Two new reports state that better water management is vital to both the U.S. and global economies. According to new reports from the U.S. Environmental Protection Agency (EPA) and the Carbon Disclosure Project (CDP), increased competition for water, aging infrastructure and unsustainable water use is putting businesses and communities at risk. The newly formed Value of Water Coalition, of which Xylem is a founding member, includes many of the key public and private members of the water industry and aims to raise awareness of these issues.
The EPA’s new report “The Importance of Water to the U.S. Economy” states that the U.S. is already facing problems caused by water shortages, which can have ripple effects across the entire economy. Recent droughts, for example, not only damaged agricultural productivity in large areas of the country, but could also have long-term impacts on the price for wheat and beef, as well as causing potential erosion in U.S. cotton exports.
Although water is often a local resource, the report states water use is connected at a regional, national and international level through commerce and trade. Energy production, water supply and food production, for example, are so closely related that “changes in one sector can have a direct and significant impact on the demand for, and availability of, water to others.”
“Available data does not reflect water’s true worth in the economy,” writes EPA Assistant Administrator Nancy Stoner in a blog post about the report. “As a result of water being undervalued, current use may be inefficient and unsustainable. Also, competition for water will increase as consumption rises, water quality decreases, and the impacts of climate change are felt.”
According to the report, aging infrastructure, unsustainable groundwater use and degraded surface water can also directly affect businesses and the economy. The report concludes that “protecting and efficiently managing our water resources is essential to maintaining a strong, vibrant economy.”
More businesses focusing on water risks
Many businesses around the world are beginning to understand how water risks affect their bottom line. At the World Economic Forum in Davos this year, for example, water risk was named as one of the top four risks facing business in the twenty-first century.
A new report from CDP, an international, not-for-profit organization, shows that several large corporations are taking the risks associated with water use more seriously. This year’s “CDP Global Water Report 2013” surveyed 593 large corporations that together represent 11 billion megaliters of water withdrawals per year, which is enough to provide 50 liters of water per day to the world’s current population for nearly 82 years.
More than half of respondents (53 percent) to the CDP survey have already experienced detrimental impacts related to water in the past five years. Furthermore, almost three quarters of respondents (70 percent) identified water as a substantive business risk, with the majority (64 percent) of reported risks expected to have an impact now or within the next five years.
The report also found that “respondents’ water stewardship activities are notably lacking, potentially exposing their company and investors to risks that could be mitigated.” The report suggests that corporations must look beyond efficiency measures in their own operations and consider supply chain and watershed management, as well as community and stakeholder engagement.
Real challenges that must be met
In order to raise awareness of the importance of water infrastructure to society as a whole, recently a number of private and public members of the water industry in the U.S. formed the Value of Water Coalition.
“We’ve long encouraged the water industry to unite behind an undeniable message about the value of water,” says Angela Buonocore, Senior Vice President and Chief Communications Officer at Xylem.. “This is the first time such a broad coalition of water businesses and nonprofit associations has come together as a single voice.”
The Coalition, which includes members such as the Water Environment Federation, the National Association of Water Companies, American Water Works Association and Xylem, along with many others, recently launched the website www.thevalueofwater.org as a hub to share the latest news and information on water-related issues.
“Every individual, family and business across the United States depends on safe and reliable water service,” said Michael Deane, Executive Director, National Association of Water Companies. “The current condition of our nation’s water infrastructure puts that service in jeopardy and inaction only allows it to worsen. Americans must understand that these are very real challenges, but they can and must be met.”
In order to better support water management, Xylem has published the white paper “Water and Urban Resilience: Solutions for a Water-Scarce Future” with examples of how investments in water technology can bring significant benefits for businesses and communities.
To learn more about water risks in your area of the world, visit the World Resources Institute’s Aqueduct project, a global water risk mapping tool that helps companies, investors and governments understand where and how water risks and opportunities are emerging worldwide.