Water infrastructure projects are a signifi cant portion of the World Bank’s
lending portfolio and a major need for developing countries throughout the
world. Many water resources projects have long periods of economic return,
with signifi cant uncertainties in the behavior of the natural system as well as
that of human factors (technology, population dynamics, economic development,
and the like). Traditionally, attempts to quantify and incorporate
those uncertainties in planning tools have assumed stationarity of historical
trends. For example, the concept of hydrologic stationarity historically has
been deemed adequate for water project design with at least partial understanding
that hydrologic response (due to land use changes) and hydrologic
variability (due to climate variability and change) are not fully stationary.
The uncertainties associated with climate change, however, have led to a
reconsideration of whether the water development community is adequately
taking into account the uncertainties that characterize the future
(Milly et al. 2008). This additional scrutiny of water resources projects is
warranted, given the large potential regrets associated with possible stark
climate changes in the future. However, the means for conducting this additional
assessment is unclear. No general methodology has been accepted
for assessing the signifi cance of climate risks relative to all other risks for
water resources projects, nor is there an accepted process within the Bank.