Real cost of water

The low nominal cost of water in many regions means that a lot of investments aimed at cutting its use don’t seem to offer satisfactory returns. The picture may change when organizations take a broader view of water: as a “carrier” of production inputs and outputs to which a variety of costs and recoverable values can be assigned. Since these elements may total as much as 100 times the nominal cost of water, optimizing its use can yield significant financial returns, says a McKinsey report.

One pulp-and-paper company analyzed its water-use costs as a carrier, including tariffs, charges to dispose of effluents, and water-pumping and heating expenses. It also examined the value of recoverable chemicals and raw materials “carried” by water from its factories and the potential heat energy lost in cooling processes. By closely surveying these operations, the company identified opportunities for better water storage and for reducing chemical use in paper bleaching. Additionally, the company recaptured heat from condensation processes and reduced the amount of steam consumed by boilers.

These moves saved nearly 10 percent of measured carrier costs, reducing total operating expenses by 2.5 percent and improving sustainability by cutting water use nearly in half. Industries such as steel, packaged goods, chemicals, and pharmaceuticals have similar carrier cost–value profiles. Companies may be able to identify substantial savings by focusing on the broader economic costs of water.

Tale of two approaches

Bhutan is now famous for the term GNH or 'gross natural happiness' coined by its ruler. Called the poster child of sustainable development, more than 95 per cent of its population has access to clean water and electricity and live in perfect harmony with nature. With 80 per cent of its land forested, Bhutan is the only country that is near carbon neutral and food secure. To add to its happiness basket, Bhutan has decided to become the first country in the world to turn its agriculture completely organic, banning the sales of pesticides and herbicides and relying on its own animals and farm waste for fertilisers. Being predominantly a Buddhist country, living in harmony with nature is part of its spiritual and cultural heritage. The government expects to grow organic food for its 1.2 million people and export the surplus.  

Elsewhere across the globe there is a contrasting phenomenon spreading wings. Called "land grabbing," this practice can put strain on land and water resources in impoverished countries where the land, and water, is being "grabbed" for commercial-scale agriculture. A new study by the University of Virginia and the Polytechnic University of Milan, and currently published in the online edition of the Proceedings of the National Academy of Sciences, provides the first global quantitative assessment of the water-grabbing phenomenon, which has intensified in the last four years largely in response to a 2007-08 increase in world food prices. Countries most active in foreign land acquisition are located in the Middle East, Southeast Asia, Europe and North America. Overall, about 60 percent of the total grabbed water is appropriated, through land grabbing, by companies in the United States, United Arab Emirates, India, United Kingdom, Egypt, China and Israel.

Instead of looking at ways to optimize on resource use and conserve them for tomorrow, this speaks of short-term outlook of exploitation. Any doubts, which brings happiness – plunder or harmony with nature?

Virtual water looms large

A new study calculates that about one-fifth of all water goes toward the production of crops and commodities for export, part of a global phenomenon known as “virtual water” that researchers say could place pressure on finite water supplies in some nations.

Using worldwide trade indicators, demographic data, and statistics on water use, researchers from the University of Twente in the Netherlands mapped the world’s water footprint, including patterns of trade they say are creating disparities in water use.

According to the study, published in the journal Proceedings of the National Academy of Sciences, many desert and island nations are becoming increasingly dependent on water from other countries, as they import not just food products but the water needed to produce it. The nations most reliant on this virtual water include the island nation of Malta, which is 92 percent dependent, Kuwait (90 percent), Jordan (86 percent) and Israel (82 percent).

Some of the most water-rich nations — including the U.S. and Japan — are also among the biggest importers because the products they import require so much water to produce.

Truly a global challenge. It is no more possible to fix blame on any nation or region in these times where the world has become a global village.

Meanwhile, in connection to what we discussed yesterday about jobs and the renewable industry, clean energy jobs in the EU have now passed the 1 million milestone. According to a new report out by the European Commission, The State of Renewable Energies in Europe, 1.14 million people were working in the clean (or green) energy sector in 2010, after a 25% increase in jobs in that sector that year (compared to 2009).

Water rights

As the summer sun intensifies, parched earth and thirsty mouths seek water, it is once again time to ask some tough questions. Should access to clean, safe water be declared a human right?

In July 2010 the United Nations (UN) agreed to a new resolution declaring the human right to “safe and clean drinking water and sanitation”. One hundred twenty-two nations voted in favor of the resolution; 41 (primarily developed) countries abstained; and there were zero “no” votes. According to the declaration, approximately 884 million people lack access to safe drinking water.

A recent World Bank study predicted that demand for fresh water will exceed supply by some 40 percent within just two decades.

Approximately one out of every eight people does not have drinking water. In just one day, more than 200 million hours of the time used by women is spent collecting and transporting water for their homes.

The resolution itself carries no regulatory weight, but backers view it as important to raising awareness of the problem and engendering support for solutions. Governments, aid agencies and the UN must take their responsibilities seriously.
However, some developed countries—including the U.S., Canada, Australia, New Zealand and several European nations—tried to block passage of the resolution in hopes of minimizing their future obligations.

A recent study shows urban growth rates alone leaving 993 million city residents living on less than 100 liters of water a day. (The 100-liter-per-day benchmark comes from the World Health Organization and the U.S. Agency for International Development.) The average American uses 376 liters a day.

When issues like climate change with its potential for damage could not evoke a consensus, it is perhaps naive to expect nations which do not suffer immediate water crisis to pitch in and help the poorer nations. But the UN resolution at least has raised some awareness on the issue.

What do you think? Would declaring it a human right help the situation?

Power down the pipe

Water distribution is the most energy-intensive activity in high and dry places. An estimated one quarter (25%) of America's electricity consumption is associated with moving and treating water. Is it any different in your city? Let us know.

Southern Nevada used about 853.8 million kilowatt-hours of electricity in 2008 to move 439,187 acre-feet of water into valley homes and businesses, according the Southern Nevada Water Authority. Another 119.2 million kilowatt-hours of electricity was used that year to treat 22,501 acre-feet of water and send it back to the lake.

When the power is mostly from coal, that means something! Utah is 93% coal dependent and has the largest average household size (3.01) - meaning water consuming appliances will be used intensively in the average home. The per-capita water consumption average in Utah is 250 gallons, way over the 75 gallon national average, with 60% of all water consumed going for yard irrigation.

The national standard in India is around 200 litres per capita per day and even in its silicon valley, Bangalore, the availability is much lesser. Equity issues aside, to pump around 900 mld of water from 300-600 depth, the BWSSB spends about 65 percent of its income (Rs 140 crores) on power!

What can you as a citizen do? For one, harvest rainwater and use recycled water for cleaning cars! Not water pumped from such distances at such costs, such power! Reduce your water print. And share your ideas.

Price for water

Much water is required for a nuclear or coal (fossil fuel) power plant. The World Resources Institute estimates that nearly two out of every three gallons of fresh water drawn from the U.S. Southwest is used to cool power plants.

Nuclear plants, of course, are the biggest water hogs. Given the water scarcity scenarios looming globally, does it makes sense to build hundreds of new costly nuclear plants, each with a life of more than 50 years? If water shortages will mean shutting them down?

Power from the coal-fired plant is cheap because the water it uses is not accounted as also its emissions. Should the water factor be accounted for? Should the plants be charged for the water they use? More important, instead of building more and more plants, why not go for decentralised generation that uses the resources available locally? Even if it's poo power!

The Guardian reports that the German town of Lünen, will become the first town in the world to have its own dedicated biogas network. The 6.8 MW power plant at the heart of the network with take cow and horse manure, as well as other agricultural waste and spoiled crops from surrounding farms, and process it all into biogas, which will be used to generate both heat and electricity.

When completed it will generate enough power to supply about 26,000 homes. About 30-40% of the town's heat and electricity will be provided through the biogas network.

Unquenchable

By 2030, nearly half of the world’s people will be living in areas of acute water shortage. The world needs to act urgently to avoid a global water crisis due to increased population, rising living standards, dietary changes and more biofuels production, the United Nations warned last week.

The impact could be large for some countries, including China and India, and for some regions of large countries, such as the United States, the report says.

The report jointly produced by more than two dozen UN bodies and titled, "Water in a Changing World," made "clear that urgent action is needed if we are to avoid a global water crisis."

Needless to say, as water availability goes down, so will food production. Do we realize the enormity of the prediction?

The population growth rate means demand for fresh water is increasing by 64 billion cubic meters a year. Most of North Africa and the Middle East have already reached the limits of their water resources. Migration to cities, increasing consumption of meat, biofuels, etc are seen as some of the reasons of rising water use.

This is where the connection between energy and water comes in. Just as energy is a component of the water distribution and access, water plays a crucial role in the way most of our energy is generated. Just as 2,500 liters of water is needed to make 1 liter of biofuel, our thermal plants require a large quantity of water. It becomes important then to look at energy sources that require less water.

‘Water policies play a big role but in many countries water policies failed to make any impact because key decisions affecting water were made in other sectors of the economy.’ When giving permits for tech parks, is the concerned ministry taking into account the demand on water from these? NO. Isn’t it time these aspects are given their due importance?

Is it enough to go by demand side management or should we adopt a price-based management of water? That is a question worth pondering over.

As we have covered in this blog earlier, if we are to manage water better we need to inventories water usage in every sector. There are no such records as of now. Can we begin the process, at individual households to various sectors?

Trickle of energy

IBM will soon launch a water management system for utilities that it says will bring much-needed intelligence to the treatment and distribution of water and also save up on much energy.

The system, using sensors, will automatically collect all sorts of important data — like water quality, pump rates, and water use at meters — analyze these and then package it into easy-to-consume formats for water managers to evaluate and take quick decisions. The company is eyeing markets all across the globe.

IBM also said it had made a “major breakthrough” in its development of an energy-efficient membrane for water purification.

A 2008 JP Morgan study predicted that by 2025, major economies, including the U.S., Western Europe, China and India, will likely experience significant water problems as consumption outstrips. In the US west, like parts of California, water scarcity is already being felt and its repercussions on agricultural productivity predicted.

The fact that most big tech players are pitching for the water market is proof enough of the crisis waiting to explode as water scarcity becomes a widespread reality. Given the population which is set to touch 7 billion by 2012, and that average health standards prescribe 3500 calories per day per person and 247,000 gallons of water per year per person, we are already in a mismatch situation. There is room only for 5 billion.

Are we doing enough to conserve water? As one of our blog readers Sudhakar advises, can each one of us pledge to sow and nurture at least two saplings every year, and devote a small patch of the soil for water conservation? Can we look for 2-3 simple ways in which we can curb our water use?

What's your water print?

According to a report released February 26 by the Pacific Institute and Ceres, industries and investors are not paying sufficient attention to their water uses and needs. This spans the range from tourism, beverage, agriculture, power and chipmakers, all of which are water intensive.

While carbon footprint seems to be picking up (as a fashion?) not much is being done about water. Considering that one of the most painful fallouts of climate change will be water scarcity, this is unfortunate.

The Pacific Institute notes how water inventories are an absolute must if we are to manage this most precious resource. Only then can reduction and conservation measures be implemented. Indirectly by managing well, associated energy costs can be reduced.

Of the 190 water-intensive companies interviewed, only 20% looked at real risks of water shortages, and only 10% looked at supply chain risks. Almost no companies disclosed water use or looked at climate change impacts to water use.

The report outlines specific actions for companies to practice responsible water management and increase disclosures regarding water use to shareholders.

The jean company Levi Strauss & Co. has been a leader in supply chain analysis and reduced the amount of water used to make jeans by insisting that laundries that pre-wash their jeans meet strict water conservation guidelines. Some others like Coca-Cola and Intel have begun to disclose the amount of water they use in financial reports.

It is up to the public to demand to know such details as the world gets ready to face a water-stressed tomorrow. A chip making unit, to set up which many of the cities in India made a bid, was expected to use up almost three times the water daily as used by an average city. If this detail had been available to the public, would it have allowed such a unit to be set up?

Not to say we do not need such units but there must be every effort to recycle and conserve water as also energy.

What, for instance, is your company’s water footprint?