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Armenia

Water management, policies and legislation related to water use in agriculture

Institutions

The most important institutions involved in water resources development and management are:

  • The National Water Council (NWC): the highest advisory body in the water sector, chaired by the Prime Minister. It advises on water management issues, and makes recommendations on policies, legal documents, and the National Water Program.
  • The Ministry of Nature Protection, with:
    • the Underground Resources Protection Department;
    • the Environmental Protection Department;
    • the Water Resources Management Agency, which controls the use of water resources through water use permits;
    • the Climate Change Information Center;
    • the State Environmental Inspectorate.
  • The Ministry of Agriculture: responsible for the development of agricultural policy and strategies, including irrigation and drainage policies, with:
    • the Planning of Agricultural and Social Development of Rural Areas Department;
    • the Crop Production, Forestry and Plant Protection Department.
  • The Vorogum-Jrar Closed Joint Stock Company (CJSC): brings together State organizations with responsibilities for the provision of irrigation and drainage services. This company pumps or diverts the water from the river, operates and maintains the primary canals, and sells the water to WUAs under seasonal water supply contracts.
  • The Public Services Regulatory Commission (PSRC): responsible for the economic regulation of natural monopolies in the irrigation and municipal water sectors. The main responsibilities are water infrastructure use permits, the monitoring of the quality of service provisions, and setting of tariffs.
  • The Ministry of Territorial Administration, with:
    • the State Committee on Water Systems (SCWS), which is responsible for the management and operation of state-owned municipal and irrigation water supply, sewerage and wastewater treatment systems; it includes the “Melioration” CJSC, which is responsible for operation and maintenance of drainage systems;
  • The Armenian State Hydrometeorological and Monitoring Service (Armstatehydromet) and Environmental Impact Monitoring Center (EIMC): provide surface water monitoring data;
  • The Hydrogeological Monitoring Center: responsible for monitoring all groundwater bodies

Water management

Reforms in the water sector have been initiated since the implementation of the World Bank-supported “Integrated Water Resources Management Project” in 1999–2000. The idea of river basin management was also proposed through the introduction of annual and perspective planning mechanisms for water resources. One of the most important steps towards reform in the water sector was the adoption of a new Water Code on 4 June 2002 and, in order to ensure its enforcement, 80 regulations have been adopted by the Government since 2002, which relate, among others, to the procedures for water use permit provisions, transparency and public participation in the decision-making processes, accessibility of information, establishment of the state water cadaster, formation of water resources monitoring, management of transboundary water resources. The Code also contains the idea of integrated river basin management, for which a methodology of developing integrated water basin management plans has been developed, making it possible to use economic tools for water resources management and cost recovery. In order to promote more efficient, targeted and decentralized management of water resources, five territorial divisions (Basin Management Organizations) have been established under the umbrella of the Water Resources Management Agency: Northern, Akhuryan, Araratian, Sevan-Hrazdan and Southern. The Law on “Fundamental Provisions of the National Water Policy” was adopted in 2005; this represents a forward-looking development concept for water resources and water systems’ strategic use and protection. Since 2005 the water basin management principle is being applied in the sector of water resources management. In addition to this, a law concerning the “National Water Programme” has been developed. This law is the main document for the prospective development of water resources and water systems management and protection. As a result of the above-mentioned legal and institutional reforms, Armenia is currently one of the leaders in the region in the sector of water resource management.

By law, local mayors are responsible for providing the water service within a municipality unless the water sources and facilities serve more than one municipality, in which case one of the five State-owned water companies provides the water service. In 2006, about 80 percent of the population was served by the State water companies. The remainder of the population is served by small municipal systems and numerous community-based organizations. The “Yrevan Djur” CJSC is the largest of the five State companies and provides water and sewer services to the city of Yerevan and 28 neighbouring villages, covering around 50 percent of the total population. It operates under a recently signed lease contract with a French water company. The next largest State water company is the Armenian Water and Sewerage Company (AWSC) which operates under the terms of a management contract with another French water company. AWSC provides service to roughly 22 percent of the population. The other three State water companies, Lori, Shirak and Nor Akunk are managed with significant input from foreign consultants under the terms of a financing agreement between the State and a German lending agency. At the beginning of 2006, the average monthly water bill for most residential customers in Armenia was less than US$2. The collection rate has been improving but is still less than desirable.

Hydropower accounts for 20 percent of electricity generation. The total installed hydropower generating capacity of Armenia is about 1 100 MW, of which 1 050 MW is operational. Almost 95 percent of this capacity is installed along two important hydropower cascades: the Sevan-Hrazdan Cascade and the Vorotan Cascade. Electricity generation at the Sevan-Hrazdan Cascade is tied to irrigation releases from Lake Sevan on the basis of an annual water allocation plan (USAID, 2006).

USAID designed the Programme for Institutional and Regulatory Strengthening of Water Management in Armenia (2004-2008) to provide technical assistance, training and equipment to improve water resource management and the regulation of the increasingly decentralized irrigation and municipal water sectors. The programme will lay the foundation for effective water resource management and planned investment in the Armenian drinking water, sewerage, and irrigation sectors and assist the Government and leading water sector agencies to enhance their effectiveness through initiatives based on international best practices adapted for the Armenian context.

Finances

Currently, the State funds about 50 percent of the annually assessed Operation and Maintenance (O&M) requirements of the water services for irrigation. For 2005, the O&M requirements were estimated to be US$16 million, with a contribution from the State budget of US$8 million, which essentially covers the electricity costs for operating the pumping stations. The irrigation tariffs that WUAs or other users pay to the Vorogum-Jrar differ by region and mode of water delivery (pumped or gravity) and are capped at approximately US$20/1 000 m3 or US$150/ha. Maintenance is still inadequate to sustain the irrigation systems due to an underestimation of the annual O&M requirements and lower than expected tariff collection rates. The real O&M costs may vary from US$5/1 000 m3 or US$40/ha for gravity schemes to more than US$50/1 000 m3 or US$400/ha for some high-lift pumped schemes. The latter costs are higher than the incremental income earned by many subsistence farmers as a result of irrigation and may range from US$200/ha to US$400/ha per year (USAID, 2006).

Investments, such as the recently approved grant of US$236 million from the US Millennium Challenge Corporation may go a long way toward stabilizing the irrigation subsector. The grant will support a five-year programme of strategic investments in irrigation and rural roads, aimed at increasing agricultural production. The grant will also fund the improvement of drainage facilities, the rehabilitation of irrigation infrastructure, the strengthening of the Vorogum-Jrar and WUAs, and a water-to-market project that will provide training and access to credit for farmers who want to make the transition to more profitable, market-oriented agricultural production (USAID, 2006).

Policies and legislation

As mentioned in the “Water management” section above, the legal and institutional structure of the water sector is based on the National Water Code adopted in 2002. The Water Code defines three major functions in the water sector: management of water resources, management of water systems, and regulation of water supply and wastewater services.

     
   
   
             

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