Development of the global hydro-economic model (ECHO-Global version 1.0) for assessing the performance of water management options

Abstract. Water scarcity is one of the most critical global environmental challenges. Addressing this challenge requires implementing economically-profitable and environmentally-sustainable water management interventions across scales globally. This study presents the development of the global version of the ECHO hydro-economic model (ECHO-Global version 1.0), for assessing the economic and environmental performance of water management options. This global version covers 282 subbasins worldwide, includes a detailed representation of irrigated agriculture and its management, and incorporates economic benefit functions of water use in the agricultural, domestic and industrial sectors calibrated using the Positive Mathematical Programming (PMP) procedure alongside with the water supply cost. We used ECHO-Global to simulate the impact of alternative water management scenarios under future climate and socio-economic changes, with the aim of demonstrating its value for informing water management decision making. Results of these simulations are overall consistent with previous studies evaluating the global cost of water supply and adaptation to global changes. Moreover, these results show the changes in water use and water supply and their economic impacts in a spatially-explicit way across the world, and highlight the opportunities for reducing those impacts through improved water management. Overall, this study demonstrates the capacity of ECHO-Global to address emerging research and practical questions related to future economic and environmental impacts of global changes on water resources and to translate global water goals (e.g., SDG6) into national and local policies.