BUILDING LOW EMISSION ALTERNATIVES TO DEVELOP ECONOMIC RESILIENCE AND SUSTAINABILITY (B-LEADERS) PROJECT MINDANAO WATER-ENERGY NEXUS STUDY Final Report November 2017 This document was produced for review by the United States Agency for International Development (USAID). It was prepared by the Building Low Emission Alternatives to Develop Economic Resilience and Sustainability (B-LEADERS) Project implemented by International Resources Group for USAID Philippines. BUILDING LOW EMISSION ALTERNATIVES TO DEVELOP ECONOMIC RESILIENCE AND SUSTAINABILITY (B-LEADERS) PROJECT MINDANAO WATER-ENERGY NEXUS STUDY Final Report November 2017 DISCLAIMER The authors’ views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government. TABLE OF CONTENTS Table of Contents ······································································· iii List of Figures ············································································· v List of Tables ············································································· vii Acronyms ················································································· viii Executive Summary ····································································· 1 1. Introduction ········································································ 4 1.1. Study Background ................................................................................................................................. 4 1.1.1. Purpose ................................................................................................................................... 4 1.1.2. The Water-Energy Nexus .................................................................................................. 5 1.1.3. Research Questions ............................................................................................................. 6 1.1.4. Study Team............................................................................................................................. 6 1.1.5. Approach ................................................................................................................................ 7 1.2. Background on Mindanao and the Ranao-Agus Basin .................................................................. 9 1.2.1. Mindanao ................................................................................................................................. 9 1.2.2. Ranao-Agus River Basin..................................................................................................... 15 1.2.3. Agus Hydropower Complex ............................................................................................ 17 2. Model Specifications ···························································· 19 2.1. Water System Model ......................................................................................................................... 19 2.1.1. WEAP Overview ................................................................................................................ 19 2.1.2. Model Scope and Boundaries ........................................................................................... 19 2.1.3. Model Structure .................................................................................................................. 20 2.1.4. Input Data ............................................................................................................................. 20 2.1.5. Model Calibration ............................................................................................................... 33 2.2. Energy System Model ........................................................................................................................ 35 2.2.1. LEAP Overview ................................................................................................................... 35 2.2.2. Model Scope and Boundaries ........................................................................................... 35 2.2.3. Model Structure .................................................................................................................. 36 2.2.4. Input Data ............................................................................................................................. 36 2.2.5. Integration of Water Model Outputs ............................................................................ 58 2.2.6. Energy Scenarios ................................................................................................................. 59 3. Modeling Results and Discussion ··········································· 60 iii | MINDANAO WATER-ENERGY NEXUS STUDY 3.1. Hydropower Availability and Production ..................................................................................... 60 3.2. Potential Role of Hydropower in Mindanao’s Electricity Mix ................................................. 62 3.3. Comparison with NREP .................................................................................................................... 66 3.4. Key Sensitivities................................................................................................................................... 67 4. Conclusion ········································································· 69 4.1. Major Findings ..................................................................................................................................... 69 4.2. Potential Next Steps .......................................................................................................................... 70 4.2.1. Refining Climate Projections ............................................................................................ 70 4.2.2. Better Characterizing Water Demands ........................................................................ 70 4.2.3. Improving Data Accessibility ............................................................................................ 71 4.2.4. Refining Estimate of Hydropower Resource Potential .............................................. 71 4.2.5. Considering Potential Impacts of Armed Conflict ...................................................... 71 4.2.6. Characterizing Deforestation and Land-Use Change ................................................ 71 5. Annexes ············································································ 72 5.1. Annex 1: Study WEAP Model ......................................................................................................... 72 5.2. Annex 2: Study LEAP Model ............................................................................................................ 72 6. References ········································································· 73 iv | MINDANAO WATER-ENERGY NEXUS STUDY LIST OF FIGURES Figure 1: Map of Mindanao .............................................................................................................................................. 4 Figure 2: Stakeholder Discussion at Consultative Workshop in Davao City, May 2016 ................................. 7 Figure 3: Map of River Basins in Mindanao .................................................................................................................. 7 Figure 4: Historical Gross Domestic Product and Gross Regional Domestic Product .................................... 9 Figure 5: Historical Electricity Consumption in Mindanao .................................................................................... 11 Figure 6: Installed Electricity Generation Capacity in Mindanao by Technology ............................................. 12 Figure 7: Historical Electricity Generation in Mindanao by Technology ............................................................ 13 Figure 8: Map of Risk of Projected Temperature Increase in Mindanao ............................................................ 14 Figure 9: Climate Map of Mindanao............................................................................................................................. 15 Figure 10: Map of Ranao-Agus Basin with Agus Hydroelectric Plant Locations ............................................... 16 Figure 11: Location Plan and Profile of Agus Hydroelectric Plants ..................................................................... 18 Figure 12: Historical Annual Precipitation in Ranao-Agus Basin (1901-2014) .................................................. 21 Figure 13: Historical Average Precipitation by Month in Ranao-Agus Basin ..................................................... 21 Figure 14: Historical Average Annual Temperature in Ranao-Agus Basin (1901-2014) ................................. 22 Figure 15: Observed and Projected Annual Mean Temperature Anomalies in Philippines (1951-2100) ... 25 Figure 16: Maps of Projected Seasonal Temperature Increase in Philippines Relative to 1971-2000, A1B Scenario .............................................................................................................................................................................. 26 Figure 17: Maps of Projected Seasonal Rainfall Change in Philippines Relative to 1971-2000, A1B Scenario .............................................................................................................................................................................. 27 Figure 18: Projected