Phase 1

Step 1.02.02 , Situation Analysis: Science


(1) clearly delineate the geographic extent of the analysis, including scoping and characterization of source watersheds.

(2) further identify and explore water security issues within each water security dimension that a Water Fund might help to address.

Avg. Time Frame
1 Month (global average)

Key Ideas

  • Priorities for the Science Team in Feasibility

    • Identify water security challenges for each dimension: domestic, urban, economic, environmental, and resilience to water-related natural disasters.
    • Identify the physical setting (boundaries): determine boundaries of municipal areas, source watersheds, and other relevant units.
    • Identify sources and characteristics: determine where sources of water are located and their characteristics in terms of water flow and water quality.
    • Identify landscape alterations: determine how landscapes of interest have been altered and the drivers that influence them.
    • Identify interventions: Determine which interventions, such as nature-based solutions, might provide benefits to water security, biodiversity, and other outcomes. Remember that the Situation Analysis is a living document about the current water security situation in the region. Accordingly, at this phase of the process, any proposed interventions are best placed in the Decision Support Document.
  • Overview of guidance provided below

    The goal of the science team will be to identify answers to all of the key questions identified in the Situation Analysis and the Decision Support Document.

    The guidance provided below pertains primarily to the steps needed to scope, characterize, and identify water security issues in source watersheds, which serve as critical natural infrastructure for downstream users. This guidance is provided in the following order:

    1. Scoping

    2. Characterizing watersheds

    3. Identifying water security issues in source watersheds

    4. Other key areas to consider

5 steps for SCOPING water security issues in source watersheds

  1. Identify the major points of water use

    For instance, intake points for a water utility, recreational uses in lakes or rivers, and/or withdrawal points for irrigation or manufacturing. Where does your water come from?

  2. Delineate water sources and corresponding areas of analysis

    For instance, for a water utility, their water intake point should be connected back to the aquifer or stream in the source watershed(s) from where the water originates.

  3. Identify key stakeholders for consultation

    For instance, this list may include government employees in the department of water resources or environmental quality, fish and wildlife and other agencies, utility water managers, and local water experts at universities or engineering consultancies. Refer to the Stakeholder Map you created to help identify stakeholders.

  4. Identify potential sources of information

    In addition to a list of people who may be helpful in providing information during the Feasibility Situation Analysis, it is useful to develop a list of data sources and reports that can provide insight into water issues and potential solutions. Note that the focus should be on summaries and reports, not raw data.

  5. Prepare for an integrated analysis

    Remember that the Feasibility Phase is trying to simply connect the dots, so the focus should be on questions related to identifying water security issues, interventions, and how those relate to the results of the governance and finance components.

Characterize Watersheds and Identify Water Security Issues

Once you have completed scoping, you should proceed to characterize these watersheds and identify the types and locations of sources of impacts that are driving the current or future water security issues.

Learn more

  • Characterize watersheds

    While this is not an exhaustive list, questions such as the following should be used to guide this assessment:

    • How and where has land use changed over the past 10-20 years in ways that have contributed to the issues identified above? How and where is it expected to change in the next 20 years? Is population expected to grow significantly?
    • Has water quality degraded over the last 20 years? If so, what are the pollutants of concern?
    • Is water quantity a challenge? Are water needs not being met in most years? Have freshwater ecosystems or local communities been impacted by low flows or water levels?
    • Is flooding a recurring problem in this watershed?
    • How are water resources predicted to be impacted by climate change? Are the major water quality or quantity problems expected to worsen or new problems arise?
  • Identify water security issues within source watershed(s)

    For instance, do any of the following water security issues occur within these areas?:

    • Excess sediment loading during rain events
    • Excess nutrient loading during early agricultural growing season
    • Bacteria loading from animal management
    • Limited water availability during dry seasons

    Where possible, you should quantify the water security issues by addressing questions, such as:

    • How many days a year are there water supply interruptions, and what are the thresholds for sediment, nutrients, bacteria, or low flow volumes that result in them given the current processing of water?
    • What are the actual levels of the current and future conditions, and the desired conditions in terms of water quality and quantity?
  • Evaluate patterns within the watershed

    One way to evaluate patterns within a watershed is by identifying potential point and non-point source pollutants and their origins.


    If elevated nitrogen or sediment levels threaten water supply, information on the locations and type of land use practices can be used to assess relative nutrient loading amounts for areas within the watershed.

    If land ownership is known and mapped, the different amounts of nutrient or sediment loading per land owner can be calculated using one of several spatial analytical tools that are valuable.

    If the origins of pollutants are point sources, such as manufacturing discharge or animal operation locations, these should be noted and mapped, if possible.

Other key areas of focus to include:

  • Ecosystem Services

    Ecosystem services are the benefits people obtain from ecosystems, such as the flows of materials, energy, and information from nature that combine with industrial and human capital to provide human well-being. Ecosystem services must be analyzed on a case-by-case basis with explicit recognition of local conditions, wherein existing data is researched and/or new data is generated to support the creation of water funds that focus on these services. The identification of one or more strategic ecosystem services to create a water fund will directly assist in the development of conservation priorities. The range of possible benefits that can be accrued from ecosystem services should be considered, including those provided by provisioning, cultural, and regulating services.

  • People: socioeconomic conditons

    Identifying potential socioeconomic benefits and impacts is a key aspect of the Feasibility Study. The early identification of population size and income levels within cities and source watersheds provides useful data for determining how many people stand to benefit from the implementation of a Water Fund. Likewise, an assessment of socioeconomic data may provide a general indication of the overall capacity of a given population to financially support a Water Fund (e.g. user-pay model). While obtaining access to basic data and information about local socioeconomic conditions will facilitate a high-level assessment, access to higher resolution local data will continue to be critical for the long-term success of the proposed Water Fund (e.g. conducting studies, monitoring, etc.).

  • Groundwater resources

    As a critical aspect of water security, groundwater is a vital source of water that sustains both ecosystems and human communities worldwide. Wetlands, springs, rivers, and lakes often receive inflow from groundwater. Groundwater also provides late-summer flow for many rivers and creates cool-water upwellings critical for aquatic species during the summer heat. Areas that have had extensive years of study and research hold the greatest advantage for being able to determine the early feasibility of incorporating groundwater impacts into a conservation plan. It can be difficult to account for these impacts without such studies, as the available tools to assist with analyses are limited. Access the groundwater guidance document here to learn more.

  • Conservation Value

    Determining if the proposed project will benefit nature is a critical activity under the Feasibility Analysis. Potential impacts (positive or negative) to both terrestrial biodiversity (e.g. vegetation, birds, mammals, threatened species, etc.) and aquatic biodiversity (e.g. fish species, fish habitat, macroinvertebrates, etc.) may be of significant interest to a wide range of stakeholders (e.g. NGOs, government agencies, communities, etc.). As such, where possible, this high-level, preliminary review should make use of existing studies of biodiversity and local data to generate a basic understanding of the presence (or absence) of terrestrial and aquatic biodiversity in the project area.


Examples of studies related to these science tasks are provided below (i.e. watershed assessments):


Latin America: