Special Report
Sustainable water use in agriculture:
CAP funds more likely to promote greater rather
than more efficient water use
EN
20
21
20
2
Contents
Paragraph
Executive summary I-VII
Introduction
01-18
Water availability in the EU: current status and future scenarios 01-03
Agriculture needs water
04-06
The EU’s role in water quantity policy
07-18
Water Framework Directive 08-11
Common agricultural policy 12-18
Audit scope and approach 19-24
Observations
25-89
EU policy on sustainable water use involves derogations that
apply to agriculture
25-52
Member States have authorisation systems in place, and apply many
derogations 27-35
Member States have introduced incentivising pricing mechanisms, but cost
recovery is lower in agriculture than in other sectors 36-44
The Commission considers WFD implementation to be progressing slowly 45-52
CAP direct payments do not significantly encourage efficient
water use
53-68
CAP income support does not promote efficient water use or water
retention 55-57
The EU supports water-intensive crops in water-stressed areas through
voluntary coupled support 58-61
Cross-compliance covers illegal abstraction of water, but checks are
infrequent and penalties are low 62-68
3
Rural development funds and market measures do not
significantly promote sustainable water use
69-89
Rural development programmes are seldom used to improve water quantity 70-74
EU funding for irrigation projects has weak safeguards against unsustainable
water use 75-89
Conclusions and recommendations 90-98
Abbreviations
Glossary
Replies of the Commission
Timeline
Audit team
4
Executive summary
I Demographic growth, economic activity and climate change are increasing both
seasonal and perennial water scarcity in the EU. A substantial part of the territory is
already affected by water abstraction in excess of the available supplies, and current
trends indicate increasing water stress.
II Agriculture depends on water availability. Irrigation helps to shield farmers from
irregular rainfall, and to increase the viability, yield and quality of the crops, but is a
significant drain on water resources. While around 6 % of EU farmland was irrigated in
2016, the sector was responsible for 24 % of all water abstraction.
III In 2000, the Water Framework Directive (WFD) introduced the concept of water
quantity into EU policy-making. It established the ambitious target of “good”
quantitative status for all groundwater bodies by 2027 at the latest. This means that
water abstractions should not lower groundwater levels to the extent that it leads to a
deterioration, or non-achievement of good water status. For most Member States, the
situation has improved, but in 2015, the quantitative status of around 9 % of
groundwater in the EU was “poor”. The Commission has assessed the WFD as being
largely fit for purpose, but has noted significant delay in achieving targets.
IV The common agricultural policy (CAP) could incentivise sustainable agriculture in
the EU by linking payments to environmental standards. Sustainable agriculture in
terms of water use is embedded in the current CAP’s policy objectives and in the
proposals for the post-2020 CAP. The wide range of practices supported (including
support coupled to specific products, support for water retention measures or
investments in new irrigation) affect water use in agriculture in different ways.
V Our audit focused on the impact of agriculture on the quantitative status of water
bodies. We examined to what extent the WFD and the CAP promote the sustainable
use of water in agriculture.
VI We found that agricultural policies at both EU and Member State level were not
consistently aligned with EU water policy. Systems for authorising water abstraction
and water pricing mechanisms contain many exemptions for agricultural water use.
Few CAP schemes link payments to strong sustainable water use requirements. Cross-
compliance, a mechanism that may lead to (typically small) reductions in subsidy
payments if farmers are found to have breached certain requirements, discourages
5
unsustainable water use, but does not apply to all CAP support or to all farmers. The
CAP funds projects and practices expected to improve sustainable water use, such as
water retention measures, wastewater treatment equipment and projects improving
the efficiency of irrigation systems. However, these are less common than projects
likely to increase the pressure on water resources, such as new irrigation projects.
VII Based on our findings, we recommend that the Commission:
(1) ask Member States to justify water pricing levels and exemptions from the
requirement for water abstraction authorisations when putting the WFD into
practice in agriculture;
(2) link CAP payments to environmental standards on sustainable water use;
(3) ensure that EU-funded projects help achieve the WFD objectives.
6
Introduction
Water availability in the EU: current status and future scenarios
01 According to the World Bank, over the past 55 years, there has been an EU-wide
decrease of 17 % in renewable water resources per capita
1
. Though this is partly due to
population growth, pressure from economic activity and climate change is also
aggravating seasonal and yearlong water scarcity in parts of the EU.
02 Climate change, with higher average temperatures and more frequent, more
extreme weather events (including droughts), is making freshwater scarcer in the EU
2
.
Forecasts indicate water stress is likely to increase in a significant portion of the EU by
2030 (Figure 1).
03 According to the Commission, “extreme droughts in western and central Europe
in 2018, 2019 and 2020 caused considerable damage. (…) With global warming at 3 °C,
droughts would happen twice as often and the absolute annual drought losses in
Europe would increase to €40 billion/year
3
.”
1
World Bank, Renewable internal freshwater resources per capita (cubic meters) - European
Union.
2
European Commission – JRC, “World Atlas of Desertification”, Change in aridity - shifts to
drier conditions.
3
Communication from the Commission to the European Parliament, the Council, the
European Economic and Social Committee and the Committee of the Regions: Forging a
climate-resilient Europe - the new EU Strategy on Adaptation to Climate Change
(COM(2021) 82 final).
7
Figure 1 – Water stress in the EU and future projections
© World Resources Institute – Aqueduct, accessed on 22/03/2021.
Agriculture needs water
04 Agricultural production depends on water availability. Irrigation offers multiple
benefits to farmers, such as increased crop viability, yield and quality. Irrigation water
comes from streams, rivers and lakes (surface water bodies), wells (groundwater
bodies), rainwater collection and reclaimed wastewater. Around 6 % of farmland in the
EU was irrigated in 2016. Drinking water for animals accounts for a small proportion of
agricultural water use.
05 Agriculture affects both water quality (e.g. through diffuse pollution from
fertilisers or pesticides) and water quantity. Low water flow, for example, decreases
the dilution of pollutants, thereby reducing water quality, and excessive water
abstraction in coastal areas can cause saltwater intrusion in the groundwater.
Water stress
baseline
(ratio of total water
withdrawals to available
renewable surface and
groundwater supplies)
Low (< 10 %)
Low-medium (10-20 %)
Medium-high (20-40 %)
High (40-80 %)
Very high (> 80 %)
Current situation
(baseline)
2030
Change from
baseline
(Variation in water stress
in a “business as usual”
scenario)
1.4x decrease or greater
Near normal
1.4x increase
2x increase
2.8x increase or greater
8
06 A recent report of the European Environment Agency (EEA)
4
indicates that
agriculture is responsible for 24 % of water abstraction in the EU: “the last 30 years
have seen some reduction in pressures, achieved thanks to efficiency gains in resource
use. Agricultural water use at the EU level has decreased by 28 % since 1990, while
nitrogen surplus has decreased by 10 % and nitrate concentration in rivers by 20 %
since 2000. However, further gains were modest in the 2010s and pressures continue
to remain at highly unsustainable levels.” In 2015, Member States reported to the
Commission the share of water bodies under significant pressure from agricultural
water abstraction (see Figure 2).
Figure 2 – Number of water bodies under significant pressure from
agricultural water abstraction
Source: ECA, based on EEA, 2018, ‘WISE Water Framework Directive (data viewer)’, European
Environment Agency.
4
European Environment Agency, “Water and agriculture: towards sustainable solutions”,
EEA Report No 17/2020.
Surface water Groundwater
0 %
1 – 5 %
5 – 10 %
10 – 20 %
20 – 40 %
> 40 %
Number of water bodies (%) under significant
pressure from agricultural abstraction
9
The EU’s role in water quantity policy
07 The main elements of the EU’s regulatory framework for water quantity and
agriculture are the Water Framework Directive
5
(WFD) and the common agricultural
policy (CAP). The main roles and responsibilities within the EU are outlined in Figure 3.
Figure 3 – Main roles and responsibilities (2014-2020)
Source: ECA.
5
Directive 2000/60/EC of the European Parliament and of the Council of 23 October 2000
establishing a framework for Community action in the field of water policy (OJ L 327,
22.12.2000, pp. 1-73).
European Commission
Environment
(DG ENV)
Monitor
implementation of the
WFD
• Assess Member States’
RBMPs and produce
implementation reports
• Assess Member States’
compliance with the
WFD, particularly the
exemptions, measures
related to abstraction
controls and water
efficiency
Agriculture
(DG AGRI)
• Put in place the legal
framework for the CAP
• Ensure Member States
implement the CAP in
accordance with the
legal framework
• Approve RDPs and
monitor their
implementation
• Review the application
of cross-compliance
Design and oversee
implementation of the
CAP
Implement the CAP
Agriculture
(ministry of agriculture,
paying agencies,
managing authorities)
• Establish specific rules
for direct payments
• Draw up a national
framework and strategy
for operational
programmes in the fruit
and vegetable sector,
and support
programmes
in the wine
sector
• Prepare and implement
RDPs
• Detail and apply cross-
compliance
requirements
Environment
(e.g. competent
authorities for RBDs,
water authorities)
Implement the WFD
• Develop an RBMP for
each river basin district
within their territory
• Set up and operate a
water pricing system
• Set up and operate a
system to control water
abstraction
Member States
Task Force on Water and Agriculture
(DG AGRI, DG ENV, DG JRC, DG RTD and DG SANTE)
Coordinated initiative to work towards sustainable
water management
Acronyms: CAP – common agricultural policy; WFD
–
water framework directive; RDP – rural development programme; RBMP
– river basin management plan; RBD – river basin district
10
Water Framework Directive
08 The EU has had policies for improving water quality since 1991 (Urban Waste
Water Treatment and Nitrates directives). In 2000, the WFD introduced policies
relating also to water quantity. It promotes an ecosystem-based approach to managing
water, including principles such as water management at the scale of river basins,
public participation, and the need to consider the impact of human activities on water
resources.
09 Under the WFD, Member States must prepare river basin management plans
(RBMPs)
6
. These documents give details of monitoring, main pressures, objectives,
exemptions and measures for the next six-year period. Member States first submitted
plans to the Commission in 2009, and again in 2015. The Commission assesses
progress every three years
7
.
10 The WFD set a target of achieving good quantitative status for all groundwater
bodies by 2015, and by 2027 at the latest where justified exemptions apply. This
means that water abstractions should not lower groundwater levels to the extent that
it leads to a deterioration, or non-achievement of good water status. According to the
Commission’s latest implementation report
8
, in most Member States the situation
improved from 2009 to 2015, but the quantitative status of around 9 % of
groundwater bodies in the EU (by area) was still “poor” (Figure 4). The WFD addresses
quantitative aspects of surface water bodies in the definition of good ecological status,
namely the hydro-morphological elements (i.e. flow regime). Member States should
define objectives of "ecological flow" for each surface water body, which aim at
ensuring that there is sufficient water.
6
European Commission, Status of implementation of the WFD in the Member States.
7
Directive 2000/60/EC, Article 18.
8
European Commission, SWD(2019) 30 final, “European Overview - River Basin Management
Plans”.
11
Figure 4 – Quantitative status of groundwater bodies
Source: ECA based on EEA, 2018, 'Groundwater quantitative and chemical status'.
11 In 2019, the Commission assessed the performance of the WFD between the end
of 2017 and mid-2019
9
. The overall conclusion of this assessment was that the WFD
was largely fit for purpose, although the Commission also noted: “the Directive’s
implementation has been significantly delayed (…). This is largely due to insufficient
funding, slow implementation and insufficient integration of environmental objectives
in sectoral policies.”
Common agricultural policy
12 Sustainably managing natural resources (including water) is one of the three
policy objectives for the 2014-2020 CAP
10
, alongside viable food production and
balanced territorial development. In 2018, the Commission published a proposal for
9
European Commission, EU Water Legislation - Fitness Check.
10
Communication from the Commission to the European Parliament, the Council, the
European Economic and Social Committee and the Committee of the Regions, "The CAP
towards 2020: Meeting the food, natural resources and territorial challenges of the future",
COM(2010) 0672 final.
0 %
25 %
50 %
75 %
100 %
Malta
Cyprus
Belgium
Hungary
Spain
France
Greece
Italy
Sweden
Czechia
Poland
Germany
Slovakia
Denmark
Portugal
Bulgaria
Estonia
Croatia
Finland
Ireland
Austria
Latvia
Lithuania
Luxembourg
Netherlands
Romania
Slovenia
Poor quantitative status by area (2015) Good quantitative status by area (2015)
Unknown quantitative status by area (2015) Poor quantitative status by area (2009)
12
the post-2020 CAP
11
. The nine specific objectives proposed include fostering
sustainable development and efficiently managing natural resources such as water, soil
and air.
13 The largest share of the CAP budget goes to direct payments (71 %)
12
. These
include:
o Decoupled income support such as the basic payment scheme (BPS), the single
area payment scheme (SAPS) and the greening payment, which together account
for 61 % of the CAP budget: €35.3 billion in 2019
13
.
o Voluntary coupled support (VCS), paid by area or by head of livestock. Member
States can use this optional direct payment scheme to support specific
agricultural sectors that are undergoing difficulties and are particularly important
for economic, social or environmental reasons. They allocated around
€4.24 billion to VCS in 2020
14
, with one quarter going to area-based support.
14 Producers of fruit and vegetables, wine and olive oil qualify for “common market
organisation” (CMO) support to help them adapt to market changes. CMO measures
include support for investments with a potential impact on water use.
15 The European Agricultural Fund for Rural Development (EAFRD) supports EU rural
development policy through Member States’ rural development programmes (RDPs).
RDPs are drawn up on a national or regional basis and address EU priorities over a
seven-year period. They include support for agricultural practices and investments
with a potential impact on water use.
11
Proposal for a Regulation of the European Parliament and of the Council establishing rules
on support for strategic plans to be drawn up by Member States under the Common
agricultural policy (CAP Strategic Plans) and financed by the European Agricultural
Guarantee Fund (EAGF) and by the European Agricultural Fund for Rural Development
(EAFRD), COM(2018)392 final.
12
European Commission, CAP Indicators - Financing the CAP.
13
European Commission, SWD(2020) 168 final.
14
European Commission, “Voluntary coupled support - Review by the Member States of their
support decisions applicable as from claim year 2020”.
13
16 Reusing treated wastewater is part of a circular economy. According to a 2015
study carried out for the Commission, around 1 100 million m³ of wastewater (some
0.4 % of annual EU freshwater abstractions) was being reused every year in the EU
15
.
The EU adopted a regulation on reusing wastewater for agricultural irrigation in May
2020
16
. It sets minimum requirements for water quality, monitoring, risk management
and transparency, and will apply from June 2023. According to the Commission’s
impact assessment
17
, the regulation will enable the reuse of “more than 50 % of the
total water volume theoretically available for irrigation from wastewater treatment
plants in the EU and avoid more than 5 % of direct abstraction from water bodies and
groundwater, resulting in a more than 5 % reduction in water stress overall”. The CAP
can finance water treatment infrastructure for the reuse of wastewater for irrigation.
17 Most direct payments, as well as some rural development and certain CMO
payments for the wine sector, are subject to a set of rules known as cross-compliance.
These comprise statutory management requirements (SMRs) from selected directives
and regulations on the environment, food safety, plant health, animal health and
welfare, and standards for good agricultural and environmental condition (GAEC),
which impose sustainable agricultural practices. CAP beneficiaries that are found not
to respect these rules as defined by national legislation may face a reduction in their
annual EU grant.
18 For example, GAEC 2 provides a mechanism to assess whether farmers
abstracting water for irrigation comply with the authorisation procedures in their
Member State. Between 2015 and 2018, 1.2 % of the CAP beneficiaries to which GAEC
2 applied were checked each year. These checks detected a low percentage of
infringements (1.5 %), most of which were penalised by a reduction of 3 % (Figure 5)
in the subsidy paid to the farmer concerned.
15
BIO by Deloitte (in collaboration with ICF and Cranfield University), “Optimising water reuse
in the EU – Final report prepared for the European Commission (DG ENV)”, Part I.
16
Regulation (EU) 2020/741 of the European Parliament and of the Council of 25 May 2020
on minimum requirements for water reuse (OJ L 177, 5.6.2020, pp. 32-55).
17
European Commission, SWD(2018) 249 final/2 - 2018/0169 (COD).
14
Figure 5 – GAEC 2 checks (average 2015-2018)
Source: ECA based on data received from the European Commission.
Percentage of farmers checked
(of those to which GAEC 2 applied)
Percentage of
infringements
Outcome of
infringement
1.2 %
1.5 %
Reduction (5 %)
25.4 %
Reduction (3 %)
67.9 %
Reduction (1 %)
4.6 %
Early warning
2.2 %
15
Audit scope and approach
19 This audit focuses on the impact of agriculture on the quantitative status of
water. As agriculture is both a major user of freshwater and one of the first sectors to
be impacted when water is scarce, we assessed to what extent EU policies, namely the
CAP and water policy, promote the sustainable use of water in agriculture.
20 The Council declared in 2016
18
that the EU’s water policy objectives should be
better reflected in other policy areas, such as food and agriculture. The European
Parliament has also called for better policy coordination. Water is the subject of UN
Sustainable Development Goal 6 (“water and sanitation for all”), whose targets relate
to water efficiency and integrated water management.
21 We examined to what extent:
o the WFD promotes sustainable water use in agriculture;
o CAP direct payment schemes take account of the WFD principles of sustainable
water use;
o CAP rural development and market measures have taken up the WFD principles
of sustainable water use.
22 The audit did not cover diffuse pollution of water due to agriculture (e.g. from
nitrates or pesticides). Previous ECA reports
19
have focused on this in more detail.
18
Sustainable Water Management Council Conclusions, 17 October 2016.
19
ECA special report 04/2014: “Integration of EU water policy objectives with the CAP: a
partial success”; ECA special report 23/2015: “Water quality in the Danube river basin:
progress in implementing the water framework directive but still some way to go”; ECA
special report 03/2016: “Combating eutrophication in the Baltic Sea: further and more
effective action needed”.
16
23 The audit ran from April to December 2020. We interviewed staff at the
Commission and Member State authorities and consulted other stakeholders in the
water and agricultural sectors. We examined:
o the Commission’s strategic documents, working documents, studies, evaluations,
guidance documents, statistics, water quantity implementation reports and
agricultural policies;
o rural development programmes, and national and regional rules and guidance on
cross-compliance, direct payment schemes, market and rural development
measures, as well as studies, research, analysis and statistics on penalties;
o river basin management plans, water abstraction rules and pricing policies;
o other relevant studies and reports, including those by the Organisation for
Economic Co-operation and Development (OECD) and the European Environment
Agency (EEA).
24 Our audit covered the 2014-2020 CAP programming period. We performed
extended desk reviews for 11 Member States/regions (see Figure 6), seeking a
geographical balance between areas currently facing water scarcity and others where
this is likely to become an issue in the future. In six of the Member States, we focused
our work on one or two regions, as some Member States have regional RDPs and
water management measures are decided at river basin level. We also obtained
evidence for other Member States/regions from a desk review of 24 additional RDPs
and the audit work carried out for our annual report.
17
Figure 6 – Desk reviews
Source: ECA.
Extended desk review
Belgium (Flanders)
Bulgaria
Germany (Berlin-Brandenburg)
Greece (Thessaly)
Spain (Andalusia)
Spain (Castile-La Mancha)
France (Centre-Val de Loire)
Italy (Emilia-Romagna)
Cyprus
Hungary
Portugal (Mainland)
Desk review of RDPs:
Belgium (Wallonia), Czechia, Denmark, Germany (Saxony-Anhalt), Estonia, Ireland, Spain (Canaries), France (Alsace), Croatia, Italy (Sicily),
Italy (Liguria), Latvia, Lithuania, Luxembourg, Malta,
Netherlands
, Austria, Poland, Portugal (Madeira), Romania, Slovenia, Slovakia,
Finland, Sweden
18
Observations
EU policy on sustainable water use involves derogations that
apply to agriculture
25 The WFD provides safeguards against unsustainable water use. It requires
Member States, inter alia, to:
o operate a water abstraction authorisation system and register
20
;
o adopt water pricing policies that incentivise efficient water use and ensure
adequate cost recovery for water services from the various users (including
farmers)
21
.
26 We examined the extent to which Member States apply the above requirements
on water abstraction management, water pricing and cost recovery in the agricultural
sector, and how the Commission monitors their work.
Member States have authorisation systems in place, and apply many
derogations
27 The WFD requires Member States to keep a register of surface water and
groundwater abstractions and surface water storage (“impoundment”). Water users
must request prior authorisation to abstract or store water, but Member States may
choose to apply exemptions where abstraction or storage has no significant impact on
water status.
28 As part of water abstraction management, Member States are required to
identify and penalise any parties that use water without authorisation/notification or
fail to comply with water abstraction rules (e.g. as specifically authorised).
20
Directive 2000/60/EC, Article 11.3(e).
21
Directive 2000/60/EC, Article 9.
19
Prior authorisation systems
29 In eight of the 11 Member States/regions we covered in our audit, all water
abstraction points must be notified to the authorities. All of the Member
States/regions covered in our audit have a prior authorisation system for water
abstraction. When granting authorisations, Member State authorities take into
account the status of the water body concerned and specify the maximum annual (or
monthly) quantity that may be abstracted.
30 Member States apply numerous exemptions (see Figure 7). These can have a
significant impact on the quantitative status of the water bodies concerned. Where
there is also no mandatory metering, the authorities cannot monitor whether
abstraction remains below a significant level. This is the case for certain types of
abstractions in Belgium (Flanders), Bulgaria, Germany (Berlin-Brandenburg), Italy
(Emilia-Romagna), Cyprus and Portugal.
20
Figure 7 – Exemptions from authorisation for water abstraction
Source: ECA, based on data from the Member States, and Eurostat.
No authorisation needed
• Belgium (Flanders): surface
water from non-
navigable
waterways
• Bulgaria and Italy (Emilia-
Romagna): surface
water and
groundwater for
private/domestic
use
• Germany (Berlin
-Brandenburg
):
all surface water for landowners
and riparians and groundwater
for the household and in small
quantities for temporary
purposes
• Hungary: groundwater for
irrigation from wells less than 50
metres deep, subject from 2021
to certain restrictions and
requirements
No authorisation needed in exceptional
circumstances
• Greece: occasional water use in cases of
force majeure, emergency and/or
unforeseen need
• Hungary: temporary pumping stations
may be used, with certain limitations, to
obtain surface water for irrigation
during periods of ‘permanent water
scarcity’. Since 2017, permanent water
scarcity has been declared for several
months each year during spring or
summer
No authorisation needed
below a certain yearly
volume or abstraction
capacity
• Maximum thresholds vary
from 500 to 200 000
m³/year (see below)
No authorisation needed
for certain legacy
abstractions
• Cyprus
• Portugal
France
(groundwater
outside a water
stressed area – zone
de répartition des
eaux)
200 000 m
3
/year
Spain
(Andalusia / Castile-La
Mancha)
(groundwater if
body not declared
overexploited / at
risk)
7 000 m
3
/year
Germany
(Berlin-Brandenburg)
(groundwater for
farmyard use and
watering non-
farmyard animals)
5 000 m
3
/year
Belgium
(Flanders
)
(surface water
abstraction from
navigable
waterways)
500 m
3
/year
Cyprus
(maximum 5
m
3
/day)
1 825 m
3
/year
Average
household
consumption
(four persons)
Average amount
abstracted for
agriculture per
hectare of irrigated
land
Exemption ceilings for water abstraction authorisations
3 800
m3/year
175
m3/year
21
Systems for detecting illegal water use
31 Official recent data on illegal water abstraction in the EU is scarce. In 2015, the
OECD compiled estimates from a range of sources, such as 50 000 illegal boreholes in
Cyprus and over half a million unauthorised or illegal wells in Spain
22
. According to the
Worldwide Fund for Nature, the issue is especially acute in Castile-La Mancha and
Andalusia
23
. In Hungary, experts estimate unlicensed water use at nearly
100 million m³/year, or 12 % of registered abstractions
24
.
32 Ten of the Member States/regions we examined have a control system in place to
detect and penalise illegal water use. They carry out on-the-spot checks of registered
abstraction points based on an annual control plan, risk analysis and/or complaints.
The infringements detected in this way include unauthorised water use, unmetered
pumping, excessive pumping and various other breaches of the terms of authorisation.
Figure 8 shows the rate of infringements revealed by inspections of water abstraction
points.
Figure 8 – Infringements revealed by inspections of water abstraction
points for agriculture
Source: ECA.
22
OECD, “Drying Wells, Rising Stakes: Towards Sustainable Agricultural Groundwater Use”.
23
WWF, “Illegal water use in Spain: Causes, effects and solutions”.
24
Second river basin management plan of the Danube (2015), point 2, p. 10.
4.1 %
13.6 %
6.6 %
8.0 %
13.3 %
10.8 %
Belgium
(Flanders)
Bulgaria
Cyprus
Germany
(Brandenburg)
Greece
Spain
(Andalusia)
Spain
(Castile -
La Mancha)
France
(Centre
Val de Loire)
Hungary
Italy
(Emilia-
Romagna)
Portugal
(Mainland)
Not available
Not available
Not available
Not available
Belgium
(Flanders)
Bulgaria
Cyprus
Germany
(Berlin-
Brandenburg)
Greece
(Thessaly)
Spain
(Andalusia)
Spain
(Castile
-
La Mancha)
France*
(Centre-
Val de Loire)
Hungary
Italy
(Emilia-
Romagna)
Portugal
(Mainland)
* May include checks on water abstraction by other economic sectors
Not available
Infringement found
No infringement found
22
33 In addition to on-the-spot checks of registered water abstraction facilities, some
Member States have established or are developing other control mechanisms. These
include:
o satellite remote sensing (see Box 1);
o mandatory accreditation of drilling companies for new groundwater abstraction.
Drilling companies in Belgium (Flanders) must provide regular reports on drilling
operations and inform the authorities in advance of the start date to allow checks
during construction. Non-compliance may result in the suspension or withdrawal
of accreditation;
o regular checks on the correct functioning of flow meters for groundwater
abstraction facilities in Belgium (Flanders). Metered values are compared against
farm data and the annual declaration of groundwater extraction.
Box 1
Use of satellite images to detect illegal water use
Several research projects (DIANA, IPSTERS, WODA) have looked into the potential
of satellite images to detect unauthorised water abstraction. The results show that
it is feasible to:
— identify local or regional soil subsidence (vertical soil movements) with
millimetre accuracy using radar images (e.g. from Copernicus Sentinel 1),
which can indicate groundwater over-abstraction across a given area;
— identify irrigated areas, estimate abstracted volumes for irrigation and
improve water management policies and practices, especially in extreme
conditions such as drought, using optical remote sensing images (e.g. from
Copernicus Sentinel 2).
The projects encompassed pilot studies in Spain, Italy, Romania and Malta and
resulted in commercial platforms in Italy and Spain proposing services to water
use associations and farmers. The uptake of services depends not only on easy
access to comprehensive auxiliary data that is digital, geo-referenced and
validated, but also on the absence of legal barriers to using earth observation as a
detection method or metering device.
23
The La Mancha Oriental aquifer in Spain is a good example of a long-lasting
operational system of self-regulation. The local irrigation board monitors and
manages groundwater abstraction using satellite data in combination with flow
meters on the ground.
34 In some Member States, practical difficulties make the systems in place for
combating illegal water use less effective. Belgium (Flanders) and Bulgaria reported
that they were unable to deploy their respective systems as intended due to staff
shortages. In Cyprus, until October 2020, the authorities rarely imposed penalties or
sanctions, since those at fault had two months to comply and submit an amended
licence. Bulgaria and Hungary have repeatedly extended their deadlines for making
illegal abstractions compliant without a fine.
35 Regional authorities in the two Spanish regions we examined (Andalusia and
Castile-La Mancha) did not provide us with any information on whether or how they
detect and sanction illegal water use.
Member States have introduced incentivising pricing mechanisms, but
cost recovery is lower in agriculture than in other sectors
36 The WFD requires Member States to embrace the principle of cost recovery for
water services in accordance with the polluter pays principle. This means applying
incentivising pricing policies and ensuring that all categories of water users (industry,
households, agriculture, etc.) contribute adequately to cost recovery.
Incentivising pricing
37 Several Member States/regions have introduced pricing mechanisms that
incentivise efficient water use. Some of these mechanisms apply only to agriculture
and others to all water users. For example:
o Germany (Berlin-Brandenburg), Hungary and Portugal apply a water resource tax
based on the measured volume of use;
o Cyprus imposes a surcharge for every cubic metre of water used beyond the
authorised volume;
o Italy (Emilia-Romagna) is planning a system of variable water prices according to
the efficiency of the irrigation system;
24
o Bulgaria charges more for water used beyond a certain fixed volume for a given
crop;
o Belgium (Flanders) uses progressive pricing for certain types of groundwater (the
greater the volume abstracted, the higher the price).
38 Other Member States/regions have introduced price differentiation to
discourage/encourage the use of water from various sources. For example:
o prices are higher in areas where water is scarcer or under greater quantitative
pressure in Belgium (Flanders), France (Centre-Val de Loire), Hungary and
Portugal;
o groundwater is more expensive than surface water in Bulgaria, Germany (Berlin-
Brandenburg) and France (Centre-Val de Loire);
o fresh water is more expensive than recycled water in Cyprus.
39 Member States use a variety of methods to measure water used for agriculture
(see Figure 9). Volumetric pricing at an appropriate level can incentivise the shift to
water-efficient irrigation technologies and practices or to crops requiring less water.
Spain (Andalusia and Castile-La Mancha) bills most irrigation water on the basis of the
irrigated area, while in Italy (Emilia-Romagna) the charge for irrigation water usually
depends on pumping capacity.
Figure 9 – Billing methods: water for irrigation
Source: ECA.
Water is billed by
volume. The volume of
abstracted water is
measured by means of
a flow meter installed
at the abstraction point
(e.g. groundwater
well).
Volume
Farmers pay a price
per hectare,
regardless of their
actual water use. This
sometimes depends
on the crop grown.
Area
The water price
depends on the
maximum capacity of
the pumping
installation
(e.g. expressed in
kW/h or l/h).
Capacity
25
Lower water prices for agriculture
40 In eight of the 11 Member States/regions covered in our audit, water is
significantly cheaper if used for agriculture. Figure 10 compares some water
abstraction fees for agricultural use with the fees charged for use in other sectors.
Several Member States/regions apply specific derogations for irrigation water (see
Figure 11).
Figure 10 – Comparison of water abstraction fees by sector
Source: ECA, based on information provided by the Member States.
France (Centre-Val de Loire)
In the Loire-Bretagne river basin,
the fee for water abstraction for
irrigation (except gravity
irrigation) in water stressed
areas is set at 0.0213 €/m
3
. This
is:
•
2 times lower than for
drinking water supply
• 1.5 times lower than for
other
economic uses
•
6.7 times higher than for
industrial cooling
Italy (Emilia-Romagna)
Water abstraction fees for
irrigation are slightly below € 50
per module. This is:
• 308.5 times lower than for
industrial use
• 42.6 times lower than for
drinking water
• 9.8 times lower than for
aquaculture
One module is 100 liter per
second for drinking water and
aquaculture and 3 000 000 m³
for industrial use.
Portugal (Mainland)
The water abstraction
component of the water
resource tax has a basic unit
value for agriculture of 0.0032
€/m
3
. This is:
• 4.7 times lower than for
public water supply
• 4.4 times lower than for
other uses
• 1.2 times higher than for
thermoelectric energy
• 160 times higher than for
hydroelectric energy
26
Figure 11 – Price reductions applicable to irrigation water
Source: ECA based on information provided by the Member States.
41 Six of the Member States/regions do not require any payment for water
abstraction up to a certain volume. The pricing threshold varies. It is 500 m³/year in
Belgium (Flanders) and Hungary, 10 m³/day in Bulgaria, 7 000 m³/year in Spain
(Andalusia) and France (water-stressed areas), 10 000 m³/year in France (outside
water-stressed areas), and 16 600 m³/year in Portugal (private abstraction). In every
case it applies to all users, not only farmers.
Hungary
Tax exemption:
• 400 000 m
3
/year per water rights
licence
• 4 000 m
3
/ha/year for individual users
• 25 000 m
3
/ha/year for rice production
using surface water
Additional exemptions during persistent
water scarcity and COVID-19 pandemic.
Germany (Berlin-Brandenburg)
Tax exemption:
• surface water
abstraction for irrigation
(a significant proportion
of irrigation water)
Belgium (Flanders)
Tax exemption:
• 50 % of phreatic
groundwater for
irrigation (by
volume)
Portugal (Mainland)
90 % reduction:
• two out of five components of water resource
tax if the water is used for thermal regulation
of crops (e.g. water for flooding rice crops)
Spain (Andalusia and Castile-La Mancha)
No fee:
• groundwater or surface water for irrigation
when abstracted by farmers for their own use
(and not supplied by a consortium)
27
Cost recovery of water services
42 The WFD requires Member States to carry out an economic analysis of water use.
This calculation should help with assessing the extent to which the costs of water
services (e.g. water abstraction for irrigation) are paid by users (the cost recovery
principle). According to the EU guidance
25
, Member States should consider including
the following in the economic analysis:
(1) The financial costs of providing and administering water services:
o operating and maintenance costs (e.g. energy);
o capital costs (e.g. infrastructure depreciation);
o administrative costs (billing, administration and monitoring).
(2) The environmental and resource costs of water services:
o environmental damage due to abstraction, storage and impoundment;
o opportunity costs of alternative water uses (e.g. costs relating to groundwater
over-abstraction), as current and future users will suffer if water resources are
depleted.
43 In their economic analyses, several Member States/regions assess the
environmental costs by estimating the cost of the measures needed to achieve good
water status throughout a river basin district The authorities in Italy (Emilia-Romagna)
and Spain (Andalusia and Castile-La Mancha) consider resource costs relevant only if
they assess water to be scarce. The authorities of Bulgaria and Germany (Berlin-
Brandenburg) comment that there is still no common agreement on the methodology
for calculating environmental and resource costs.
25
European Commission, Common Implementation Strategy for the Water Framework
Directive, “Guidance document no. 1 Economics and the environment” and “Information
Sheet on Assessment of the Recovery of Costs for Water Services for the 2004 River Basin
Characterisation Report (Art 9)”.
28
44 Eight of the national and regional authorities of the Member States covered in
our audit considered that cost recovery for water services in agriculture is incomplete.
One element in this is that environmental and resource costs are not (yet) reflected in
water pricing. The Commission pointed out in its WFD fitness check (see paragraph 11)
that this represents a hidden cost to society and puts a strain on a potential source of
revenue for financing measures to implement the WFD.
The Commission considers WFD implementation to be progressing
slowly
45 The Commission is required to monitor how Member States implement the WFD.
To this end, it assesses the progress of implementation (see paragraph 09) every three
years, mainly relying on Member States’ reports, and publishes its own
implementation report. The most recent Commission report (February 2019) covered
the second round of RBMPs and contained an EU-wide overview and country-specific
assessments with recommendations.
Prior authorisation systems
46 A Commission staff working document
26
reported progress in the creation and
operation of prior authorisation systems, such as improvements in metering, water
abstraction controls, licenses and water abstraction datasets. However, as our
observations confirm (paragraphs 29-30), the staff working document concluded that
“more progress is needed especially in those Member States in which small
abstractions are exempted from controls and/or register, but water bodies are
suffering from significant water abstraction pressures and therefore do not achieve
good status”. The document concluded that there had been little progress in improving
status due to reducing abstraction pressures since the first round of RBMPs, but that
total water abstraction had decreased by around 7 % between 2002 and 2014.
26
European Commission, SWD(2019) 30 final.
29
Water pricing and cost recovery
47 In the 2014-2020 programming period, the Common Provisions Regulation
27
introduced a mechanism known as “ex-ante conditionality” for several EU funds,
including the rural development fund. If any ex-ante condition was not fulfilled by
30 June 2017, the Commission had the option of suspending interim payments to the
relevant RDP priority pending corrective action.
48 One such condition concerns the water sector. In practice, the financing of
irrigation investments programmed in focus area 5(a) “increasing efficiency in water
use by agriculture” depends on the Member State or region having a water pricing
policy that:
(a) provides adequate incentives for users to use water efficiently; and
(b) takes cost recovery for water services into account.
49 Overall, the Commission considers that the ex-ante conditionality mechanism
was an effective way of inducing Member States to upgrade their water pricing
policies
28
: “Steps were made in defining water services, calculating financial costs,
metering, performing economic analysis and assessing both environmental and
resource costs”. At the same time, the Commission acknowledges that cost recovery
for water services is incomplete in most Member States.
50 Despite the positive impact of the ex-ante conditionality for the water sector
during 2014-2020, the ex-ante conditionality mechanism did not appear in the
Commission’s proposal for the post-2020 CAP.
27
Regulation (EU) No 1303/2013 of the European Parliament and of the Council of 17
December 2013 laying down common provisions on the European Regional Development
Fund, the European Social Fund, the Cohesion Fund, the European Agricultural Fund for
Rural Development and the European Maritime and Fisheries Fund and laying down general
provisions on the European Regional Development Fund, the European Social Fund, the
Cohesion Fund and the European Maritime and Fisheries Fund and repealing Council
Regulation (EC) No 1083/2006 (OJ L 347, 20.12.2013, p. 320).
28
Report from the Commission to the European Parliament and the Council on the
implementation of the Water Framework Directive (2000/60/EC) and the Floods Directive
(2007/60/EC), COM(2019) 95 final.
30
Compliance with the WFD
51 If the Commission considers that a Member State does not comply with the WFD
obligations, it can bring an infringement procedure against the Member State in the EU
Court of Justice. In case C-525/12
29
, the Court found that Member States are free to
determine the mix of policies and the funding that are needed to achieve the WFD
objectives. In accordance with its general policy on infringements, the Commission
now prioritises structural rather than individual cases of non-compliance.
52 The Commission recently decided to address specific points requiring attention in
letters to all Member States. Between September 2020 and April 2021, it sent letters
following up on its assessment of the information reported in the second round of
RBMPs. In those letters it identified apparent instances of non-compliance and asked
the Member States to justify those issues, rectify them or clarify how they had already
been addressed or would be addressed in the third round of RBMPs. In December
2020, the Commission sent another set of letters to all Member States in which it
specifically addressed their mechanisms for compliance assurance and penalties in the
field of abstraction and point source / diffuse pollution. The Member States were
asked to provide details of their domestic rules on water abstraction under
Article 11(3)(e) WFD.
CAP direct payments do not significantly encourage efficient
water use
53 According to the Treaty on the Functioning of the European Union,
“environmental protection requirements must be integrated into the definition and
implementation of the Union policies and activities, in particular with a view to
promoting sustainable development”. We therefore checked whether the EU’s water
policy objectives were reflected in the main CAP funding instruments.
54 Both decoupled (income support) and coupled (area-based) schemes assign aid
on the basis of the area farmed. We assessed whether:
(1) these support payments were conditional on sustainable water use; and
(2) they were an incentive or a disincentive to irrigate.
29
Judgement of the European Court of Justice of 11 September 2014 in Case C-525/12.
31
CAP income support does not promote efficient water use or water
retention
55 Payments under both the SAPS and the BPS are currently neutral on irrigation:
they neither provide an incentive to use water efficiently, nor to irrigate or use more
water. The SAPS payment rate per hectare is identical for all beneficiaries and crop
types within each of the ten Member States that apply the SAPS. The BPS payment
rate is set by the Member States and may vary between beneficiaries, partly
depending on their CAP payment history. In some Member States (e.g. Spain and
Greece) it may also vary by type of agricultural land. The ECA has previously reported
30
on the significant differences that persist in certain Member States, such as Spain.
56 Neither of these two direct payment schemes, nor the Greening Payment scheme
imposes obligations on farmers regarding sustainable water use. Greening may,
however, have indirect positive effects through the requirement for farmers to
preserve permanent grassland (which, unlike arable land, is not normally irrigated). It
also focuses on the conservation of terraces, other landscape features, and ecological
focus areas such as uncultivated buffer strips, all of which can increase natural water
retention. In practice, as we reported in 2017
31
, greening led to changes in farming
practices on only around 5 % of all EU farmland.
57 CAP support incentivises the drainage of fields rather than water retention. The
2014-2020 CAP makes drained peatlands eligible for income support, whereas
inspections sometimes consider farmed wet peatlands to be ineligible. Apart from
having a negative impact on groundwater reserves, draining peatland releases
greenhouse gases
32
. The European Parliament’s amendments to the Commission’s
post-2020 CAP proposal
33
take into account paludiculture (farming and forestry on wet
30
ECA special report 10/2018: “Basic Payment Scheme for farmers – operationally on track,
but limited impact on simplification, targeting and the convergence of aid levels”.
31
ECA special report 21/2017: “Greening: a more complex income support scheme, not yet
environmentally effective”.
32
Peatlands in the EU - position paper.
33
Amendments adopted by the European Parliament on 23 October 2020 on the proposal for
a regulation of the European Parliament and of the Council establishing rules on support for
strategic plans.
32
soils, predominantly peatlands) as an eligible agricultural activity for CAP income
support.
The EU supports water-intensive crops in water-stressed areas through
voluntary coupled support
58 VCS is used by all Member States except Germany to maintain or increase
production of certain crops from sectors in difficulties
34
. The EU restricts support to
specific sectors
35
, including water intensive crops such as rice, nuts, and fruit and
vegetables (see Figure 12).
Figure 12 – Notified VCS measures for crops (2020)
Source: European Commission.
34
European Commission, “Voluntary coupled support - Review by the Member States of their
support decisions applicable as from claim year 2020”.
35
Regulation (EU) No 1307/2013, Article 52.2.
* Amounts budgeted by Member States for 2020,
not actual final payments
4 160
2 068
887
720
508
470
447
198
476
115
67
189
182
69
18
32
0
100
200
300
400
500
600
0
500
1000
1500
2000
2500
3000
3500
4000
4500
Protein crops Cereals Olive oil Fruit and
vegetables
Sugar beet Rice Nuts Other crops
Fixed number of hectares
(x 1 000)
Aid earmarked for 2020*
(million euros)
Water-intensive crops
33
59 The EU’s rules on VCS state that “any coupled support granted (…) shall be
consistent with other Union measures and policies”
36
, which should allow the
Commission to reject incompatible schemes. The Commission has not assessed the
impact of proposed measures on sustainable water use.
60 None of the Member States/regions we reviewed had introduced safeguards on
water use, such as restrictions on support in water-stressed areas or for parcels
without efficient irrigation systems.
61 Nine of the eleven Member States/regions covered in our audit use VCS for crops.
Eight support water-intensive crops without geographical restriction. As a result,
Member States use EU funds to support water-intensive crops in water-stressed areas.
Figure 13 shows that six Member States use VCS for water-intensive crops in areas
with high or very high levels of water stress.
36
Regulation (EU) No 1307/2013, Article 52.8.
34
Figure 13 – VCS for water-intensive crops and areas under water stress
Source: ECA and World Resources Institute Aqueduct, accessed on 22/03/2021.
Low
(< 10 %)
Low-medium
(10-20 %)
Medium-high
(20-40 %)
High
(40-80 %)
Very high
(> 80 %)
Water stress baseline
(ratio of total water withdrawals
to available renewable surface
and groundwater supplies)
* VCS for water intensive crops only. Based on the analysis of data from several sources, we considered the following crops to
be water intensive: fruit and vegetables, rice, and nuts.
Disclaimer: due to differences in the source data, the maps are not comparable between countries.
VCS* claimed area (ha) by
municipality (2019)
Italy
(Emilia-Romagna)
1 – 100 100 - 200 > 200
Hungary
Agricultural parcels claiming
VCS* (2019)
Location of agricultural parcels
VCS* paid (million euro) by
province (2019)
Spain
(Andalusia and Castile
-La Mancha)
0-1 1-5 > 5
VCS* claimed area (ha) by
municipality (2019)
Portugal
(Mainland)
1 – 1 000 1 000-2 500
> 2 500
Agricultural parcels claiming VCS*
(2019)
Location of agricultural parcels
Greece
(Thessaly)
Agricultural parcels claiming
VCS* (2019)
Location of agricultural parcels
Cyprus
35
Cross-compliance covers illegal abstraction of water, but checks are
infrequent and penalties are low
62 Cross-compliance ties direct payments (and some other CAP payments) to certain
environmental obligations. One of the cross-compliance conditions (GAEC 2) covers
water abstraction authorisation procedures set by the Member States.
National/regional authorities check 1 % of specified groups of farmers who irrigate
their fields, and impose penalties (typically a 3 % reduction in their subsidy under BPS
or SAPS) for those who do not comply with national/regional water abstraction
authorisation procedures
63 In practice, arrangements have changed little since we reported on this in 2014
37
.
GAEC 2 is worded generically: “Where use of water for irrigation is subject to
authorisation, compliance with authorisation procedures”. The Commission did not ask
Member States to impose specific requirements, such as installing water meters and
reporting on water use. The GAEC will have no impact in Member States with weak
authorisation procedures. The fact that it does not apply to all CAP beneficiaries (e.g.
beneficiaries of the small farmers scheme, non-annual rural development payments or
CMO aid for the fruit and vegetable or olive sectors), and that Member States do not
carry out proper checks, further reduces its potential.
64 The Commission’s proposal for the post-2020 CAP continues with the concept of
cross-compliance (now re-named “conditionality”). It expands coverage to the small
farmers scheme, but simultaneously excludes beneficiaries of CMO wine payments.
65 Under the principle of subsidiarity, Member States are free to implement and
enforce the water authorisation obligation as they see fit. Ten of the Member
States/regions covered in our audit take a selective approach towards GAEC 2, often
omitting certain national or regional regulatory requirements for water abstraction in
their checks (Figure 14).
37
ECA special report 04/2014, “Integration of EU water policy objectives with the CAP: a
partial success”, paragraphs 38-48.
36
66 The only check common to all control systems we examined is on the need for
authorisation to abstract irrigation water. In most cases, inspections also include a
visual check of parcels to detect illegal abstraction or irrigation. This applies to Belgium
(Flanders), Germany (Berlin-Brandenburg), Spain (Andalusia and Castile-La Mancha),
Italy (Emilia-Romagna), Hungary and Portugal. Three of the eleven Member States and
regions check for the presence of meters - Belgium (Flanders), France (Centre-Val de
Loire), Cyprus. Ten of the 11 did not check the content of authorisations, such as
maximum abstraction volume and time of irrigation (all Member States/regions
covered in our audit except Belgium (Flanders)). A similar weakness is reported in the
evaluation support study on the impact of the CAP on water.
38
Figure 14 – GAEC 2 components checked in 11 Member States/regions
Source: ECA.
67 The cross-compliance control statistics which Member States report to the
Commission show significant differences both between countries and between
regions. In Spain, for example, the average non-compliance rate is significantly higher
for Castile-La Mancha than for Andalusia (Figure 15). In all the Member States/regions
for which we obtained data, the GAEC 2 non-compliance rate is lower than the rate for
other water abstraction checks as described in paragraph 32 (see Figure 15). There is a
significant risk that cross-compliance checks do not detect cases of illegal water
abstraction.
38
DG AGRI and EEIG Alliance Environnement, “Evaluation of the impact of the CAP on water.
Final report”.
Note: Each circle represents one
Member State/region
GAEC 2
Existence of authorisation
Presence of a water meter
Additional restrictions
(e.g. max abstraction volume, time of irrigation)
Requirement exists and is
checked
Requirement exists but no
indication that it is checked
Requirement does not exist
37
Figure 15 – Non-compliance rates revealed by GAEC2 checks and other
water abstraction checks in 11 Member States/regions
Source: ECA.
68 In 2013, the European Parliament and Council called on the Commission
39
to
monitor the Member States’ transposition of the WFD into national law, and its
implementation, and to present a proposal for including relevant parts of the WFD in
cross-compliance. The Commission did not make a proposal on including any parts of
the WFD in the 2014-2020 cross-compliance framework. However, the proposal for the
post-2020 CAP does explicitly refer to the WFD article on controls over water
abstraction
40
, making them a mandatory requirement (SMR1) under the new
conditionality rules. This introduces a clear link between the WFD and CAP payments
to farmers and could lend the article greater force.
39
Regulation (EU) No 1306/2013 of the European Parliament and of the Council of
17 December 2013 on the financing, management and monitoring of the common
agricultural policy (OJ L 347, 20.12.2013, pp. 549-607), Joint statement by the European
Parliament and the Council on cross-compliance.
40
Directive 2000/60/EC, Article 11.3(e).
0.4 %
4.1 %
13.6 %
6.4 %
6.6 %
0.4 %
3.5 %
8.0 %
6.5 %
22.3 %
1.6 %
13.3 %
0,0 %
10.8 %
0.6 %
1.0 %
Not available
Not available
Not available
Not available
Not available
Not available
Belgium
(Flanders)
Bulgaria
Cyprus
Germany
(Berlin-
Brandenburg)
Greece*
(Thessaly)
Spain
(Andalusia)
Spain
(Castile-
La Mancha)
France*
(Centre-
Val de Loire)
Hungary
Italy
(Emilia-
Romagna)
Portugal
(Mainland)
Infringements revealed by other
water abstraction checks
Infringements revealed by GAEC 2 checks
(average 2014 – 2018)
* Cross-compliance results are for the whole country, the results on other infringements for the region
Other water abstraction checks may include economic sectors other than agriculture
38
Rural development funds and market measures do not
significantly promote sustainable water use
69 Apart from direct payments, the CAP also funds farmers’ investments in fixed
assets and supports specific actions, such as a commitment to certain agricultural
practices. Some investments and actions have a positive impact on water use, while
others increase water use (see also Figure 16). Funding for farm advisory systems or
cooperation projects may also have an impact on water use, though indirectly.
Figure 16 – Agricultural practices and investments that affect water use
Source: ECA.
Rural development programmes are seldom used to improve water
quantity
70 Through rural development programmes national or regional authorities can
support:
(a) agricultural practices or green infrastructure with a positive effect on water
availability in agricultural soils (water retention measures);
(b) farmers for the additional costs and lost income stemming from implementing
WFD requirements;
(c) waste water treatment infrastructure for water reuse in irrigation.
Reuse of wastewater
for irrigation
Newly irrigated area
e.g. with sprinkler
irrigation
Switch to more efficient
irrigation systems
e.g. drip irrigation
Natural water
retention measures
e.g. strip cropping
along contours
Water reservoir
Small scale
water infrastructure
e.g. controllable weirs or
a wetland
39
We examined the extent to which these options are used.
71 Member States can use rural development funds to finance natural water
retention measures (see Figure 17). Five of the Member States/regions covered in our
audit take advantage of this opportunity:
o Belgium (Flanders), Spain (Andalusia), Hungary, Italy (Emilia-Romagna) and
Portugal have funded agri-environment-climate commitments
41
whose main
purpose is to conserve soil, build up organic matter and reduce erosion, thereby
helping to increase water retention.
o Belgium (Flanders) has financed one project concerning green infrastructure for
water retention
42
, and Hungary eight projects.
41
Regulation (EU) No 1305/2013 of the European Parliament and of the Council of
17 December 2013 on support for rural development by the European Agricultural Fund for
Rural Development (EAFRD) (OJ L 347, 20.12.2013, p. 487), Article 28.
42
Regulation (EU) No 1305/2013, Article 17.1(d).
40
Figure 17 – Natural water retention measures
Source: ECA, based on the EU catalogue of natural water retention measures.
72 Natural water retention measures may deliver multiple benefits, including
groundwater recharge, drought management and flood risk reduction, but their
effectiveness is limited if they are used in a small area
43
. Seven of the eleven Member
States/regions covered in our audit do not finance such measures through rural
development measures (see also Figure 18).
73 Member States can use rural development funds
44
to compensate farmers for
the additional costs and lost income resulting from requirements in a river basin
management plan. None of the Member States/regions covered in our audit used this
option.
43
EEA Report No 17/2020, p. 68.
44
Regulation (EU) No 1305/2013, Article 30.
Wetland restoration
Wetlands function as natural tubs or sponges,
storing water and slowly releasing it.
Re-naturalisation and stabilisation of river banks
Increases the potential for soil water retention,
since there is increased potential for infiltration to
the banks.
Water retention
measures at the
level of the
water body can
also increase
water availability
in surrounding
agricultural
areas.
Buffer strips and hedges
Due to their permanent vegetation, hedges and grass
buffer strips at the margin of fields or watercourses
offer good conditions for effective water infiltration and
slowing surface flow.
Conservation tillage
By leaving crop residue on the surface, conservation
tillage slows water movement and reduces soil erosion.
On
agricultural
soils, water
retention can
be improved
for example
through:
Natural water retention measures have the primary function of enhancing and/or restoring the
water retention capacity of aquifers, soils and ecosystems. This can be done in many ways.
41
74 National/regional authorities can include support for investments in
infrastructure for reusing wastewater for irrigation in their RDPs
45
. Five of the
Member States/regions we examined did not include the option in their RDPs. In three
Member States/regions it is included as part of a sub-measure but has not been used
to finance any projects. Two Member States have financed relevant projects (see
Box 2).
Box 2
Rural development funded investments in wastewater reuse
In Cyprus, rural development funds were used to finance one large project, which
involves building a 500 000 m³ water tank to store excess recycled water for use in
agriculture during the summer, as well as a 20 km primary and secondary distribution
network covering 1 700 hectares.
In Belgium (Flanders), rural development funds supported several projects for the
treatment of wastewater for irrigation or watering livestock. Two examples:
— water purification equipment at a tomato grower to disinfect the processed
water and remove pesticide residue;
— a purification plant to convert wastewater from a dairy processing company
into drinking water for cattle and liquid digestate from a dairy farm into
irrigation water.
EU funding for irrigation projects has weak safeguards against
unsustainable water use
75 Various forms of EU funding are available to finance irrigation projects. Member
States can use rural development funds for investments in physical assets, or CMO
support in certain sectors (fruit and vegetables, olives and olive oil, wine), to finance
the modernisation or first installation of irrigation equipment (e.g. on farms) or
infrastructure (e.g. networks).
76 We examined:
(1) the extent to which these funds are used to support irrigation projects;
45
Regulation (EU) No 1305/2013, Article 17.
42
(2) whether the Commission and Member States have defined safeguards against
unsustainable water use; and
(3) whether Member States have checked the respective requirements.
77 Modernising existing irrigation systems may increase water use efficiency, for
example by repairing leaking channels, covering open channels to reduce evaporation
or switching to more efficient irrigation systems. However, efficiency improvements do
not always result in overall water savings, since the saved water may be redirected to
other uses, such as more water-intensive crops or irrigation across a wider area. This is
known as the rebound effect
46
. In addition, in a phenomenon known as the
“hydrological paradox”, increased irrigation efficiency may reduce the return of
surface water to rivers, decreasing base flows that are beneficial to downstream users
and sensitive ecosystems
47
.
78 Installing new irrigation infrastructure that extends the irrigated area, is likely to
increase the pressure on freshwater resources unless the system uses rainwater or
recycled water. The Commission evaluation support study on the impact of the CAP on
water (see footnote 38) confirmed this risk: “to date, it is difficult to guarantee that
investments in irrigation are beneficial to water bodies, especially if the irrigated area
increases where water bodies are under stress.”
Rural development investment support
79 All but one of the Member States/regions we assessed use the rural development
funds to finance investments with an impact on water use (see Figure 18). New
irrigation installations and infrastructure are eligible in all ten of the Member
States/regions, and investments in abstraction infrastructure (e.g. wells) are eligible in
at least three. Half of the 24 RDPs in our additional sample allowed investment in new
irrigation infrastructure.
46
OECD (2016), Mitigating Droughts and Floods in Agriculture: Policy Lessons and
Approaches, OECD Studies on Water, OECD Publishing, Paris.
47
EEA Report No 17/2020.
43
Figure 18 – EAFRD funding with an impact on water use in agriculture
(funds committed or paid in million euros) (2014-2020)
Source: ECA, based on data received from the Member States.
80 EAFRD support for investments in irrigation is subject to conditions set out in the
EU rules
48
(see Figure 19). Member States can also establish additional requirements.
For certain investments, three Member States/regions covered in our audit require
potential water savings beyond 5 %. For new irrigation infrastructure, five Member
States/regions require proof of title to the land and/or a valid water abstraction
authorisation.
48
Regulation (EU) No 1305/2013, Article 46.
402
122
83
65
20
5 3 2 2
Portugal
(Mainland)
Italy
(Emilia
-Romagna)
Greece
(Thessaly)
Spain
(Andalusia)
Hungary Cyprus
Belgium
(Flanders)
Germany
(Berlin-
Brandenburg)
Spain
(Castile-
La Mancha)
127
109
59
21
19
(a)
(e)
(d)
(b)
(a) all public support; (b) only partly corresponds to irrigated crops; (c) only partly corresponds to measures with an impact on
water use; (d) total expenditure declared for 2014-2020; (e) amount paid for claim year 2018; (f) only Natura2000 payments for
not draining and not irrigating grasslands.
Investment related to water use (measure 04)
Agri-environment-climate (measure 10)
20
(e)(f)
WFD and Natura 2000 payments (measure 12)
Bulgaria
55
(c)
44
Figure 19 – Conditions for irrigation projects under rural development
Source: ECA, based on Article 46 of Regulation 1305/2013.
81 Some of the requirements described in Figure 19 are not explained further in the
legal texts. For example, the WFD does not define what is meant by the quantitative
status of surface water bodies. The Member States therefore need to define what they
consider to be “less than good” status for quantitative reasons’ in the case of surface
water bodies. In eight of the Member States/regions we covered in our audit, it is
unclear how, and indeed whether, this is defined. The Commission has provided non-
Investments in irrigation
Does the investment increase the irrigated area?
Yes No
Yes No
No further conditions
apply
Does the investment affect a water body with
less than good status for quantitative reasons?
Eligibility requirement
Existence of a river basin management plan
Eligibility requirement
Water metering already in place or included in
the investment
Eligibility requirement
Eligibility requirement
Actual reduction in
water use of at least
50 % of the potential
water saving
Eligibility requirement
Environmental
analysis shows no
significant impact
from the investment
Does the investment only affect the energy
efficiency of existing installations, the creation
of a reservoir or the use of recycled
water?
Yes
No further conditions
apply
Does the investment affect a water body with
less than good status for quantitative reasons?
Potential (ex-ante) water savings of at least
5-25 % (percentage fixed by the Member State)
No
No Yes
Support not
permitted unless
derogations apply
Derogations:
• Investment is combined with improvements to
existing irrigations systems, potentially
delivering water savings of at least 5-25 %, and
an actual reduction of at least 50 % of the
potential, for the investment as a whole.
• Irrigation water comes from a reservoir
approved before 31 October 2013 and meeting
certain other conditions.
45
binding guidance on this issue
49
. Member States also interpret differently what is an
extension of irrigation area, as they may include areas that were irrigated in the recent
past as irrigated area. Some consider the “recent past” as up to five years ago, while
others interpreted it as going back to 2004.
82 As the EU rules allow for multiple possible interpretations and exemptions (see
Figure 19), there is a risk that the EU is funding irrigation projects that go against the
WFD objectives. For the post-2020 CAP the Commission proposed some simplification
of the conditions for financing irrigation projects. Investments in irrigation would be
explicitly excluded from financing if not consistent with achieving the WFD objectives
of reaching good status. Expanding irrigated area would not be eligible if the irrigation
affects water bodies whose status has been defined as less than good
50
. It would be up
to the Member States to transpose this into their eligibility conditions.
83 Compliance with the conditions in Figure 19 is not checked thoroughly. Eight of
the Member States/regions we assessed state that they check the basic requirements
(such as the need for water metering and potential water savings) on the basis of the
project application or ex post. Seven Member States/regions provided documentary
evidence of ex-post checks of actual water savings. In four cases it was unclear from
the documents how the increase in irrigated area is assessed. We asked two Member
States/regions for more detailed project information. From the documentation we
received in reply, it was sometimes unclear how the requirements were checked: we
found no evidence at all for some checks, including basic verifications of water
metering or potential water savings.
49
Guidance document. Support through the EAFRD for investments in irrigation (version:
November 2014).
50
COM(2018) 392 final, Article 68.3(f).
46
Common organisation of markets
84 The EU also finances irrigation infrastructure through the CMO for three sectors:
fruit and vegetables, olives and olive oil, and wine. The fruit and vegetables sector
receives support for irrigation infrastructure in ten of the 11 Member States/regions
covered in our audit, the olives and olive oil sector in two and the wine sector in three.
All the Member States/regions offer support both for new infrastructure and for the
modernisation of existing systems – except for the olives and olive oil sector, where
only improvements are eligible for EU support. The rules applicable to investments
funded under a CMO differ from those applicable under rural development.
85 In recent years, funding for irrigation projects in the fruit and vegetables sector
has been highest in Spain (Andalusia) and Portugal (see Figure 20). France and Cyprus
have seen little or no uptake of the available measures. In Italy (Emilia-Romagna), the
authorities were unable to provide data on irrigation projects and the related funding,
checks and sanctions.
Figure 20 – Estimated average annual EU funding for irrigation projects
under a CMO (in thousand euros)
Source: ECA, based on data from the Member State authorities.
251
Bulgaria*
4 554
1 512
147
93
32 24
* Data concerns support for the wine sector
Portugal
(Mainland)
179
Greece
(Thessaly)
Spain
(Andalusia)
Hungary
Belgium
(Flanders)
Germany
(Berlin-
Brandenburg)
Spain
(Castile-
La Mancha)
47
86 Investments to reduce water use in the fruit and vegetables sector, if funded
under the heading “Investments beneficial for the environment”
51
, should:
o reduce water consumption by at least 5 % if using drip irrigation or similar
systems;
o not result in a net increase in the irrigation area unless total water consumption
for irrigation on the whole farm, even after extending the area, remains below
the average figure during the five years before the investment.
87 Irrigation infrastructure can also be funded under other headings, such as
“Production planning”. Where this is the case, the EU rules do not require any
safeguards against unsustainable water use as they do for EAFRD funding (see
paragraph 80). In Spain (Andalusia), 98 % of expenditure in 2018 for actions relating to
irrigation and sustainable water use concerned production planning projects. Three of
the 11 Member States we assessed went beyond the EU rules and set additional
requirements for some or all irrigation projects (Figure 21).
51
In line with Article 3(4), final paragraph, of Commission Implementing Regulation (EU)
2017/892 of 13 March 2017 laying down rules for the application of Regulation (EU)
No 1308/2013 of the European Parliament and of the Council with regard to the fruit and
vegetables and processed fruit and vegetables sectors (OJ L 138, 25.5.2017, pp. 57-91).
48
Figure 21 – Examples of additional requirements for CMO-funded
irrigation projects
Source: ECA.
88 Member State authorities do not sufficiently check compliance with the
conditions for investments that will benefit the environment (paragraph 86). Having
reviewed guidelines, administrative checklists and reports from on-the-spot checks, we
found no evidence, in most Member States/regions, of checks for compliance with the
environmental requirements governing CMO funding.
89 Overall, CMO funding for new irrigation infrastructure and improvements to
existing systems comes with fewer environmental safeguards than are offered by the
EAFRD. Certain types of investment are subject to conditions regarding water savings
and the increase in irrigated area, but there are no requirements to have a water
meter installed before or as part of an investment.
Hungary
Projects resulting in a net
increase in irrigated area are
eligible only if the quantitative
status of the water body
concerned is at least classified as
‘good’
Cyprus
• Potential water saving must
be five percentage points
above that required by the
EU rules (10 % in total)
• A water licence is obligatory
• Water metering must either
be in place already or be
introduced as part of the
investment
France (Centre-Val de Loire)
• Water metering is required
• Investment are refused if
they would lead
to an
increase in water abstraction
on agricultural parcels
located in water-
stressed
areas
• The minimum water saving
must be 25 %
49
Conclusions and recommendations
90 The EU introduced the Water Framework Directive in 2000 with the aim of
making the status of all EU water bodies “good” by 2015 or (with justified exemptions)
2027 at the latest. This included water quantity objectives. Our audit showed that
support for agriculture was not consistently aligned with water policy objectives.
91 While providing for safeguards against unsustainable water use, derogations
under EU water policy frequently apply to agricultural producers. Since 2009, Member
States have made progress in setting up prior authorisation systems for water
abstraction, systems for detecting illegal water use and pricing mechanisms with the
potential to incentivise water efficiency. However:
o there are still many exemptions for farmers for authorisations for water
abstraction in the Member States we examined (including in water-stressed
regions) (paragraphs 27-30); and
o many Member States do not apply the principle of cost recovery for water
services in agriculture as they do in other sectors (paragraphs 36-44).
92 The Commission monitors the Member States’ implementation of the Water
Framework Directive and considers that it could be progressing faster
(paragraphs 45-52).
Recommendation 1 – Request justifications for exemptions to
Water Framework Directive implementation in agriculture
The Commission should:
ask Member States to justify water pricing levels for agriculture and exemptions
from the requirement for prior authorisation for water abstraction and explain
the basis for concluding that these do not have a significant impact on the status
of water bodies.
Timeframe: 2025
93 Common agricultural policy (CAP) direct payment schemes do not impose
obligations directly on farmers regarding sustainable water use. The EU rules on
50
voluntary coupled support allow Member States to fund water-intensive crops in
water-stressed regions without any checks or environmental safeguards. The ex-ante
conditionality on the water sector applicable to rural development funding has
encouraged Member States to upgrade their water pricing policies. However, ex-ante
conditionality looks likely to be discontinued in the post-2020 CAP (paragraphs 47-49
and 53-61).
94 Several Member States use voluntary coupled support to fund water-intensive
crops in water-stressed areas (paragraphs 60-61).
95 The second good agricultural and environmental condition (GAEC 2) of cross-
compliance has the potential to reduce overexploitation of water resources in
agriculture by encouraging farmers to respect Member State water abstraction
authorisation procedures. However, the EU rules do not impose cross-compliance
obligations on all farmers receiving CAP funds, and Member States make relatively
limited use of GAEC 2 to protect water resources. None of the Member States in our
audit carry out comprehensive checks on GAEC 2 requirements (paragraphs 62-68).
Recommendation 2 – Tie CAP payments to compliance with
environmental standards
The Commission should:
(a) make rural development support for investments in irrigation conditional on the
implementation of policies that incentivise sustainable water use in Member
States;
(b) link all CAP payments to farmers, including those made through the Common
market organisation, to explicit environmental requirements on sustainable water
use, including through conditionality;
(c) require safeguards to prevent the unsustainable use of water for crops funded
through voluntary coupled support.
Timeframe: 2023 (start of new CAP period)
96 The Commission has partially incorporated the principles of sustainable water use
into the rules for CAP funding mechanisms, such as rural development and market
support. Rural development funds can finance agricultural practices and infrastructure
51
that improve water quantity. Rural development funding and market support can also
pay for irrigation projects. Payments of this type are linked to certain obligations, but
the EU rules are inconsistent across programmes, allowing various interpretations and
exemptions (paragraphs 69-89).
97 The Member States have partially used rural development and market support to
incentivise sustainable water use in agriculture. We found that:
o Rural development programmes seldom support water retention measures and
water reuse infrastructure (paragraphs 70-72);
o EU funds are used to support new irrigation projects in the Member
States/regions covered in our audit (paragraphs 75-79 and 84-85);
o Member States do not sufficiently check compliance with the environmental
conditions linked to rural development funding and market support (paragraphs
80-83 and 86-89).
98 The Commission’s proposal for the post-2020 CAP would explicitly exclude
financing investments in irrigation that are not consistent with achieving the Water
Framework Directive objectives of reaching good status. Expanding irrigated area
would no longer be eligible when affecting water bodies with less than good status
(paragraph 82).
Recommendation 3 – Use EU funds to improve the quantitative
status of water bodies
The Commission should:
(a) Ensure, when approving the Member State CAP strategic plans, that Member
States apply the post-2020 CAP rules so that funded irrigation projects contribute
to the Water Framework Directive objectives;
(b) evaluate the impact of rural development funding and market support on water
use in the post-2020 CAP.
Timeframe: 2023 (start of new CAP period) and 2026 (interim evaluation)
52
This Report was adopted by Chamber I, headed by Mr Samo Jereb, Member of the
Court of Auditors, in Luxembourg on 14 July 2021.
For the Court of Auditors
Klaus-Heiner Lehne
President
53
Abbreviations
BPS: Basic payment scheme
CAP: Common agricultural policy
CMO: Common market organisation
EAFRD: European Agricultural Fund for Rural Development
EEA: European Environment Agency
GAEC: Good agricultural and environmental condition
OECD: Organisation for Economic Co-operation and Development
RBMP: River basin management plan
RDP: Rural development programme
SAPS: Single area payment scheme
SMR: Statutory management requirement
VCS: Voluntary coupled support
WFD: Water Framework Directive
54
Glossary
Abstraction: Removal or diversion of water from a water environment.
Basic payment scheme: EU agricultural scheme which makes payments to farmers
based on eligible land area.
Convergence: The process of adjusting payment entitlements to farmers to reflect
national or regional averages in order to ensure a fairer distribution of direct
agricultural support.
Copernicus: The EU’s Earth observation and monitoring system, which collects and
processes data from satellites and Earth-based sensors to provide environmental and
security information.
Cost recovery: Principle whereby the user of a service pays for the cost of that service,
and the total revenue to the service provider equals (or exceeds) the cost of supply.
Cross-compliance: A mechanism whereby payments to farmers are dependent on their
meeting requirements on the environment, food safety, animal health and welfare,
and land management.
Decoupled support: EU payments to farmers which are not tied to the production of a
specific product.
Direct payment: An agricultural support payment, such as area-related aid, made
directly to farmers.
Fitness check: An evaluation to identify any overlaps, gaps, inconsistencies or obsolete
measures in the regulatory framework for a policy area.
Good agricultural and environmental condition: The state in which farmers must keep
all agricultural land, especially land not currently used for production, in order to
receive certain payments under the CAP. Includes issues such as water and soil
management.
Greening payment: Area-based payment for agricultural practices that benefit the
environment and climate.
Quantitative status: An expression of the degree to which a body of water is affected,
directly and indirectly, by abstraction.
55
River basin management plan: Document covering the management of a designated
river basin in the EU, setting out the actions planned to meet the objectives of the
Water Framework Directive.
Rural development programme: A set of national or regional multiannual objectives
and actions, approved by the Commission, for the implementation of EU rural
development policy.
Statutory management requirement: An EU or national rule on the management of
farmland to safeguard public, animal and plant health, animal welfare and the
environment.
Voluntary coupled support: Optional way for Member States to make direct EU
agricultural payments, based on production volumes, to farmers that choose to claim
on this basis.
Water body: A lake, reservoir, stream, river or canal, a transitional area of water along
a coastline, a stretch of coastal water, or a distinct volume of groundwater.
Audit team
The ECA’s special reports set out the results of its audits of EU policies and
programmes, or of management-related topics from specific budgetary areas. The ECA
selects and designs these audit tasks to be of maximum impact by considering the risks
to performance or compliance, the level of income or spending involved, forthcoming
developments and political and public interest.
This performance audit was carried out by Audit Chamber I Sustainable use of natural
resources, headed by ECA Member Samo Jereb. The audit was led by ECA Member
Joëlle Elvinger, supported by Ildikó Preiss, Head of Private Office and
Charlotta Törneling, Private Office Attaché; Emmanuel Rauch, Principal Manager;
Els Brems, Head of Task; Paulo Braz, Deputy Head of Task; Greta Kapustaite,
Georgios Karakatsanis, Szilvia Kelemen, Dimitrios Maniopoulos, Dainora Venckeviciene
and Krzysztof Zalega, Auditors. Thomas Everett provided linguistic support.
Marika Meisenzahl provided graphical support.
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ISSN 1977-5679
doi:10.2865/497724
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One fourth of all water abstracted in the EU is used for
agriculture, mainly for irrigation. Many regions are already
affected by water scarcity and climate change is likely to
exacerbate this. The Water Framework Directive sets a target of
good status for all water bodies by 2027 but there are significant
delays in reaching this target. Common agricultural policy (CAP)
support to farmers affects agricultural water use in different
ways. We found that agricultural policies were not consistently
aligned w
ith EU water policy. We recommend that Member States
better justify exemptions to Water Framework Directive
implementation in agriculture and that the Commission links CAP
payments to environmental standards on sustainable water use.
ECA special report pursuant to Article 287(4), second
subparagraph, TFEU.
