Charting Our Water Future: Making Water Everyone’s Business
Going through “Charting Our Water Future“, a report by the 2030 water resources group, which, as its name implies, is looking at the future of water supplies in 2030.
A cursory look at the list of sponsors already tells me there’s a story here: the International Finance Corporation and McKinsey & Co. are the usual suspects. But what about The Barilla Group, The Coca Cola Company, Nestle and others that are also part of the report creators? The answer is inside: water scarcity will also affect manufacturing and industry as we know it.
The chilling truth in the report is known to all: population growth and developing economies together with climate change strain already stressed water resources.
“in just 20 years, this report shows, demand for water will be 40 percent higher than it is today, and more than 50 percent higher in the most rapidly developing countries”
However, as the report shows, there are measures to close the water gap, but these involve getting all water stakeholders to work together, on the govermental and country level.
Interestingly, the report describes water management as driven by opacity and lack of knowledge, and in turn attempts to give policy makers the ability to understand water related decisions from an economic standpoint. As the report notes:
“In the world of water resources, economic data is often insufficient, management is often opaque… as a result… water resources face inefficient allocation and poor investment practices…”
“Even in countries with the most advanced water policies there is still some way to go before the water sector is managed with the degree of sophistication appropriate for our most essential resource”.
One of the views that caught my eye in the report was the gap between how policy makers see the priority of making water investments and evaluating these water investments from an economic viewpoint.
Let’s say a country is facing water shortages. Should it invest in creating more water (desalination, for instance), improving its water infrastructure (investing in groundwater production and pipe networks) or try to get more efficiency gains (e.g. scheduling agricultural irrigation)?
The dilemma can be presented as follows:
Supply vs. Infrastructure vs. Efficiency
Governments tend to invest on the supply side, and sometimes, when infrastructure ages, in upgrading it. So, based on the knee-jerk reaction of policymakers, supply comes first, infrastructure second, and efficiency a distant third. However, as the report notes, the order should be the other way around. Both from an economic standpoint, but also if we were to close the water demand gap that is expected in 2030. Making water network more efficient is the golden path to resolving the demand gap. It is also the more sustainable way.
“Historically, the focus for most countries… has been to consider additional supply, in many cases through energy-intensive measures such as desalination. However, in many cases desalination – even with expected efficiency improvements – is vastly more expensive than traditional water supply infrastructure, which in turn is more expensive than efficiency measures, such as irrigation scheduling in agriculture. These efficiency measures can result in a net increase in water availability and even net cost savings….”
Here’s a great diagram from the report, comparing the costs:
What it shows is that desalination costs 0.7-0.9 $ per cubic meter, while investment in groundwater infrastructure also costs, albeit less. However, efficiency measures cost nothing from the viewpoint of the country as a whole.
The report mentions this very theme when assesing the costs required to address the future investment to make water meet demand by 2030:
“When scaled to total global water demand, this implies an annual capital requirement of approximately $ 50-60 billion to close the water resource-availability gap, if done in the least costly way available, almost 75% less than a supply-only solution”
For people familiar with TaKaDu’s vision, this is exactly the claim we’ve been making: saving water, by reducing water loss, while at the same time letting utilities do more with less, is the best way to assure more water supplies for our future.
Entry filed under: Smart Water Grid, Water Cost, Water Scarcity. Tags: 2030 Water Resources Group, Aging Infrastructure, charting our water future, desalination costs, Energy Efficiency, International Finance Corporation, McKinsey & Co, Smart Water Grid, the water gap, Utilities, Water Infrastructure Monitoring, Water Loss, Water Pipe Replacement, water supply policy.