Crops, Climate and Environment, Water


Innovation (technical or institutional), Technology


East and Southern Africa

"Sustainable watershed stewardship."


The upper Tana river is polluted by urban waste. Soil is eroded and flows are compromised by poor farming practices.

Private-public partnership the Water Services Trust Fund provides money for sustainable land and water management and conservation work in the Tana watershed area, from policy level to end-user groups.



Sustainable resource management

Green infrastructure practices use natural systems to trap sediment and regulate water flow. They are often cheaper than traditional reservoirs and water treatment systems.

Conservation of watershed environment

The fund promotes policies and incentives that support sustainable watershed stewardship and land management. This includes tree-felling practices that maintain soil integrity and help prevent erosion.


The WSTF project can offer

  • Experience of setting up a private public partnership (PPP) to address watershed environment issues


Countries involved


Project partners

Community Forest Associations

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Forests and wetlands in the Upper Tana River basin play an important role in maintaining water quality and quantity, providing areas where runoff water and sediment can be stored an filtered naturally. However, since the 1970s, forests on steep hillsides and wetland areas have been converted for agriculture. As a result, sedimentation is becoming a serious problem, reducing the capacity of reservoirs and increasing the costs for water treatment.

The Water Services Trust Fund (WSTF) is a Kenyan State Corporation established under the water act of 2002 and mandated to finance water and sanitation services for the poor and underserved communities in rural and urban areas.



Various environmental risks are being faced in the Tana River basin due to the degradation of water catchment areas and forests.

Settlements, poor farming practices such as overgrazing and over-cultivation, and the felling of trees without replantation all give rise to increased soil erosion and decreasing water flows. As a result, 60 per cent of Nairobi’s residents are currently water insecure, while 95 per cent of the water used and consumed in Nairobi comes from the Upper Tana catchment.

There is also a growing threat of river contamination due to inadequate treatment of wastewater from Nairobi City and illegal dumping in the Nairobi River. Both agricultural and industrial water discharges and sewage inflow have degraded the water quality of the country’s lakes.

These challenges to water security will likely be exacerbated by climate change and the consequently unpredictable rainfall.



As a Kenyan public-private partnership (PPP), the WSTF is designed as an environmental financing mechanism to support sustainable land management, water and soil conservation measures, and integrated natural resource management in the Upper Tana catchment area. It is founded on the principle that preventing water problems at the source is cheaper than addressing these issues further downstream.

Funds will be made available to support smallholders in sustainable watershed stewardship and to improve the Upper Tana catchment ecosystems. This will be accomplished by increasing the land area, freshwater, and agro-ecosystem under integrated natural resources management. The grants from the Fund are being provided to Community Forest Associations (CFAs) and Water Resources Users Associations (WRUAs).

In Kenya, the UTNWF will be piloted in three counties of the Upper Tana River basin, which covers 17,000 km2 with 5.3 million inhabitants. The basin includes two of Kenya’s five 'water towers'. Maintaining these towers is a key environmental, agricultural and economic priority for the Kenyan government.

The project will work with public and private sector partners to establish the WSTF as a sustainable financing mechanism. Increased investment flows will serve to foster adaptation and increase the resilience of the local population by improving food production and household incomes.

The first component is to establish the Water Fund (WF) as a Charitable Trust governed by a Board of Trustees. The WF’s finance mechanism will include a periodic replenishment through fees and further contributions by public, private and international donors.

In terms of its financial management system, it has a fully-fledged financing department that is audited by a reputable firm. Its financial management capacity is assessed as highly satisfactory and its funds absorption capacity is good, as indicated by the growth in rural disbursements over the last three years from KSh 273 million to KSh 735 million (USD 8.6 million).

Additionally, grants will be treated as expensed and replenished at the point of disbursement, which minimizes the time beneficiaries will have to wait until approval. On average approval happens within 90 days. 

In order to disburse funds, clear indicators for the targeting and prioritization of initiatives and stakeholders will be developed. This will be aided by the establishment of national and county level advisory structures, so as to be responsive to local requirements.

The financial and technical support provided to these initiatives are based on a modelling approach that links spatial prioritisation with an impact assessment for soil and water conservation, and an analysis for return on investment.

Financial and technical support can be provided in the form of…

  • Establishing a baseline of priority locations that factors in riparian (watershed) management and wetlands protection for vegetation buffering along riverbanks

  • Reforestation and adoption of agro-forestry practices to reduce greenhouse gas emissions and increase carbon stocks

  • Terracing of hill slopes on steep and very steep farmland as a measure for road erosion mitigation and quarry management.

  • Direct incentives (tree seedlings or support for village nurseries)

  • Non-financial incentives (e.g. capacity development, or support to village institutions) or payments for ecosystem services (e.g. subsidised biogas plants for good riparian management).

The advisory bodies of the Water Fund will provide further detail on how to specify these incentives to ensure the most vulnerable members of the target audience are reached.

Lastly, the project aims to establish an information centre to disseminate and scale up these results.



The combination of biophysical and agricultural techniques and support for water management is expected to lead to a diversified production and increased yield through improved soil retention. As well as a broadened adaptation potential and resilience through reduced erosion upstream, and stabilised catchment ecosystem services.

Downstream economic benefits will include reduced water treatment costs as a result of decreased sediment concentration and increased hydropower generation, which in turn is possible through higher water yield.

Green Water Services (GWC) has estimated that an intervention of this magnitude would generate about USD 2.0 million per annum in benefits to downstream areas. Furthermore,  approximately 200,000 farm households will derive benefits over the life of the project. This figure represents 20 per cent of the project area's population.

The use of micro-irrigation techniques and piped conveyance systems has the potential to greatly improve water use efficiency. The project will upgrade irrigation systems on about 1,000 ha of land, creating savings in water use of about 5,000 cubic metres per hectare.  The value of water saved and available for downstream usage is estimated at KSh 90 million (USD 1.0 million) per annum. The project is expected to generate an overall economic rate of return of around 20 per cent.


Lessons learned and potential for replication

One lesson emerging from this solution is that the setting up of a PPP is time consuming and should therefore start as early as possible. At this time there are no other significant lessons.


Next steps  

The next steps are to accelerate the implementation of the small projects supported by the WSTF and to carefully assess their impacts and sustainability. 

Solution Additional Resources

Nairobi Water Fund: A First for Africa (Video)

Last update: 09/08/2018