of climate change adaptation strategies in the Ceres Region, Western Cape
Ogundeji, Abiodun Akintunde
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The Western Cape (WC) region of South Africa, with its Mediterranean-type climate and predominantly winter rainfall, has been identified as highly vulnerable to projected climate change within both global and national contexts. The province will experience increasing temperatures and reductions in water supply in the future and these have to be adequately prepared for in order to mitigate these impacts. The aim of this study is to develop and apply an integrated approach to quantify the economic impact of climate change on the agriculture and water resource sectors of Ceres, in Western Cape, South Africa. Although researchers have been able, to model, to a certain extent, the impact of climate change on the farm sector using integrated methodology, they have not yet included the impact of future change in crop water requirements as well as the impact of accumulated chill units. So currently, we do not have empirical knowledge of how the current and future change in crop water requirements and accumulated chill units will affect the farm structure. Thus in order to accurately quantify the impacts of different adaptation strategies at farm level, the existing models need to be adjusted and methodology developed to incorporate the impact of temperature. SAPWAT was used to estimate crop water requirements for the base climate (1971-1990) and for the future climate (2046-2065). Results show that crop water requirements will increase as a result of projected climate change using the A2 climate change scenario. The water requirements for drip are less than that of Sprinkler, because of efficiency differences in the irrigation systems. The drip irrigation system is said to be a more efficient irrigation technology. It was also confirmed that future crop water requirements for drip irrigation system is still lower than the current water requirement under sprinkler. Accordingly, despite substantial increase in water requirements, under drip system, the total water requirement will be less under drip system compared to sprinkler system. The Utah model (Richardson) and Daily positive Utah (Infruitec) chill unit accumulation model are used to test the hypothesis that winter chill will in Ceres reduce with climate change. Results from both models confirmed that climate change will result in reduction of future accumulation of chill units. The impact of climate change (projected temperature increase) on chill unit accumulation is more pronounced using Richardson model compared to Infruitec model. The result shows that it might be difficult to produce some fruit crops in the future in the Ceres region owing to insufficient chill that would be accumulated in the future. This will likely require growers’ transition to different species or cultivars or develop management practices (planting density, pruning practices and irrigation regime) that can help overcome shortages in winter chill. Results from crop water and chill unit models were incorporated into other models to develop the Ceres Dynamic Integrated Model. The model was used to simulate various climate change scenarios, and the results correspond with what can be expected from the prediction of impact on agriculture. The impact of climate change has resulted in changes in area, water use and welfare of the farmers in the future climate. Three different sets of adaptation strategies were evaluated using the developed integrated model. These three adaptation strategies include; availability of farm dam and water right; improving water use efficiency; and increase in water tariffs. Farm dam capacity and winter water allocation seems to be the best adaptation strategy based on the results from this research. Giving farmers farm dam capacity alone, however will not improve the situation of the farmers, they also need water rights. Caution should be taken when considering such an adaptation option. Farm dam is a capital intensive infrastructure and if the farm dams don’t fill up, it may worsen the situation of farmers since the high capital cost and resulting high unit cost of farm dam water will increase their financial vulnerability. Thus, giving farmers farm dam capacity and winter water right could be a good adaptation strategy but other issues surrounding its suitability should be considered. Increasing water use efficiency as an adaptation option according to analysis done in this study is also a good adaptation option for the Ceres farmers. Improved water management practices that increase the efficiency of irrigation water use may provide a significant adaptation potential under future climate change. Using water more efficiently improves the welfare of the farmers and also saves water for optimal irrigation usage. The model results indicate that increasing water tariffs as an adaptation strategy to climate change is less effective in the agricultural sector and can even result in a negative impact since farmers grow deciduous fruit crops which often use even more water irrespective of the tariff regime. Again, the price elasticity of demand for agricultural water is very inelastic since they cannot simply stop irrigating or change to deficit irrigation. Therefore, using water more efficiently will be the best adaptation option based on the analysis done in this thesis to help the Ceres farmers cope with the future projected impact of climate change. Overall, a change in the farm profile in Ceres can be expected as a result of climate change and adaptation thereto.