Water

Abstraction of water for the extraction of natural resources

The abstraction of ground and surface water may be necessary during the extraction and further processing of natural resources. The volumes of water abstracted in Germany for the activities of the natural resources extractive sector are published by the Federal Office of Statistics based on the data of the responsible statistical authorities of the Federal States.¹

The mining and quarrying sector abstracted a total of 1,289 million of m³ of water in 2019 (mainly groundwater). groundwater). Coal mining accounted for around 75% of this volume. This corresponds to around 6.5% of all water withdrawn by industry in Germany in 2019.² Depending on the regional importance of the extractive sector – especially coal mining – the proportion is higher in some Federal States (in some cases more than 50%).³

Use of water

During the initial development of a deposit of natural resources, the pumping out of groundwater can lead to a lowering of the groundwater level. Water abstractions during extraction of the natural resources may also be necessary e.g. to keep shafts or excavation pits dry. If necessary, this so-called drainage and mine water is treated, purified, seeps away or is reused, if applicable, complying with the approval conditions, e. g. to maintain moist biotopes or introduced into surface water without being used further.

The use of water by the mining industry is associated with consequences for the water balance. Environmental impacts may result, inter alia, from changes in groundwater levels, the flow velocity of water bodies and the discharge of marsh and pit water into surface water bodies.

Example: Use of water in potash and rock salt mining

In potash and rock salt mining, water from different origins and of different quality levels including river water, groundwater and drinking water is used in many processes.

Raw salt is mined by means of drilling and blasting in the underground mining of potash and rock salt. However, salt can also be extracted in a brine plant, where fresh water is introduced into soluble (salt) rock by means of a borehole, resulting in the creation of chambers filled with salt water. The salt-saturated water (so-called brine) is then conveyed to the surface via another pipeline. The salt is extracted when the brine evaporates.

Legal framework for water abstraction

The Water Resources Act that came into force in 1960 dictates that water can only be abstracted from the groundwater and surface water if a permit has been granted in which this usage has been regulated in terms of the nature and quantity of usage. An EU-wide legal framework for the protection of water and groundwater was created in 2000 with the Water Framework Directive 2000/60/EC of 23 October 2000 (WRRL). The WRRL stipulates (inter alia) that the costs of water services (including certain water abstractions) and environmental and resource-related costs are covered by the polluter-pays principle.⁴ Water abstractions must also be checked for compliance with the general environment targets of the WRRL. If the volume of ground or surface water abstracted exceeds certain thresholds, environmental impact assessments must be carried out for the projects concerned.

The implementation of the WRRL into national law took place in Germany through the Water Resources Act, which regulates the protection and use of surface and groundwater at national level. Water abstraction procedures are subject to the reservation on the granting of permits by the water authorities. The State Water Acts of the Federal States supplement and concretise the federal water laws. Overall, the Federal States are left to regulate the water abstraction fees.

[1] In its ruling of 11 September 2014 (docket ref. C-525/12), the European Court of Justice (ECJ) confirmed that with these regulations of the Federal Government and the Federal States, Germany had sufficiently implemented the principle of cost recovery from the EU Water Framework Directive. The ECJ also expressly points out that in accordance with the provisions of Article 9(4) of this directive, the EU Member States are in any case empowered not to apply the cost-covering principle to certain water uses, while addressing the purposes and objectives of the directive.

Structuring of water abstraction fees

The structuring of fees for water abstraction is carried out by the Federal States that receive these fees. This is why water abstraction fees levied in Germany differ widely in 13 out of 16 Federal States. In Hesse, Bavaria, and Thuringia no water abstraction charges are currently levied. The total revenue in the 2024 budgetary plans of the Federal States was estimated at around €452.9 million. These revenues are partly used for water management tasks, or they flow into the general budget of the respective Federal State.⁵

Most Federal States levy consumption-related fees for the abstraction of ground and surface water.⁶ Depending on the individual structure, these fees are also intended to reflect the “value of the public services” for the utilisation of resources and can therefore function as incentive taxes for a sustainable water management programme and for the allocation of environmental and resource costs (Section 1 and Section 6a of the Water Resources Act).

In most Federal States, levy rates differ according to the type of abstraction, volume, origin of the water (surface water or groundwater) and the purpose for which the water is to be used. There are also various state-specific deviations from the relevant rules through exemptions or discounts, and these may also apply to the extractive sector.

Water abstraction fees in the natural resources sector

Quite different rates are levied nationwide for the abstraction of water in the extractive sector. For example, fees of between 0.5 and 6 cents/m³ for surface water are applied in some Federal States for certain types of mining operations (e. g. in Baden-Wuerttemberg, Lower Saxony, Mecklenburg-Western Pomerania), while in other Federal States, the fees for groundwater abstraction can range from 5 to 18 cents/m³.

In some Federal States, including Rhineland-Palatinate and Schleswig-Holstein, on the other hand, groundwater excavation is exempt from water abstraction charges. In some Federal States, there are explicit regulations for dewatering operations in mines, or for water that is reintroduced into surface waters without being subsequently used.

The various fee levy rates, exemptions and discount rules are published in the individual State Water Acts or ordinances of the Federal States. The German Federal Environment Agency provides an overview of the relevant fee levy rates in the extractive sector.⁷ However, a publicly accessible source of information on the amount of revenue from water abstraction fees paid by the extractive sector does not exist in all Federal States. Reports on this are regularly given to the State Parliament in North Rhine-Westphalia.

Water abstraction fees represent a flow of cash between companies that extract natural resources and the German State. Due to the different levy rates (inter alia) in individual Federal States, most payments lie below the materiality threshold agreed in the D-EITI, which is why they are not disclosed as a payment flow in the D-EITI report. Where companies in the extractive sector have reported water abstraction charges above the materiality threshold of €100,000, these can be found in the BilRUG payment reports.⁸

Water abstraction in the natural resources sector by Federal State in 2019 (in thousands of m³)

Source: Federal Statistical Office, own presentation.

¹ Federal Statistical Office (2022): Environmental economic accounting. URL: https://www.destatis.de/DE/Themen/Gesellschaft-Umwelt/Umwelt/UGR/_inhalt.html (accessed 9 October 2024).

² Destatis, Fachserie 19 Series 2.2 (2023). URL: https://www.destatis.de/DE/Themen/Gesellschaft-Umwelt/Umwelt/Wasserwirtschaft/Publikationen/Downloads-Wasserwirtschaft/wasser-abwasser-nichtoeffentlich-2190220199005.xlsx?__blob=publicationFile (accessed 9 October 2024).

³ For example in Saxony, see Office of Statistics of Saxony (2022) “Water supply and wastewater disposal in the non-public sector in the Free State of Saxony”. URL: https://www.statistischebibliothek.de/mir/servlets/MCRFileNodeServlet/SNHeft_derivate_00009499/statistik-sachsen_qI2_wasserversorgung-nichtoeffentlich.pdf (accessed 9 October 2024).

⁴ In its ruling of 11 September 2014 (docket ref. C-525/12), the European Court of Justice (ECJ) confirmed that with these regulations of the Federal Government and the Federal States, Germany had sufficiently implemented the principle of cost recovery from the EU Water Framework Directive. The ECJ also expressly points out that in accordance with the provisions of Article 9(4) of this directive, the EU Member States are in any case empowered not to apply the cost-covering principle to certain water uses, while addressing the purposes and objectives of the directive.

⁵ Verband kommunaler Unternehmen e.V. (Association of municipal enterprises) (VKU) (2024): Comparison of water abstraction charges in the Federal States. URL: https://www.vku.de/themen/preise-und-gebuehren/artikel/aktualisierte-vku-grafik-stand-2024-wasserentnahmeentgelte-der-bundeslaender-im-vergleich/(accessed 17 September 2024).

⁶German Federal Environment Agency (UBA) (2022): Overview of Federal State regulations on water abstraction charges. URL: https://www.umweltbundesamt.de/sites/default/files/medien/2875/dokumente/tabelle_wasserentnahmeentgelte_laender_stand_sept_2022.pdf (accessed 26 September 2024).

⁷German Federal Environment Agency (UBA) (2023): Table “Overview of Federal State regulations on water abstraction charges” of August 2023. URL: https://www.umweltbundesamt.de/sites/default/files/medien/2875/dokumente/20230807_tabelle_wasserentnahmeentgelte_im_rohstoffsektor_uba.pdf (accessed 17 September 2024).

⁸ For 2022, the following companies reported payments of water utilisation fees in accordance with Section 341v HGB: LEAG Lausitzer Energie Bergbau AG: €541,044.93 EUR; RWE Aktiengesellschaft €13,218,419; source: Annual payment reports – www.unternehmensregister.de.