The challenge

With a population of around 20 million people, São Paulo is the most populated metropolitan region in Brazil and the sixth largest on the planet. The city is the center of Brazil’s financial, service and industrial sectors, making up more than 20 percent of the country’s GDP. Unfortunately, it is also one of the top water-stressed cities in Latin America.

For decades São Paulo’s most important watersheds—that of the Piracicaba, Capivari and Jundiaí rivers (PCJ) and Upper Tietê River—have experienced severe deforestation, which impacts water availability and contributes to climate change. Already, São Paulo consumes 4 percent more water than is available in its rivers (a deficit of 3,000 liters per second), and by 2025 this is expected to increase by 16 percent if immediate large-scale actions are not taken to address the root causes of the crisis. While investments in traditional gray infrastructure are critical, they are costly and will be more effective with parallel efforts to reduce water use and waste and restore watershed landscapes.

Approximately 46 percent of the water consumed by the São Paulo metropolitan area comes from the Cantareira System, which encompasses four sub watersheds of the Piracicaba River (Jaguari, Jacareí, Cachoeira, Atibainha) and one from the Alto Tietê River (Juqueri), and is one of the largest water supply systems in the world. Comprised of six reservoirs, it sits in the biodiverse and highly threatened Atlantic Forest. The Cantareira System’s watersheds have already lost over 70 percent of their original forest as a result of land-use changes to support agriculture, pasture lands and urban expansion. Restoring natural vegetation in critical areas of the watersheds will not only help filter out sediments and pollutants to improve water quality, but it is expected to contribute to natural flow regulation and improve water availability during the dry season.

SÃO PAULOSÃO PAULO

Cachoeira ReservoirCachoeira Reservoir

Ponte NovaPonte Nova

Guarapiranga ReservoirGuarapiranga Reservoir

ParaitingaParaitinga

Atibainha ReservoirAtibainha Reservoir

JundiaíJundiaí

Billings ReservoirBillings Reservoir

Paiva Castro ReservoirPaiva Castro Reservoir

Jacareí ReservoirJacareí Reservoir

TaiaçupebaTaiaçupeba

Biritiba Mirim Reservoir

Biritiba Mirim Reservoir

Jaguari ReservoirJaguari Reservoir

Pedro Beicht - Cachoeira da Graça Reservoir

Pedro Beicht - Cachoeira da Graça Reservoir

50 km0

Population density

Low High

South America

LOCAL SPOTLIGHTCantareira System, São Paulo, Brazil—Reforestation for water security mitigates climate change

Above: Brazil’s first forest conserved through Payments for Environmental Services in São Paulo’s Cantareira System. Left: Preparing tree seedlings for planting.

Photo: © Adriano Gambarini Photo: © Scott Waren

Action and opportunityBrazil’s water funds—in some cases known as water producer projects—are focused on implementing or maintaining natural infrastructure to ensure water provision for water users. The Nature Conservancy and its partners are promoting this scheme to improve water security for 12 urban centers in the country. One of these sites is São Paulo and its metropolitan area, where early projects started as pilots in 2005. The first pilot project was in Extrema, a municipality that encompasses many of the PCJ headwaters and became a broadly recognized case.

The priority of the São Paulo Water Fund has been to recover the natural functions of the watersheds to improve water security and conserve biodiversity. With the goal of decreasing sedimentation by 50 percent in the Cantareira system, approximately 13,000 hectares were identified for reforestation and natural regeneration, specifically in riparian zones, water recharge areas and steep slopes—all of which would be protected by law for their importance to water quality and for delivering a multitude of other benefits.

The scale at which forests would be restored and protected was substantial enough to explore the addition of climate change mitigation as a co-benefit of the projects in São Paulo. In 2008, the Dow Chemical Company and Foundation supported The Nature Conservancy in a 3-year pilot project with two main goals: to restore 350 hectares in the watershed of the Cachoeira Reservoir, one of the six reservoirs of the Cantareira System; and to develop a forest carbon project that could enable the inclusion of other carbon initiatives throughout the Cantareira system.

In 2012, a contract for Payment for Ecosystem Services for Carbon (PES-Carbon) was signed with a landowner participating in the Extrema Water Conservation Project. This was a pilot and pioneer experience for The Nature Conservancy. The agreement compensated the farmer for both water production and carbon storage. By following the Verified Carbon Standard (VCS) methodology, The Nature Conservancy was able to identify the carbon sequestration rates for reforestation in that particular region: each reforested hectare in the Cantareira System would be able to store around 102 metric tonnes of carbon over 30 years (375 tonnes of carbon dioxide (CO2) equivalent) (Figure 3.7). Considering these

parameters and the plan to scale the São Paulo Water Fund (a target of restoring around 14,200 hectares by 2025), expected additional benefits for climate change mitigation generated by the restoration activities are around 942,500 tonnes of carbon (or 3.46 million tonnes of CO2 equivalent). In the case of the Extrema Water Conserver Project, the carbon sequestration benefits are also being used to engage new partners, such as companies looking to have a sustainable supply chain.

The development of the carbon project was an important step in identifying opportunities to adapt and implement this co-benefit for other water producer projects in Brazil. The benefits of water funds go beyond water security and working with partners reinforces that natural infrastructure can provide benefits for climate change mitigation, biodiversity conservation and local communities.

SÃO PAULO DASHBOARD

Water fund start date

2005*

Number of upstream participants to date

221

Number of potential downstream beneficiaries

More than 5,000,000

Number of partners to date

17

Primary funding sources

PrivatePublic

Activities

Anticipated co-benefits

*2005 is when the first Extrema Conservador das Aguas project started.

Estimated annual net carbon removal potential through forest restoration for the São Paulo Water Fund over 30 years

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20,000

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Figure 3.7. Net carbon removal data within planned restoration sites estimated based on parameters from Borgo and Tiepolo (2012).