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Financing Water Adaptation in Jamaica´s New Urban Housing Sector

Description of Project

In March, 2017, the Inter-American Development Bank (IDB) and the Jamaica National (JN) Group signed two Cooperative Agreements, which provide the JN Bank and the JN Foundation with funding to execute a four-year project entitled “Financing Water Adaption in Jamaica’s Housing Sector”, also referred to as The Water Project Jamaica.

The project was designed to address water management issues related to climate change, which is the most serious threat to sustainable development facing Small Island Developing States (SIDS). In the case of Jamaica, drought and shifting patterns of rainfall will exacerbate serious challenges already impacting the country’s water supply and distribution system such as capital and operational budgetary constraints, aging assets, population growth, urbanization and environmental degradation. There is also the problem of inconsistent water supply negatively impacting local communities as well as the business models of housing developers and construction companies. In addition, limited financing and an uncertain business case for water adaptation are barriers to the uptake of water efficient measures by the housing development sector.

The project comprises two main components:

The Loan Component is funded by the Pilot Program for Climate Resilience (PPCR) through the IDB and the Technical Assistance Component is funded by The PROADAPT Facility of the Multilateral Investment Fund (MIF) with counterpart resources provided by the JN Foundation.

The Loan Facility involves the on-lending of funds for the integration of water adaptation measures in Jamaican housing and will be administered by the JN Bank. The loan will facilitate the installation of water saving measures and technologies that would not otherwise have been purchased. The installation will reduce water demand and improve supply, thereby allowing householders to save on their water bills and build climate resilience.

The Technical Cooperation Component has four sub-components and will be administered by the JN Foundation. These sub-components include: (a) demonstrating the business case for water efficiency for developers and construction companies, and the financial case for water adaptation in households, (b) building local capacity to design and install water adaptation measures, (c) supporting a climate resilience entrepreneurship program, and (d) raising awareness of the threats of climate change and the related opportunities presented by water efficiency by local businesses, financial institutions, civil society and the Government of Jamaica.

Project Objective

The project seeks to enhance Jamaica’s climate resilience through the use of water adaptation technology in the country’s housing sector.

The specific objectives are to:

  • facilitate the uptake of water adaptation measures in the housing sector across Jamaica, including the use of rain water harvesting systems, water efficient taps and showers, low-flush toilets, efficient irrigation systems, grey water recycling facilities, among other appropriate efficiency measures;
  • increase climate resilient housing in Jamaica, through greater awareness of the business and financial cases for developing and building homes with water efficient measures; and
  • increase the efficiency in the use of water by Jamaican homes, improve the reliability of water supply and thereby enhance Jamaica’s water security and climate resilience.

Who will benefit?

The beneficiaries include:

  • Householders will benefit from water savings and greater water security;
  • Small local businesses and technicians will benefit by suppling water efficient solutions;
  • Housing developers and construction companies will benefit from loans to incorporate water efficient technologies;
  • Young Jamaican entrepreneurs will receive training on business opportunities;
  • The JN Bank will benefit from capacity building to incorporate climate resilience into their loan scheme;
  • Technical professionals involved in the design and specification of home construction;
  • National Water Commission will benefit from greater water use efficiency; and
  • Other households in Jamaica will indirectly benefit from reduced stress on the water supply.
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