Freshwater is one of the planet's most scarce resources. Demand for it is growing, and climate change threatens its supply.

A new, free software tool, the Resource Investment Optimization System (RIOS), could be part of the solution. Using the RIOS approach in Colombia, for example, has improved the return on investment by up to 600 percent over previous approaches to watershed investment.

The simple, open-source software guides cost-effective investments in nature for clean and reliable water. RIOS was developed with partners in Latin America, where countries such as Colombia, Mexico and Brazil are experimenting with new conservation financing and water security mechanisms known as water funds. These funds are intended to improve the reliability of clean water supplies by managing the green infrastructure that supplies, regulates and cleans water.

RIOS incorporates local knowledge and preferences to help prioritize investments in watersheds. It has been field tested throughout Latin America and could prove useful anywhere in the world.

RIOS was developed by researchers from the Natural Capital Project at the Stanford Woods Institute for the Environment with funding from the Latin American Water Funds Partnership, which includes The Nature Conservancy, the Inter-American Development Bank, the Global Environment Facility and the FEMSA Foundation.

"This is a revolutionary way to think about infrastructure investments," said Mary Ruckelshaus, managing director of the Natural Capital Project and Woods consulting professor. "RIOS provides a scientifically sound and easy way to guide investments in nature in a way that is good for people and the environment."

RIOS offers a standardized and flexible approach to water fund design and investment by putting a value on water quality and other environmental returns through hydrological models, while accounting for preferences and requirements of stakeholders. For example, if a water fund manager has $10,000 to spend on improving a stream's water quality, RIOS can help determine the most effective investment, whether it's paying farmers to avoid cultivation near the stream, stemming area deforestation or building fences to keep animals away.

"RIOS represents a new approach to decision support for conservation science, because it came out of real projects sharing best practices and challenges," said Adrian Vogl, program manager for Freshwater Services at the Natural Capital Project and one of the primary designers of the RIOS software. "It is useful in many different contexts, and it lets people use their budgets more efficiently to increase the effectiveness of conservation."

RIOS grew out of the Latin American Water Funds Partnership's commitment in 2011 to develop 32 new water funds and spend $27 million to restore more than 7 million acres of watersheds. Until now, there was no effective way to decide which protection and restoration activities to invest in.

"This problem of where to invest in watersheds used to be so hard that people just paid any landowners who were willing to participate in water fund programs," said Heather Tallis, lead scientist at The Nature Conservancy and one of the lead designers of RIOS. "With RIOS, we can bring science and practicality into the picture."

The Natural Capital Project is a partnership with the Stanford Woods Institute for the Environment, the University of Minnesota's Institute on the Environment, The Nature Conservancy and the World Wildlife Fund aimed at aligning economic forces with conservation. The project works to integrate ecosystem services approaches into all major resource decisions that affect Earth's natural resources.

For more information about RIOS, visit