feasibility

Supportive local stakeholders are fundamental to the success of WIPs. Feasibility analyses must therefore align with local stakeholders’ knowledge and address their key questions and concerns. Stakeholders, including local communities, should be engaged at both intervention and program scale; and these engagements should happen in parallel and regularly throughout the course of the analysis.

Intervention-Scale: Local communities and experts are likely to have valuable insights regarding which NbS are most likely to succeed in a given watershed, and how to adjust their ‘standard’ designs to maximise likelihood of success. Equally importantly, NbS which are not socially accepted or seen as valuable by local communities and experts are unlikely to be successfully implemented and maintained over time. Stakeholder engagement is therefore necessary to develop a set of NbS options for potential WIPs with buy-in. Refer to the IPLC Engagement Deep Dive for more detail.

Program-Scale: The Business Case aims to generate stakeholder interest in the WIP’s NbS portfolio based on its defined costs and benefits. It is fundamental to engage stakeholders to be able to conduct analyses that are relevant and compelling to them. Working with stakeholders to understand their water uses and water security concerns, gather feedback on methodologies and emerging findings, and co-create the WIP’s NbS investment portfolio, will therefore help generate and grow interest in supporting the WIP.

The main ‘engine’ behind the Business Case is a scientific analysis of the NbS options to implement, and their impact. The features of this analysis will necessarily be determined by watershed context, information availability, scientific literature, and stakeholder feedback (e.g. there may be a trusted and calibrated hydrological model already in use). There are four key steps to the scientific analysis before the economic/financial layer is applied:

Step 1: Define, and engage with, the WIP’s key beneficiaries (stakeholders). This will help determine the geographic scope and units of measurement of the study (e.g. turbidity, nitrogen load, dry season flows, etc.). A strong Pre-Feasibility phase analysis should have mostly already completed this step.

Step 2: Connect ecosystem services in the study area to NbS. Practically performing this step will vary according to available information quantity and quality, prior NbS implementations and research in the area, whether a hydrological model(s) has already been developed and is accessible, and other factors.

Step 3: Determine a ‘business-as-usual’ scenario which forecasts water security changes in the area of interest, in a future without the potential WIP’s activities.

Step 4: Develop one or more ‘intervention scenarios’ which articulate the potential WIP’s impacts. Each scenario should differ from the others according to one simple criteria, such as the quantity of implementation (a decent proxy for funding availability). Scenarios should usually be ‘optimized’, in other words models be allowed to choose the ‘best’ values for other variables (e.g. NbS type, geographical distribution).

Many NbS involve trade-offs – giving up or accepting some impacts in exchange for others. These should be considered as part of your stakeholder engagement and scientific analysis. Refer to the Co-Benefits and Trade-Offs Deep Dive for more detail.

An economic / financial analysis is necessary to build upon the implementation (and benefit) scenarios in order to reach an overall feasibility assessment, for presentation in the Business Case. The depth and breadth of this analysis should be guided by stakeholder engagement – the analysis exists to serve the stakeholders, and therefore it should be built in response to their specifications rather than being over- or under-complicated (in other words, it should meet their ‘burden of proof’ for disbursing funding). This can be thought about in three main steps, as laid out below. Refer to the Economic & Financial Analysis Deep Dive for more detail.

STEP 1: Develop a financial model which articulates the costs and benefits of the implementation scenarios in economic terms. For example, this should include expected implementation and maintenance costs over time, and the scientifically-modelled impacts. This model should be multiple decades in length (e.g. 30 years) to allow NbS to become established and clearly compare the potential of NbS to traditional long-term grey infrastructure projects.

STEP 2: DIdentify program costs which are not included in ‘per unit’ estimates of NbS implementation, such as program management and fundraising, and incorporate these into the financial model. WIPs which lack these programmatic functions will struggle to achieve scale or be sustainable.

STEP 3: Use the financial model to calculate economic and financial indicators of the WIP’s feasibility that are relevant to key stakeholders. It is generally useful to express benefits in economic terms (e.g. $x of water treatment savings, rather than y% of turbidity reduction) to be able to express the WIP’s overall cost-benefit in present-value economic terms, but this is not always possible. Refer to the Sustainable Funding Deep Dive for more detail.

This analysis should help deliver the stakeholder support and cost-benefit quantification necessary to get specific around sustainable financial mechanisms and funding strategies for the WIP in the Design phase.

Governance is not a main focus in the Feasibility phase – as long as key watershed stakeholders are active and supportive participants in the analysis, it is generally not necessary to press ahead on governance. In other words, governance is usually better left to the Design phase, after Feasibility analyses have helped justify stakeholders’ long-term interest in the WIP. That said, if governance considerations are a barrier or enabler to the involvement of key stakeholders in the Feasibility phase and/or the future WIP, then beginning to assess governance may be worthwhile. Also, any work relating to specific governance considerations highlighted in the Pre-Feasibility phase should continue. Refer to the Design phase or the Governance Deep Dive for more detail.

Some stakeholders may require a degree of formalization before they are willing to share information or collaborate towards the analysis (e.g. a Memorandum of Understanding, or a non-disclosure agreement). A good Pre-Feasibility phase should have culminated in the development of such materials where necessary. This is a positive indication of interest that should be taken up, but is not the same as a governance design for a WIP, and should therefore not be communicated as such.

Feasibility does not generally include pilot NbS implementations, but practical implementation considerations must feature in the NbS Options Catalogue. At a minimum, these should include:

• Labor and equipment requirements per ‘unit’ of NbS.

• Time (e.g., person-days of work, permitting requirements) and timing (e.g., seasonal variations, time between activities) per ‘unit’ of NbS.

• How local conditions interact with the above (e.g. the amount and timing of local implementation capacity).

• Local community acceptance of the proposed NbS and understanding/perception of their benefits.