Chapter 2. Managing water for the Water-Energy-Land-Food nexus in Korea

This chapter provides practical water policy guidance to improve water management for the WELF nexus in Korea. It reviews the water quantity and quality monitoring framework in Korea, and focuses on policies to strengthen the management of water demand and water quality.


2.1. Water quality and quantity monitoring

Managing land and water resources well starts with a good understanding of the state and trends of the environment and the pressures on it. All elements of monitoring, data retrieval, archiving and analysis must integrate and work efficiently together.

There are four areas in particular where the Korean monitoring and assessment regime appears to be in need of review.

  1. 1. The range of parameters in the water quality monitoring programme is limited.

Experience from the USA and across Europe shows that in catchments where there are discharges of sewage and industrial effluents, or widespread agriculture, then there are many other pollutants, such as metals, hydrocarbons, pesticides, organics and pharmaceuticals which need to be monitored because of their impact on the environment and risk to human health (OECD, 2017a). Only once these parameters are monitored, and their concentrations understood, can pollution loads be managed so as to reduce environmental and health risks. In particular, this means understanding where the pollution ‘hot spots’ are so that permits and enforcement can be tightened up as necessary, and for river water quality monitoring to reflect the range of pollutants which pose a risk to ecosystems. Over time, as a clearer picture emerges of the most degraded water bodies and aquifers, measures can be better targeted through planning processes. As illustrated in Table 2.1, the range of parameters in Korea’s water quality monitoring programme is limited.

Table 2.1. List of parameters monitoring in surface and groundwater bodies

Water resource

Water quality parameter

River water

pH, DO,SS, COD, BOD, cd, As, CN, Hg, Pb, Cr⁺⁶, ABS, PCB, T-P, T-N etc.


pH, colon bacillus, NO3-N, chloride ion , bacteria, cd, As, CN, Hg, organophosphorus, Pb, phenol, Cr⁺⁶, trichloroethylene, tetrachloroethylene, benzene, toluene, ethylbenzene, xylene etc.

Source: Water Resources Management Information System; WAMIS, In: OECD Background report provided by ME.

Where and how water quality is monitored is also important. Critical locations will be downstream of major discharges of household or industrial effluent, or of potentially polluting activities such as mining, both at active sites and abandoned mines. Whether these are monitored routinely, or as part of the permit compliance process, will be a matter of judgement.

The frequency at which samples are taken matters, in terms of the level of confidence in the reliability of the data. Two or four samples a year may not be representative of the water quality for the rest of the year – or even of the day on which the samples were taken. The frequency of water quality monitoring therefore needs to reflect the likelihood of variability, which will be different in each water body. Once there is confidence that there is little variation, then the frequency of sampling may be scaled back to surveillance monitoring. Where more variability exists, then sufficient samples need to be taken in order to have statistical confidence in the results. In some critical locations, continuous real-time monitoring will be appropriate. This is particularly the case for compliance monitoring of effluent discharges and drinking water intakes, and is dealt with in more detail below.

  1. 2. Efforts to routinely monitor aquatic invertebrates, macrophytes (aquatic plants) and fish need to increase.

Without an understanding of ecosystem health it is impossible to know whether water and land management and the controls on abstraction and pollution are effective and sustainable. For example, the ecology downstream of a major discharge can provide indications as to whether permit limits are being regularly breached, in a way which occasional effluent samples might not be able to. In order to understand the pollution pressures on ecosystems, water quality monitoring and ecological monitoring should be harmonised. The National Aquatic Ecological Monitoring Programme monitors ecosystems in the four main rivers. Habitat conditions in all rivers have declined between 2008 and 2014 (OECD, 2017b), and the Geum and Yeongsan rivers have also deteriorated based on their scores for fish and diatoms. The ecosystem health of tributaries and small rivers is not reported. If the introduction of ecological flows is to be successful they will need to reflect not just the needs of the current ecology but also targets for more diverse and abundant ecosystems, in all rivers.

  1. 3. River flow data and trends are limited.

River flows will be affected by abstractions and discharges and so could be higher, or lower, than they would be if there were no human influences. It is important to use measured flow data to then develop naturalised flow sequences, where the effect of the artificial influences can be accounted for and the natural baseline then used as the basis for a policy decision to determine safe volumes of abstraction and volumes to be allocated for ecological flows. Modelling naturalised flows downstream of reservoirs will also help to establish an appropriate pattern of releases for environmental purposes. In addition, the trends over time in naturalised flow sequences can help to indicate the effect on runoff from changes in land use, and potentially be an early indication of climate change.

  1. 4. More information on surface water-groundwater interactions, are needed.

The distribution of groundwater monitoring boreholes provides a picture of the overall aquifer behaviour, and the Integrated Groundwater Information Service supports maps of groundwater level data across Korea. However, in locations where there are concentrations of abstraction boreholes, it is important to understand whether these are operating sustainably, or whether groundwater levels are declining because abstraction is exceeding recharge. This information, together with an understanding of groundwater-surface water interaction is essential to developing abstraction policy and water allocation regimes. Similarly, the existing comprehensive groundwater quality monitoring regime needs not only to consider risk but also to improve knowledge of the impact of other sources of diffuse pollution from agriculture and industry, and the policy decisions to reduce it.

Therefore, points to consider for any review of internal processes in monitoring include:

  1. 1. Review the location, frequency and parameters in water quality monitoring

  2. 2. Ensure that ecological monitoring is representative of the entire river basin and the range of ecosystems

  3. 3. Use naturalised river flows as the basis for water allocation regimes

  4. 4. Ensure that groundwater–surface water interactions are understood and managed to prevent over-abstraction and contamination.

2.2. Water demand management for the WELF nexus

2.2.1. The need to move away from ‘predict and provide’

The traditional, engineered approach to securing water supplies in most countries, including Korea, has been ‘predict and provide’ – an expanding water economy. This resulted in storage infrastructure being developed to meet whatever forecasts of demand were produced, leading to an unsustainable spiral where more and more water was taken from the environment to meet the ever-increasing needs of economic and population growth, and creating a false impression that water is readily available.

Over time, most nations face the tension of how to maintain supplies to a growing population and economy, when the most economically viable building sites for reservoirs have been exploited and water scarcity becomes a growing challenge. As illustrated in Chapter 1. , this is the case for Korea.

The OECD report on water use efficiency in Korea (OECD, 2017c) has established that such a supply augmentation strategy to managing water quantity has performed extremely well over the last four decades, supporting rapid demographic and economic growth in Korea. However, this strategy has now reached a limit and Korea is exploring a shift towards a combined approach that pays more attention to managing demand for water.

Managing demand for water will be essential for future water security in Korea, but will require a different perspective on water management. For demand-side measures to be effective, water users should recognise that they are part of the solution. In England and Wales, the economic regulator Ofwat has challenged water companies to work with their customers to transform them from passive recipients of a service to active participants in water management. Users need to understand that it is their (excessive) use of water which threatens water security, and that they need to value water as a scarce and valuable resource. A number of factors mean that this is not the case in Korea:

  • Water and sanitation charges are the lowest in the OECD (OECD, 2017c). Generally low and declining cost recovery rates do little to incentivise water efficiency and threaten the financial sustainability of the sector.

  • Cultural norms reinforce water as a commodity which can be wasted: ‘using it like water’ is an expression which highlights its lack of value.

  • Water in the natural environment (environmental flows), and the ecosystems it supports, is not valued as a service for society.

  • Abstraction licences are poorly enforced, if at all, and there are no meaningful charges.

  • There is a perception that water resources scarcity is not an issue in Korea – even recent droughts appear not to have shaken the apparent complacency – and so saving water is not viewed as important.

By contrast, water quality is of concern, as a result of high-profile pollution incidents and drinking water contamination. However, the response has been for citizens to buy bottled water and use water filters, rather than clamour for tighter controls on industrial and agricultural pollution. These ambivalent perspectives on sustainable water management are at the heart of many of Korea’s challenges with the WELF nexus.

Korea needs to consider how it can move towards better management of water demand, and to raise awareness across all sectors about the risks of profligate use. The OECD report on water use efficiency in Korea (OECD, 2017c) explores this issue in some depth. It stresses the benefits - and the challenges - of designing a water abstraction charge that reflects the opportunity costs of using water. That charge should be higher where water is scarce and users compete to access the resource.

The following sections address related aspects of demand management and water efficiency, including leakage control and water efficiency programmes. They would deliver best if a well-designed abstraction charge is in place.

It is important that cultural attitudes related to the inefficient household use of water – one of the highest in the OECD – are addressed. Maintained engagement, education and awareness campaigns - not just during droughts – are required to promote behaviour change.

2.2.2. Leakage control

Droughts highlight leakage as an emotive issue. At a time when householders, farmers and industry are being asked to use less water, the volumes lost through leakage come under the political and media spotlight. Leakage rates are often seen as an indicator of the performance of a water company and can make a significant difference to the willingness of customers to cooperate with water restrictions.

Urban leakage rates across the world vary significantly. Displaying leakage rates as a percentage is criticised by professionals, since it may not be clear what it is a percentage of (total water into supply, water delivered etc.) and the percentage leakage number can appear to reduce if consumption goes up and leakage remains static. Other metrics, such as cubic metres lost per kilometre of mains length or by number of connections, can provide better comparators, as can the Infrastructure Leakage Index (ILI) (Winarni, 2009). The ILI is a water losses performance indicator which provides a rational basis for comparisons for water losses. It is not clear why leakage rates in some parts of Korea are so high (up to 35% in some areas), although the following issues are fundamental to leakage in any supply system and some or all may need attention:

  • Quality and speed of repairs

  • Extent of active leakage control measures

  • Pressure management

  • Pipeline and asset management, including the choice of materials, design, installation, maintenance, renewal/refurbishment, replacement.

For non-specialists, leakage as a percentage of the water put into supply is an accessible and meaningful statistic. At 16.3% as a national average, Korea compares moderately well with other nations, but at a regional and municipal level (e.g. Gwangju at 56.8%), leakage rates are extremely high. Excessive leakage rates cost money. The water has to be pumped and treated, and represents a lost revenue opportunity. In addition, low pressure from bursts can risk contamination from polluted groundwater and sewers entering the distribution network, jeopardising human health. Australia learned that demand management and leakage control was a cost-effective measure during its 10-year Millennium Drought. Building new dams would have cost USD1,370 per Megalitre (Ml) of water delivered (Alliance for Water Efficiency, 2017). By contrast, the same volume could be added by plugging leaks in the network at a cost of only USD365/Ml. Replacing high flow plumbing fixtures cost just USD454/Ml, less than a third of the cost of developing new supply.

Basic leak detection measures on a reactive basis, and proactive find and fix techniques, can be cost effective for tackling large bursts and unseen leaks. Improved pressure management can immediately reduce total losses since pressure is a major driver of leakage and background losses. For example, achieving the low leakage rates in Copenhagen (7%) and Amsterdam (5%) is helped by relatively low network pressures, but the low leakage rates do also require active network monitoring and leakage control. Increasingly, new technology including the use of remote sensing is proving effective in active leakage identification and control.

A leakage control strategy needs to operate in parallel with a water resources plan, so that progress in leakage reduction is made systematically to contribute towards maintaining the supply-demand balance, and is more aggressive where and when water is most scarce. Data on leakage ‘hotspots’ and burst frequency can help to identify those parts of the network where mains refurbishment or replacement is a priority. Benchmarking and target setting can help to drive leakage reduction and provide a focus on asset condition and repair.

2.2.3. The value of managing demand through water efficiency programmes

Efficient water use in homes, industry, businesses and energy and agriculture production has an important part to play within the Twin Track approach to water resources planning and management, as a long-term and scalable investment driven by strategic planning.

The restrictions and trade-offs required during droughts between agricultural and urban use expose the need for a more equitable and efficient approach to water use and allocation in Korea. Agricultural water use in Korea, which accounts for 62% of abstracted water, incurs only low or no charges (OECD, 2017b), and is not subject to the same abstraction controls as other uses, such as a requirement to measure abstracted volumes. The costs – whether from the consequences of excessive and unsustainable abstraction, or of diffuse pollution from nutrient or sediment runoff – are externalised, and any attempt to have them internalised is resisted. The lack of regulation and enforcement, weak or absent policies to link water use and land use, and no sustainable baseline for abstraction, mean that other water users and the environment bear the consequences of inefficient water use by agriculture.

Due to the high water stress in Korea, there is an urgent need for more efficient irrigation processes, such as drip irrigation (SAI Platform, 2012), and for water to be used more beneficially (‘for higher value use’). Better agronomic practices and improved crop varieties are other options to reduce impacts on the water system.

Given the volumes of freshwater used directly and indirectly by agriculture, the sector has a responsibility to use it wisely, recognising that other needs, including the environment, may not have access to the water they need. This would mean that there would be an increased output per unit input of water – a principle which would expected in any other sector – with incentives (abstraction charges) that signal the scarcity of water. It would also bring other benefits such as reducing pumping costs and fertiliser application, and reducing diffuse pollution risks. However, it is essential to understand that caution is required to avoid unintended impacts from water use efficiency, such as: a reduction in water availability for other users and the environment, expansion of irrigated land areas with water saved, and an increased dependence on water resources and the risks associated with climate change (OECD, 2016a). Inefficient irrigation systems may be benefitting groundwater recharge, ecosystems and effluent dilution, particularly in areas growing paddy rice. For example, in Japan, it was estimated that irrigated rice cultivation contributes over 23% of total groundwater recharge (Mitsubishi Research Institute, 2001; OECD, 2015a).

Mitigating the unintended consequences of water use efficiency gains implies appropriate water accounting at the basin scale that considers not just withdrawals but also water returning to the system. Moving from hydrological science to the inclusion of such return flows in water right systems is, however, a complex task. The allocation regime must take account of and manage these issues; it should not allow farmers to continue to abstract as much as they did before unless the volumes are sustainable. Firstly, accounting for return flows should be studied systemically to assess their relative importance in basins and aquifers. In a second step, return flows would need to be accounted for in water allocation systems to better reflect overall water supply and demand, and thus improve the efficiency of water allocation (OECD, 2015b). Thirdly, water efficiency gains should be accompanied by a regulation to appropriately direct the use of saved water and prevent the perverse effects described above (OECD, 2016a). This will require a dialogue with farmers to ensure that they do not simply increase the irrigated area because they think that they have more water to do so.

Improved water efficiency and water conservation is also required for the Korean industry sector. A major driver towards water efficiency in industry can be the charges levied on water abstraction and wastewater discharges to sewer. Many industries abstract directly from rivers and groundwater, rather than relying on treated mains water. The charges for doing so provide little incentive to minimise abstraction rates or use water efficiently. Discharges of effluent have few controls and compliance monitoring and enforcement is weak or non-existent. There are a number of policy options to address these shortcomings outlined below (additional regulatory mechanisms are dealt with in Chapter 3. ):

  • Set permitted abstraction and discharge charges at levels which incentivise sustainable behaviour.

  • Use permits to control abstraction volumes so that they are within sustainable limits.

  • Use permits to control a comprehensive and relevant (to the process being regulated) range of pollutants, and total pollution load (toxicity and volume).

  • When abstraction permits are applied for or reviewed, set volumes in line with international benchmark data for water-efficient processes for the relevant industry, for example as cubic metres per tonne of output or unit produced. Challenge existing permit holders to adopt best practice so that their water use is in the upper quartile internationally for their industry.

  • Monitor compliance with abstraction and discharge permit conditions and take enforcement action where breaches are observed. Charges for abstractions and discharges can be linked to operator performance so that consistently good performers have a lower regulatory burden (fewer inspection visits and less frequent provision of data) and a lower charge compared with poor performers.

  • Where enforcement action is necessary to address permit infringements, fines and other sanctions should reflect the environmental and social impacts.

  • In those river basins where water is scarce, and during time of drought, target high water-using industries for action on water efficiency.

Smart meters can provide information that will aid network optimisation and customer-facing information to drive water conservation. Low-cost IoT-based sensing devices (e.g. of flow, pressure, quality) monitoring, analysing and transmitting data throughout the water network (from a well to a household) can have a significant benefit on the entire water value chain. The Smart Water Initiative in Korea (OECD, 2017c) pursued by K-water has the potential to significantly improve the efficiency of water use in the urban environment. Pilot projects to advise consumers about drinking water quality and water consumption would, if rolled out more widely, help raise awareness about water and volumes used. However, the low level of water charges provide little or no incentive towards behaviour change.

2.3. Managing water quality for the WELF nexus

Rapid expansion of the Korean economy has resulted in serious degradation of water supplies and freshwater ecosystems from municipal, industrial and agricultural pollution. Water quality is a distinctive part of the WELF nexus in Korea. Water pollution contributes to water scarcity; impacts land and food, energy and industrial production; effects drinking water and human health; reduces biodiversity and ecosystems services; and generates conflicts between upstream and downstream users. The agriculture sector, in particular livestock farming, is a major contributor to water pollution in Korea (OECD, 2018, 2017a). Despite the introduction of an additional water use charge in 1999 for downstream water users to pay for upstream farmers to reduce agricultural intensification, and that vast investments in water pollution treatment facilities have been made, water pollution problems are still encountered (Choi et al., 2017).

This section of the report assesses Korea’s current water quality management regime and suggests a hierarchy of water quality principles for action. It highlights the importance of environmental regulation and linking water quality management with water quantity and land management at the basin scale. Options for water quality policy reform in Korea are recommended for the short- and longer-terms. International case studies are cited as examples of what Korea may aim to achieve.

2.3.1. Water quality management in Korea

The Environmental Standard of Water Quality of Aquatic Ecosystem, as a part of Korea’s Environmental Standard, lays out the Korean government’s water quality goals that are required to secure human and ecosystem health. It also provides a framework for policy instruments used to manage water quality.

Four main policy instruments are used to manage water quality in Korea:

  • The total pollution load control programme, which aims to reduce point source pollution of total phosphorus and biochemical oxygen demand.

  • Regulations for the control of wastewater discharges from industry and municipal wastewater treatment plants to protect human and ecosystem health.

  • Regulations on livestock manure, stipulated under the Act on the Management and Use of Livestock Excreta.

  • Water use charges, which are collected as River Management Funds (RMF) to support upstream water quality projects selected by River Basin Committees at the basin-level.

Despite the above policy instruments to control water pollution, improvements in water quality remain limited. It is recognised that diffuse source pollution, particularly from livestock farming, is now the main source of pollution; the proportion of total pollution attributed to diffuse pollution is projected to reach over 70% by 2020 (ME, 2014a). Each of the above policy instruments are assessed in the following sections.

The Total Pollution Load Control Programme

The Korean total pollution load control (Korean TMDL) programme currently focuses on the regulation of total phosphorus (TP) and biochemical oxygen demand (BOD) from point sources of pollution only. Targets are set in each of the four major river basins according to development plans provided by local authorities. Since the introduction of the Korean TMDL in 2004, reduction targets in point source pollution have been achieved. With the aim of meeting water quality targets, government subsidies (through the RMF) have supported investments in wastewater treatment plants and land purchases to retire sensitive areas from intensive land use (such as riparian buffer strips). A summary of the Korean TMDL programme is provided in Box 2.1.

Box 2.1. The Total Pollution Load Control Management System, Korea

In 2004, the Korean Total Water Pollution Load Control programme (Korean TMDL, the equivalent of a total maximum daily load programme) was introduced to improve water quality management policy in Korea. The TMDL allocates pollution load reductions necessary to reduce the sources of pollution and achieve desired water quality. It is aimed at water quality improvement and economic growth simultaneously.

Water quality targets are set periodically for each of the four main river basins - the Nakdong, Geum, Youngsan-Seomjin and Han. Local water quality targets and implementation plans are then established to achieve the overarching target for the watershed. Biochemical oxygen demand (BOD) was selected as the first target parameter in 2004, followed by total phosphorus (TP) in 2011. Targets near the boundaries between provinces and cities are required to be notified so that water quality targets can be attained in co-operation.

Permissible total maximum daily pollutant loads are calculated using scientific water quality modelling at the watershed, local and individual property levels. Economic development, population growth, pollutant reduction and local development planning are considered together. The Korean TMDL management system clarifies the responsibility of each relevant entity by identifying each pollution load by local government, sub-local government and individual polluter, with a view to meeting and staying on the water quality target.

Once the water quality targets are set, governors and mayors develop detailed local development plans and annual plans for pollution reduction, with a view to meeting the load allocation of each watershed. In co-operation with stakeholders, governors and mayors then decide how to allocate pollution load permits to individuals in order to attain and maintain the overarching target for the watershed. It is up to each local government and the stakeholder how to allocate these pollution loads. Technical Guidelines for Korean TMDL Management provided by the National Institute of Environmental Research require pollution load permits be set through water quality modelling, considering equity, efficiency and effectiveness of reducing pollution loads. Voluntary allocation through stakeholder co-operation and engagement is also encouraged in the Technical Guidelines (NIER, 2014).

Implementation and performance of the Korean TMDL system is evaluated every year by central government. When improvements are required, central government may ask a governor or mayor to establish and take necessary measures: for example, putting further restrictions on urban and industrial development projects, suspension or cutbacks of financial support, or restriction on installation or modification of facilities where discharging wastewater. River Management Funds (RMFs) also offer support for implementing the TMDL system. Since 2004, RMFs have supported investments in wastewater treatment plants and land purchases to retire sensitive areas from intensive land use to riparian buffer strips. In addition, new pollution reduction technologies and approaches through R&D projects is a factor attributable to the success of the TMDL system.

In 2013, water quality targets were achieved for 81% of rivers. Figure 2.1 is a demonstration of the success of the Korean TMDL system in the Nakdong, Geum and Yeongsan Rivers. However, water quality targets were achieved in only 12% of lakes; Korea’s lakes and reservoirs are particularly vulnerable due to the high residence time in comparison to rivers (as are most lakes around the world). Strict management is considered necessary to achieve continuous water quality improvements in in later stages of TMDL implementation (Kim et al., 2016).

Figure 2.1. Water quality improvements under the Total Pollution Load Control Management System Korea
BOD, 2004-2010

Sources: OECD (2017a), Diffuse Pollution, Degraded Waters; National Institute of Environmental Research (NIER) (2014), Technical Guidelines for Korean TMDL Management, Korea.

However, the success of the Korean TMDL is limited for the following reasons:

  • The range of pollutants is currently narrow – BOD and TP only.

  • It does not consider all inputs of a given pollutant, in particular, diffuse sources of pollution (including from agriculture) are not captured. In recent years, the proportion of diffuse sources in relation to point sources has increased.

  • It only applies to the four main river basins, and excludes tributaries and small coastal rivers.

  • Compliance monitoring and enforcement is insufficient.

  • There is little, if any, relationship with streamflow and ecosystem toxicology.

There are opportunities to expand the Korean TMDL, to include a much broader range of pollutants, polluters and tributary streams so that it reaches its full potential. In addition, it is not clear how, or whether, the limited ecological monitoring programme is used to specify water quality objectives for the protection and improvement of ecosystems. For this to happen, there needs to be an integrated and structured relationship between the parameters specified in pollution discharge permits, the compliance monitoring of those parameters in point source discharges, the breadth of the water quality monitoring regime, and the system used to determine and classify ecosystem health.

Regulations for municipal and industrial wastewater discharges

In 2014, 93% of the population was served by wastewater treatment services, compared with 71% in 2000. In addition, 83% of the population benefits from advanced (tertiary) treatment - a remarkable increase from almost nothing (1%) in 2000 (OECD, 2017b).

Effluent quality standards (discharge limits) from municipal wastewater treatment plants have been set for 49 parameters, including organic substances, suspended solids and phenols. Many standards (e.g. for total nitrogen and total phosphorus discharges) have been made more stringent, representing important progress. Receiving water body characteristics such as the existing water quality grade, are considered in the application of the effluent standards.

Effluent quality standards for industrial wastewater are applied to seven pollutants, including BOD, COD, total nitrogen, total phosphorus and suspended solids. Standards for BOD, COD and suspended solids are more strict for large discharge facilities. Permission or notification for the installation of wastewater discharge facilities is required. Discharge fees are applied, and measures such as instruction, inspection and administrative dispositions are taken to ensure implementation of the regulations (ME, 2015).

To manage the ecosystem impact of hazardous water pollutants, an effluent standard measured in “toxic units” (a composite measure of concentration reflecting the toxicity of individual substances) has been applied to industrial facilities and wastewater treatment plants since 2011. The 2007 National Sewage Master Plan established several targets for 2015, including improvement of influent treatment quality through maintenance, repair of 93% of the sewerage infrastructure, increase of the sewerage connection rate to 92% of the population and 75% of the rural population, and increased reuse rate for sludge (to 70%) and treated wastewater (to 18%).

However, the level of compliance and enforcement of effluent standards is limited and penalties remain rare; in 2013, only 35% of wastewater discharge infringements required corrective measures (ME, 2014b). The majority of polluters often get away with a simple warning (OECD, 2017b). Large plants subject to "Focus" can be inspected up to 4 times per year. The efficiency of inspection depends on continuous monitoring of key parameters and at least daily analysis monitoring of all permitted substances. It also depends on how process failures are reported and dealt with.

Regulations on livestock manure

Currently there are no environmental regulations specifically imposed on agricultural production, with the exception of regulations on livestock manure, stipulated under the Act on the Management and Use of Livestock Excreta. The regulations require each major river basin to establish a 10-year plan of livestock manure management and report it to ME.

Livestock manure is the main agricultural source of water and soil pollution in Korea. As mentioned in Chapter 1. , Korea currently shows the highest nitrogen balance among all OECD countries. Most OECD countries have succeeded in reducing their nitrogen balances over time; Korea has not. The average nitrogen balance in Korea increased from 213.1 kg/ha in 1990-92 to 249 kg/ha by 2012-14 (OECD, 2018). In the Netherlands, the nitrogen balance fell to 148 kg/ha in 2012-14 from the 1990-92 level of 309 kg/ha despite a growth in livestock production. The reason for the nitrogen reduction in the Netherlands was the introduction of a manure quota system and manure land application limits (Annex 2.A).

Since 1991, the ME has provided subsidies for the installation and operation of public manure treatment facilities to reduce small-scale farms’ burden of manure treatment. Since 2006, MAFRA has supported R&D in manure treatment technology financially and technically to convert manure into reusable compost and granular and liquefied fertilisers, while reducing chemical fertilisers and dealing with the manure treatment for medium-scaled farms (OECD, 2018). However, because the livestock industry is expanding and the total area of cropland declining, there will be an excess supply of manure composts and liquid fertilisers.

Improving the policy framework to manage livestock manure is a priority considering the future growth potential of the livestock sector. To tackle the growing livestock manure management problem, a more comprehensive policy approach beyond the current regulation is necessary.

Water use charges to improve upstream water quality

Water use charges are based on the volume of water received and used by downstream municipal and industrial users. The revenue raised is collected as River Management Funds (RMFs) to support upstream water quality projects selected by River Basin Committees. A summary of how the charges work and the type of projects the RMF funds are presented in Box 2.2.

Box 2.2. River Management Funds for water quality improvement of Korea’s major river basins

To improve the water quality of the four major river basins, the ME set up water use charges to fund projects that would reduce water pollution in upstream areas. Based on the User-Pays Principle, the water use charges collect revenue from downstream users (cities and industries) to offset the losses in opportunity costs to upstream users associated with regulations against various economic activities.

Water use charges apply to downstream households, commercial entities and industry in proportion to the volume of water received and used. Water use charge rates are determined every two years based on forecasted financial resources required to achieve the target level of water quality pursuant to the law. As of 2016, the water use charge rates were KRW 170/ton for the Han, Nakdong and Yeongsan-Seomjin Rivers, and KRW 160/ton for the Geum River.

The revenue from the water use charges enters River Management Funds (RMFs). Water use charges and the RMF were first introduced in 1999 for the Han River, followed by the other major river basins in 2002. In 2015, the RMFs raised a total of KRW 10.14 trillion.

The RMF spend is overseen by the River Basin Committee in each basin, which aims to coordinate the interests of diverse stakeholders on matters relating to water quality improvements. The RMFs supports two main activity areas: i) catchment restoration and protection activities, and ii) wastewater infrastructure. Types of projects include:

  • Sewage treatment infrastructure, matching the subsidy funds from national government, and subsidising operational costs (48% of total RMF spend)

  • Resident support: income support, low interest rate loans, compensation (18% of total RMF spend)

  • Voluntary land purchase and riparian zone projects (transformation and management of acquired land) (18% of total RMF spend). As of 2016, farmers have offered 156 million m2 of land for purchase, but only 60 million m2 has been purchased because of funding constraints. The total area of ‘designated riparian zones’ reached 1197 km2 as of 2015.

  • Total pollutant load control, through subsidies to local government to work on pollution management, monitoring and research (5% of total RMF spend).

  • Other water quality improvement projects, including removing litter, monitoring programmes by NGOs, subsidising water treatment from polluted water resources, dredging, public education and ecosystem restoration (8% of total RMF spend).

Source: ME and KEI (2016), River Management Funds for the Four Major River Systems, No. 44, Korea Environmental Policy Bulletin, Vol. XIV, Issue 4, 2016.

There is significant potential to better leverage available funds to improve water quality. In 2015, the RMFs expended KRW 10.05 trillion on water quality improvement projects, the majority of which was spent on wastewater treatment infrastructure (48%), resident support projects (19%) and riparian zone projects (18%) (ME and KEI, 2016). However, little improvement in water quality is evident in the Han, Geum and Yeongsan-Seomjin River basins (Figure 1.6). The following are limitations of the water use charge and RMF:

  • Water use charges relate to the volume of water used and not to the amount of pollution generated. Therefore, the water use charge does not incentivise water users to reduce their pollution.

  • Water use charges remain low. Because of this, water quality improvement works may be constrained by available funds. For example, requests to sell land far outweigh available funds; as of 2016, upstream farmers have requested the sale of 156 million m2 of agricultural land, however only 60 million m2 of land has been purchased.

  • Water use charges are similar in each basin despite each basin have different water quality challenges, in particular, the Nakdong River basin.

  • It is unclear how policy outcomes are specified, and investment is prioritised and assessed against other (potentially more cost-effective) policy mechanisms. It will be crucial to prioritise investment decisions for policy success in the context of limited funding.

  • The budget is set on a two-year basis, which potentially affects the possibility of multi-year commitments, and is based on demand from local governments in previous years (and not future needs).

The following section outlines policy principles to guide decision-making on water quality management that may prove helpful to Korea in reforming their policies and improving water quality and ecosystem functioning.

2.3.2. Policy principles to guide decision-making on water quality management

A set of well-established principles can guide the design and implementation of policy responses to water pollution – namely the Principles of Pollution Prevention, Treatment at Source, Polluter Pays and Beneficiary Pays (Box 2.3). Where there is a lack of scientific knowledge, it is good practice for the Precautionary Principle to be adopted in order to minimise risk. In addition, equity should be considered with regards to fair allocation of pollution rights, costs and benefits of abatement, and the needs of future generations. These set of principles should be considered when designing water pollution control policy instruments in Korea.

Box 2.3. Hierarchy of principles for action on water quality

The following set of OECD principles can usefully guide the development of policy for the management of water quality. They are captured by the 2016 OECD Council Recommendation on Water.

The Principle of Pollution Prevention reflects that prevention of pollution is often more cost effective than treatment/restoration options. This means preventing pollutants from reaching water bodies by means such as recovery and re-use of wastewater, product substitution, modification of industrial processes, retirement of land and best land management practices.

The Principle of Treatment at Source considers that pollution control measures should be applied as close to the source as possible. In effect, the later the stage of control, the less effective it is likely to be due to wider dispersion of the contaminants. Particularly strict measures of control should be enforced for certain categories of hazardous pollutants with a view to preventing their dispersion into the environment. This applies especially to toxic substances which are persistent in the environment and/or subject to bioaccumulation in living organisms and concentration through the food chain (e.g. heavy metals, DDT). Management measures should aim to prevent uncontrolled pollution transfers to other water resources, or to soil or atmospheric systems.

The Polluter Pays Principle creates conditions to make pollution a costly activity and to either influence behaviour to reduce pollution, or generate revenues to alleviate pollution and compensate for social costs. Examples include pollution charges, taxes on inputs (such as fertilisers and pesticides) and sewer user charges. The polluter pays principle should not be accompanied by conflicting subsidies, tax advantages or other measures that encourage polluters to pollute, or assist polluters in bearing the costs of pollution, thereby creating distortions in the market. While there is a case for a public subsidy to address the accumulated damage caused by historical pollution (particularly when the polluters are no longer around to pay), the polluter pays principle should be the first line of defence in securing water quality and incentivising behaviour change.

The Beneficiary Pays Principle allows sharing of the financial burden of water quality management. It takes account of the high opportunity cost related to using public funds for the provision of private goods that users can afford. A requisite is that private benefits attached to water resources management are inventoried and valued, beneficiaries are identified, and mechanisms are set to harness them. For example, green infrastructure, such as wetlands and forested catchments, provide water filtration ecosystem services. Benefits and beneficiaries include: improved quality drinking water for city residents; reduced water treatment costs for utilities and health systems, and downstream industrial and agricultural users; improved business for fisheries and tourism operators; and benefits for recreational users, waterfront property owners, the environment, and society at large.

Sources: OECD (2017a), Diffuse Pollution, Degraded Waters: Emerging Policy Solutions, OECD Studies on Water, OECD Publishing, Paris.; OECD (2016b), OECD Council Recommendation on Water, [C(2016)174/FINAL], December 2016.

Increasingly, OECD member countries are adopting water quality limits that reflect the environmental risk to the receiving watercourse. The initial policy response is usually to implement controls based upon quantitative limits on pollutants, particularly for point sources of pollution. The polluter pays principle is broadly accepted internationally and convenient to apply (e.g. through pollution charges on emissions or taxes on pesticides or fertilisers), so that those responsible for polluting bear the costs of either the damage done to society or of cleaning it up to the required acceptable standard.

However, particular challenges result in diffuse pollution often being under-regulated: difficulties with identifying and targeting polluters, determining reliable estimates of pollution costs, poor enforcement of existing regulations, and strong political opposition. Korea is no exception to these challenges. Table 2.2 lists possible ways to overcome these barriers.

Table 2.2. Barriers and solutions to the control of diffuse source water pollution



Difficulties with identifying and targeting polluters

Computer modelling as a cost-effective alternative to directly observing individual diffuse pollution emissions

Taxes on inputs (e.g. fertilisers, pesticides, cleaning products) or land use (e.g. paved urban surfaces, livestock numbers, intensive land use)

Collective accountability at catchment level

Difficulties with determining reliable estimates of pollution costs

Economic modelling and scientific monitoring to inform costs and justify action

Market mechanisms to reveal pollution costs and differentiated abilities to cope with them

Poor enforcement of existing regulations

Computer modelling as a cost-effective alternative to directly observing individual diffuse pollution emissions

Taxes on inputs (e.g. fertilisers, pesticides, cleaning products) or land use (e.g. paved urban surfaces, livestock numbers, intensive land use)

Collective accountability at catchment level

Increased financial and technical support for local authorities to enforce regulations

Strong political opposition

Economic modelling and scientific monitoring to inform costs and justify action

Stakeholder engagement

Collective accountability at catchment level

Connecting with higher-level policy priorities

Source: OECD (2017a), Diffuse Pollution, Degraded Waters: Emerging Policy Solutions. OECD Studies on Water, OECD Publishing, Paris.

Water pollution control mechanisms need to be sufficiently sophisticated to recognise the spatial and temporal complexity of pollution from a range of sources. And because each river catchment is unique, the management controls must be adapted to the natural properties of the river, as well as the nature of the pollution affecting it. Innovative policy responses to control diffuse source pollution are emerging in OECD countries from which Korea may learn. They are based on three options:

  1. 1. Managing land use practices (e.g. stormwater, nutrient and erosion control practices) and inputs (e.g. fertilisers, irrigation) as proxies that cause distribution of diffuse emissions;

  2. 2. Rewarding or penalising polluters collectively for their jointly determined impacts on ambient pollution levels at particular receptors; or

  3. 3. Managing estimated diffuse emissions via computer modelling.

For instance, policy makers and regulators across the EU, USA, Australia and New Zealand manage pollution by modelling the catchment water quality and then using permits with numeric limits which can be monitored and enforced. Even difficulties with monitoring and managing diffuse sources of pollution can be overcome with effective modelling, as demonstrated in the case of New Zealand (Box 2.4).

Box 2.4. Nutrient modelling in New Zealand

OVERSEER®, a national model for farm-scale nutrient budgeting and loss estimation, calculates nutrient flows in a productive farming system and identifies risks of environmental impacts through nutrient loss, including run-off and leaching. The model was originally developed as a tool for farming to create nutrient budgets and has been adapted to overcome barriers that arise from an inability to clearly identify diffuse source polluters. It is recognised as the best tool currently available for estimating nitrate leaching losses from the root zone across the diversity and complexity of farming systems in New Zealand. A summary of the model inputs and outputs are presented Table 2.3.

Table 2.3. OVERSEER® model inputs and outputs

Inputs: Farm level

Inputs: Management block level (i.e. paddock/field scale)


Farm location

Types of blocks and block areas (e.g. pastoral, fodder crop, house, scrub, wetland, riparian)

Types of enterprises (e.g. pastoral, cropping)


Stock numbers, breed


Placement (grazing off, wintering pads)

Types of structures

Effluent management of structure

Stock management on structure

Type of effluent management system

Supplements imported and where they are fed




Soil type


Soil fertility tests

Pasture type

Supplements made on the block

Fertiliser applied

Irrigation applied

Effluent applied

Animals (type, timing) grazing the block

Crop rotation; crops grown – yield, fertiliser applied, harvesting method

Nutrient budget.

N sources: atmospheric, fertiliser, animal transfer, supplements fed on block, irrigation and nutrients out

N losses: produce (e.g. milk), animal transfer, supplements (e.g. hay), leaching/runoff, atmospheric (e.g. N2O).

Farm-level and block-level reports.

e.g. Total N lost to water for blocks and farm; Average N concentration in drainage based on N leached; N surplus per block.

Advisory reports.

e.g. N conversion efficiency (%); total GHG emissions; maintenance fertiliser requirements.

OVERSEER® can, and has, supported water quality policy development, most notably the Lake Taupō nitrogen market and as part of Horizons One Plan to limit nitrogen losses based on the natural capital of the soil in the Manawatū-Wānganui region. New Zealand farmers will increasingly use the model to develop nutrient management plans and budgets, as required by regional councils.

Source: OECD (2017a), Diffuse Pollution, Degraded Waters: Emerging Policy Solutions. OECD Studies on Water, OECD Publishing, Paris.

Korea could benefit from a mix of policy instruments (regulatory, economic, and voluntary) to manage multiple sources of water pollution, hold polluters accountable and improve the cost effectiveness of pollution control Table 2.4). The complexity associated with water pollution from multiple sources and multiple sectors also requires a response which is part of an overarching integrated national water policy framework, rather than sector-specific (OECD, 2017a; 2012). This is discussed in the following section.

Table 2.4. Examples of policy instruments to address water pollution and protect freshwater ecosystems

Water-related risk



Voluntary or information-based

Water pollution

Water quality standards

Pollution discharge permits (with quantity, quality and timing conditions)

Mandatory best environmental practices

Non-compliance penalties – non-renewal of resource permits or greater restriction on current permits

Non-compliance fines

Bans or restrictions on the use of harmful substances and land-use practices

Registration for low risk activities

Pollution taxes (on inputs, e.g. fertilisers or stock numbers)

Pollution charges and sewer surcharges (on pollution outputs)

Water quality trading

Payment for ecosystem services

Subsidies to incentivise uptake of new technologies

Information and awareness campaigns

Farm advisory services for improved farming techniques (to minimise negative impacts on water quality)

Contracts/bonds (e.g. land retirement contracts)

Best environmental practices (or good management practices)

Environmental labelling – products that meet certain environmental standards can be marketed and sold at a premium and/or subsidised.

Risk to the resilience of freshwater ecosystems

Minimum environmental flows (also for pollution dilution)

Specification obligations relating to return flows and restrictions on discharges in drought conditions

“Buy-backs” of water pollution allowances to ensure adequate water quality for ecosystem functioning

Information and awareness campaigns

Voluntary surrender of pollution discharge allowances

Source: OECD (2017a), Diffuse Pollution, Degraded Waters: Emerging Policy Solutions, OECD Studies on Water, OECD Publishing, Paris.

2.3.3. The importance of policy coherence for water quality management

Pressures from a range of policies and developments in Korea have affected water quality, including agricultural intensification (in particular the expansion of livestock farming), alterations to the natural morphology of water bodies (including the construction of dams), urban development (including increased stormwater and sewer discharges), historical pollution (including from industry and mining operations) and climate change. Policy coherence is required to ensure initiatives taken by different policy sectors do not have negative impacts on water quality and freshwater ecosystems, or increase the cost of water quality management.

Multiple policy sectors and ministries affect water quality and its management, for example, urban development, agriculture, climate, natural resources, forestry, energy, conservation and human health. This emphasises the need for improved communications and coordination within and between ministries in Korea for sustainable management of water quality and the WELF nexus more broadly. The recent water governance reform through the adoption of the revised Government Organisation Act, June 2018, merges responsibilities of water quantity and quality management under one ministry (ME). This merge is a step in the right direction for improved policy alignment and coherency. However, improved coordination does not come automatically; ME will need to develop and implement a water quality and quantity “coordination” strategy for effective merging of responsibilities at national and sub-national levels.

Korea could improve policy coherence for improved water quality by undertaking the following:

  • Removal of subsidies that encourage land use change or intensification that can result in diffuse water pollution. For example, producer support, fertiliser or energy subsidies, subsidised irrigation or non-existent pollution charges. Korea remains one of the largest providers of producer support for agriculture in the OECD and consists mostly of market price support, a category of support with potentially environmentally harmful effects (OECD, 2018). Furthermore, the agriculture sector does not pay energy taxes and only partially pays water charges. Such subsidies should be phased out and replaced by targeted payments in exchange to environment best practice and/or targeted subsidies for the poor (unlinked to production) to address social concerns.

  • Looking for win-win solutions, such as nitrogen oxide reductions to simultaneously improve air and water quality, and reduce greenhouse gas emissions. Such solutions can incentivise uptake of policies by users and reduce transaction costs for regulators. For example, in New Zealand, the Lake Taupo nitrogen market was complemented by the New Zealand Emissions Trading Scheme which incentivised afforestation, and subsequently advanced the achievement of nitrogen reductions to improve water quality and also improved carbon sequestration.

  • Integrating water pollution control (both point and diffuse source) with land use management, and water quantity management. Water quality and water quantity should be managed in unison as the two are interrelated and interdependent. For example, poor water quality reduces the quantity of useable water and therefore exacerbates the problem of water scarcity; water scarcity reduces the capacity for dilution of point source pollution; and high rainfall events cause diffuse pollution from land runoff (agricultural and urban) and combined sewer overflows into rivers. The unification of water management under ME provides an opportunity to move into this direction. Linking water quality policy with land use planning under MoLIT will be important for reducing flood risks and stormwater pollution in urban areas, and diffuse pollution from agriculture.

The potential synergies and complementarities among the WELF sectors should be used to guide formulation of effective options to maximise gain, optimise co-benefits, and avoid negative impacts. For example, changes in agricultural practice may deliver reductions in nutrient pollution at lower cost (and with less energy consumed) than conventional wastewater treatment solutions at fixed plants. Investment in green infrastructure may provide multiple environmental benefits but may also be less certain in the magnitude and timing of the improvement. Other examples of the potential trade-offs and co-benefits from water quality interventions are provided in Table 2.5. Similarly, there are benefits of factoring water quality into policies that affect water availability, and water and land use.

Table 2.5. Examples of water quality trade-offs and co-benefits between sectoral policies

Water quality intervention

Potential trade-offs and co-benefits

Wastewater reuse to avoid pollution of rivers

Trade-offs: reduced environmental flow of rivers, additional energy requirements to process and/or transport manure (including from sewage) from surplus regions to regions with a deficit.

Co-benefits: utilisation of finite resources, such as phosphate, increased water security, reduced wastewater treatment costs

Higher drinking water quality standards to improve human health

Trade-offs: increased energy consumption associated with increased water treatment, and increased carbon footprint

Co-benefits: reduced health costs

Conversion to decentralised water and wastewater systems

Co-benefits: reduced energy consumption from pumping water and wastewater over large distances, reduced carbon footprint

Restoration of wetlands

Co-benefits: reduced wastewater treatment and energy consumption, increased biodiversity, carbon capture and storage, reduced flood risks

Sustainable urban drainage systems

Co-benefits: reduced stormwater treatment and energy consumption, increased biodiversity, carbon capture and storage, reduced urban flood risks

Soil conservation to prevent erosion and sedimentation

Co-benefits: increased land use efficiency, biodiversity, food production, and water and fertiliser efficiency, reduced flood risks

Source: OECD (2017a), Diffuse Pollution, Degraded Waters: Emerging Policy Solutions, OECD Studies on Water, OECD Publishing, Paris.

Strengthening valuations of water pollution in environmental impact assessments (EIAs) can assist with the identification of trade-offs and co-benefits. The decision to commit to a new policy can be guided by a benefit-cost analysis that measures whether the potential benefits of water quality protection, adjusted to account for risks, outweigh the potential costs. International experience and lessons from previous policy successes and failures should be applied. Evaluating the impact and effectiveness of new policy after implementation (ex post) is equally important.

The links between land use, the underlying soil quality and water quality are particularly critical parts of the WELF nexus. Linking water quality policy to soil characteristics and its ability to retain water and filter pollution will encourage over time a better match between inherent capability and use. In some regions of New Zealand, nitrogen leaching limits have been allocated to individual farmers based on farm soil quality (or the underlying natural capital of the soil) to reduce diffuse pollution and achieve river catchment water quality targets (see OECD, 2017a). The concept of adding ecological boundaries (e.g. a cap on nutrient losses to limit the impact on receiving water bodies), within which land use must operate, moves the analysis from managing land to managing a landscape connected to water. Establishing ecological boundaries, within which resources should be managed, could allow the full economic potential of natural resources to be reached. In Korea, this could be envisioned by ME, MoLIT, MAFRA, RBCs and stakeholder engagement platforms working together to establish nutrient pollution caps to maintain freshwater ecological and human health in each river basin (for various key pollutants identified). These caps could then be linked with the natural characteristics of the land and soil, land use planning and land use management at the farm scale to ensure water quality targets are met.

2.3.4. Water quality management at the basin scale

A collective management approach with stakeholder engagement in setting water quality regulations at the local level (with an overarching national water quality baseline) can create buy-in, increase trust in government processes, and ultimately find effective solutions to achieve desired water quality outcomes. Stakeholder engagement through inclusive basin water governance is increasingly recognised as critical to secure support for reforms, raise awareness about water risks and costs, increase users’ willingness to pay, and to handle conflicts (see 0; OECD, 2015c).

The collaborative governance model of the Canterbury Water Management Strategy (CWMS), New Zealand (see OECD, 2017a) may provide inspiration for Korea. In this case, the river basin committee, together with the local community and technical support (with expertise in economics, cultural values, social science, modelling, water quality and ecology), developed a water quality implementation programme comprising of: i) desired community water quality outcomes; ii) recommendations for water quality limits based on maintaining the trophic state of a significant regional lake; iii) catchment nutrient loads for all activities; iv) the method of allocating the nutrient loads; v) methods to incentivise biodiversity protection (e.g. an easier resource permit pathway for development that is accompanied by biodiversity protection); vi) non-statutory actions such as an education campaign for visitors; vii) a rehabilitation programme for degraded water bodies; and viii) an integrated monitoring framework for the committee to track progress and to share data. The Collaborative Governance Model not only resolved how to set water quality (and quantity) limits and other actions to deliver on the CWMS targets, but also facilitated delivering on the National Policy Statement for Freshwater Management. One of the most tangible outcomes was community ownership of solutions. By bringing people together to solve problems, the sum is greater than the total of the parts. The success of the collaborative approach is now spilling over in to other sectors in New Zealand, such as public transport governance.

Based on the experience of the collaborative governance model of the CWMS, requisites to make a collaborative governance process work include:

  • Objective and clarity of the process. The CWMS set out the principles, targets, and methodology “up-front” and removed any doubt over scope, process, and what was trying to be achieved.

  • Commitment and clarity from governors on the lines of decision making. The Canterbury Regional Council delegated significant power to the Zone Committees by agreeing to endorse all of the committees’ recommendations when consensus was reached with stakeholder and community engagement.

  • Absolute transparency with information and process, including having difficult conversations in sessions that are open to the public and making all technical information freely available. Traceability is important; the wider community needs to be able to know when, where, why and how, certain decisions were made. It is critical to get right, and be clear about, the scale of operation - hydrological, social, and administrative.

  • Resourcing needs to match the level of ambition for stakeholder engagement and responsibility. The most substantial expenditure is the resourcing of support staff. Facilitators need to be able to deal with ambiguity, to think and work across disciplines, and be committed to developing resolutions without transposing their own ideas (i.e. “knowledge brokers”). Other technical support staff who provide science, hydrology, planning, biodiversity, cultural and infrastructure advice need to be able to communicate at various levels, and the facilitators need to be prepared to “hold a space” for stakeholders who may not be well resourced or articulate.

2.3.5. Alternatives to reform of water quality policies in Korea

This final section on water quality management outlines policy recommendations for Korea based on the assessment of Korea’s current water quality management regime and the rationale of policy coherence, policy principles and basin governance for improved water quality. The recommendations are divided into two stages:

  • Stage 1: short-term recommendations that may enhance existing water quality polices in Korea (Table 2.6).

  • Stage 2: more ambitious, longer-term recommendations that require a departure from the existing water quality regime but may offer greater improvement at least cost to society (Table 2.7).

Table 2.6. Stage 1 - Short-term recommendations for the improvement of existing water quality policy instruments, Korea

Existing policy instrument



  • Invest in monitoring and water quality assessment. Collect data on key issues at basin and sub-basin levels for both surface and groundwater bodies. Identify pollution hotspots at risk of ecosystem degradation and drinking water contamination.

  • Adjust water pollution charges to reflect environmental and social costs and to encourage reduced pollution. E.g. raise sewerage charges and the water effluent tax to a level that covers operation, maintenance and replacement of wastewater treatment infrastructure. Bands (upper and lower limits) of charges could be developed at the national level as guidance for basin-specific charges to be developed based on local conditions and financing needs. Where necessary, cross-subsidise between urban and rural areas to reduce inequities in access to sanitation services.

  • Review existing water, agricultural, energy and land policy instruments to improve their coherence with policy objectives to reduce the conflicting incentives generated by different programmes.

Regulations for the control of wastewater discharges

  • Ensure point source pollution is effectively regulated and enforced.

  • Strengthen the enforcement of water pollution permits, taxes and charges, including the issuance of non-compliance fines and penalties. The very low collection rates on water pollution taxes and charges, suggest imperfect enforcement, which further weakens incentives for pollution reduction and efficient use.

Water use charges, River Management Funds, and the River Basin Committees

  • Differentiate water use charges by basin according to the investment needs required to meet water quality objectives. Extend the budget beyond a two-year horizon to accommodate multi-year commitments and projects.

  • Where the objective is an overall reduction in load of a pollutant, consider reverse auctions for government land purchases to reduce costs.

The total pollution load control programme

  • Expand the Korean TMDL to include the whole basin (including small/medium tributary rivers) and other water quality parameters (e.g. nitrogen, heavy metals and pesticides) linked to local ecological limits and social values on water quality.

Regulations on livestock manure

  • Increase education campaigns and advisory services in the farming community as a precursor to introducing regulations or general binding rules to set minimum standards of good practice.

  • Extend the regulations to require good farming practices nationwide.

  • Use targeted, risk-based measures to reduce pollution, such as livestock units’ manure management and farming restrictions on rapid-draining or impermeable soils close to watercourses. Lessons from the EU Nitrate pollution prevention regulations are relevant (see OECD, 2017a).

  • In high risk areas where restrictions in land use and farming practices go beyond the basic standard, then payment may be justified. For example, land purchase in locally-identified ecologically sensitive areas under the RMF.

Table 2.7. Stage 2 - Longer-term recommendations for the reform of water quality management in Korea

Reform area


Examples of OECD good practices


  • Establish integrated and collaborative river basin planning – for land and water quantity and quality - to establish objectives and priorities of each of the existing water quality policy instruments in each basin and to assess their cost-effectiveness and sustainability. Linking river flows (volume, residence times/velocity and pollution dilution capacity) and water quality, together with improving connectivity within the river, and the water/land interface (wetlands, marshland, agricultural soil structure etc.) will improve all aspects of the ecosystem and help it function better to provide beneficial services.

  • Design charges for surface and groundwater abstractions and pollution discharges for all users to fund, on a cost-recovery basis, the cost of monitoring, managing and improving water resources, at basin and aquifer scales (including tributaries).

  • Issue pollution discharge permits and evaluate environmental impact assessments whilst considering not only the pollution load, but also the river flow regime, the breadth of polluting substances that might adversely affect ecosystem health, and the sensitivity of the ecosystem at different places down the river. Environmental Quality Standards could be used instead or in combination to set permit conditions, to set an upper limit of acceptability to protect human health and freshwater ecosystems.

  • Phase out any harmful subsidies or reconcile conflicting objectives identified from the review of water, agricultural, energy and land policy instruments and programmes (Stage 1 recommendation). For example, rebalance the portfolio of agricultural support to public investment towards long-term productivity growth and sustainability, such as more targeted support encouraging, or conditional on, provision of good farm management practices that reduce water pollution and improve flood buffering and biodiversity protection.

  • A collaborative governance model: The Canterbury Water Management Strategy, New Zealand (OECD, 2017a)

  • OECD requisites for the design of water pollution charges (OECD, 2017a)

  • OECD requisites for diffuse pollution allocation and water quality markets (OECD, 2017a)

  • Taxes to encourage and finance reductions in water pollution and water consumption, France (OECD, 2017a)

Water use charges, River Management Funds, and River Basin Committees

  • Phase out the water use charge, which doesn't reflect the amount of pollution nor the polluter-pays principle, and exempts agriculture.

  • Replace the water use charge with economic instruments to incentivise reductions in water pollution at lowest cost to society. While all polluters should be charged in principle, start with and focus attention on the ones who have the more severe impacts on water quantity and quality.

  • Apply economic instruments, such as emissions trading schemes, or taxes on fertilisers and pesticides to reduce intensity of agricultural chemical inputs and foster expansion of integrated nutrient management such as nutrient accounting at the farm level.

  • Provide incentives to develop and disseminate technologies that reduce pollution and improve input efficiencies (e.g. water, pesticides and fertilisers). Technologies may include nitrification inhibitors, cover fertilisers, decentralised wastewater treatment technologies and artificial wetlands.

  • OECD requisites for the design of water pollution charges, taxes and water quality trading schemes (OECD, 2017a)

The total pollution load control programme

  • In addition to expanding the Korean TMDL to include the whole basin (including small/medium tributary rivers) and other water quality parameters linked to local ecological limits and social values on water quality, include all diffuse source polluters (including agriculture) in the programme.

  • Allow trading amongst point source polluters and between point source and diffuse source polluters within the Korean TMDL system to cost-effectively meet water quality goals whilst limiting restrictions on future economic development.

  • OECD requisites for diffuse pollution allocation and water quality markets (OECD, 2017a)

  • Water quality trading, Chesapeake Bay, United States (OECD, 2017a)

Reducing diffuse pollution from agriculture

  • Use targeted risk-based agri-environmental support payments or payment for ecosystem services in exchange for best farming practices (beyond mandatory good farming practices) in ecologically sensitive areas and drinking water sources.

  • Take a multi-dimensional approach to manure management beyond regulation to include incentives to invest in developing new technology, capacity-building and building partnerships between stakeholders. Enhance the partnership between livestock and crop farms to recycle and re-use livestock manure through on-farm application, biogas production and composting into organic fertilisers.

  • Collaboration with farmers and Payment for Ecosystem Services schemes in England (OECD, 2017a)

  • Co-operation with farmers for catchment protection in Munich, Germany (OECD, 2017a)

  • Comprehensive policy framework for livestock manure management in the Netherlands (Annex 2.A)


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Annex 2.A. Policy framework for livestock manure management in the Netherlands

The livestock sector in the Netherlands is important to the nation's economy, competitive in international markets and very intensive. The sector produces three to four times more manure than is needed for fertiliser use in the country. A single 500-sow farm producing 20 piglets per sow each year produces the same effluent as a town of 25 000 people, but on a much smaller land area. 80% of manure production (around 70 million tonnes per year) is from cattle, 18% from pigs and 2% from poultry.

The manure management approach adopted in the Netherlands is based on the premise that manure is a valuable product rather than waste and its valorisation can be a key driver of the circular economy. The Dutch manure policy focuses on both the production and the application of manure with the objective to optimise the use of manure through balanced fertilisation and suitable application techniques. The government supports this process through penalising polluters, while rewarding innovators and farmers who find ways to export manure. Their multi-dimensional approach entails: i) regulating the use of manure; ii) market-based instruments to facilitate innovation and investment in new techniques including financing R&D for innovative processing and manure management; subsidies and tax reduction; iii) capacity building for farmers through farmer networks; iv) partnerships between government, industry, NGOs and R&D institution; international co-operation through multi-stakeholder platforms such as the “Global Agenda for Sustainable Livestock”, the “Global Research Alliance on Agricultural Greenhouse Gases” and the “Global Partnership on Nutrient management”.

The cornerstone of the Dutch manure policy is a system of application standards for both nitrogen and phosphate on agricultural land. The legislation for using manure on land requires: i) Application rates: low maximum use of manure per ha land based on minerals phosphate and nitrogen; application in growing season; low emission application techniques, such as obligatory injection of liquid manure; ii) Enforcement: registration of production (livestock, crop and manure); compulsory processing of excess manure into products with high nutrient levels and a low moisture; iii) Obligation to reduce nutrient losses: build low emission housing; emission-free storage. Failing to comply results in an economic offence, which can be investigated and indicted under the criminal law. All farmers with a manure surplus must develop a disposal plan. Farmers who exceed permitted production levels face fines, and there is an escalating level of tax on commercial feed. A “Manure Board” regulates manure flows, provide manure for use in arable areas, and help find new manure users. It also conducts research, assists in the processing of manure and establishes treatment plants.

Another essential element of the Dutch manure management system is manure distribution from livestock farms with a nutrient surplus to arable farms that can use the nutrients in crop production. The most common use of animal manure is its application as fertiliser on agricultural land (90% of all manure). Manure application is only allowed when using low emission technology like manure injection on grassland and immediate covering with soil on arable land. The manure application period is limited to the early growing season of crops. By using animal manure as nutrient source for crops, more than 90% of synthetic phosphate fertilisers and more than 60% of synthetic nitrogen fertilisers have been replaced by phosphate and nitrogen from animal manure.

As of 2014, farmers with a phosphate surplus are obliged to process and export a percentage of this surplus. These percentages increase annually until the desired balance between manure phosphate production and available agricultural land or crop uptake in the Netherlands is reached. The percentages are higher for farms in the livestock concentration areas (south and east) than for farms elsewhere in the Netherlands. Large manure surpluses are produced mainly from pig and poultry farms, as they cover little land, while most dairy farms have land (50 ha per farm on average) and can apply part of the manure to their own land. Transport is expensive because manure consists largely of water. The livestock farmer has to pay approximately EUR 10 to EUR 23 per tonne to the transport company. The transport company will pay approximately EUR 3 to EUR 10 per tonne to the manure receiving arable farmer; the difference must cover the costs of transportation. Cost of manure transport within the Netherlands is around EUR 5 to EUR 20 per tonne. Reducing the water content and manure processing to increase organic matter and nutrient content make distribution more effective.

The evaluation of the Manure and Fertiliser Act 2016 concludes that the current manure and fertiliser policy reduces environmental problems. Agricultural production is economically and ecologically very efficient per unit of product, but because of its volume, environmental pressure remains high: although balanced fertilisation for phosphate reached in 2014 and nitrate surpluses have decreased, in southern sand region nitrate concentration exceeds the target, partly due to manure separation and manure fraud.

Over the coming years the focus of manure management policy in the Netherlands will be on three areas:

  • Manure processing: increases export potential for animal manure. In addition, to reduce veterinary health risks, the exported manure must comply with the requirements for animal by-products. Mechanical separation of manure (the initial stage of the processing of liquid manure), manure processing and anaerobic digestion are processing methods to improve export opportunities.

  • Animal feed: agreement with farmers and feed industry to: i) decrease the concentration of phosphate in the feed; and ii) develop innovations to create more cost-effective feed

  • Fertiliser replacement: upgrading animal manure to products with properties comparable to synthetic fertiliser; more use of renewable resources; fertilisers with high efficiency.

A key lesson from the Dutch approach to manure management is the importance of a coherent system of clear and realistic regulatory standards (e.g. nutrient application standards for agricultural land) which can be adapted as required by local circumstances. An efficient logistics system for manure storage and distribution is also indispensable, as well as accurate records, monitoring, administration and enforcement.

Source: OECD (2018, forthcoming), Innovation, Agricultural Productivity and Sustainability in Korea, OECD Publishing, Paris.

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