On the front page of the paper, I found this article as a part of the papers series, A World without Water. The article writer, Pilita Clark, claims that the cost of water for companies continues to rise.
Of all water users, according to Clark, agriculture consumes about 70 percent, business 22 percent, and domestic users, about 8 percent. Businesses attribute the increased cost to inefficient water management. To remedy this situation, companies have funded $84 billion.
Financially, businesses have initiated a number of programs: efforts to better "conserve, manage, or obtain water", according to Global Water Intelligence, a market analysis firm (p. 1). In the mining sector, BHP Billiton and Rio Tinto have committed to reduce "their use of fragile local water supplies" (p.1). The column references Moody's report, back in February 2013, entitled Global Mining Industry: Water Scarcity to Raise Capex and Operating Costs, Heighten Operational Risks.
In the manufacturing sector, Nestle has financed "new water-saving and treatment equipment at plants" (p. 1). Additionally, Nestle calculates a "shadow price" for water, which it determines depending on the water efficiency of new equipment and the general environment of the plant, whether arid or water abundant. The article cited the efforts of companies from "Ford to Google" and their concerns about water shortages. As data centers spring up all across the U.S., utilities face a company's requirement for "thousands of gallons daily to cool centres" (p. 1). Increased costs for water impacts the bottom line.
The reduction in the supply of water, from retreating glaciers to drought force companies to consider their options for obtaining and managing water. The competition among water users, from those who view it as a basic human right to farmers, utilities, and corporations that can purchase water rights, cause water, as it has been in the past, a highly contentious issue.
In the Analysis section of the paper, on page 8, the discussion continues. The article describes Coca Cola's investment in the River Nar, north of London. The company gave $1.2 million "to the World Wildlife Fund conservation group, which has dug a winding channel to restore a straight stretch of the river back to a meandering version of its older, natural self" (p. 8). Clark lists other companies and their initiatives to conserve, reduce, or improve water use: BG Group, an oil and gas company; Antero Resources, a shale gas company in the U.S.; EDF, another energy company in France; and SABMiller, a brewer with plants in Tanzania, South Africa, and India, among others.
Regulation, risk analysis, and the demand of investors to disclose water usage and costs, have made this topic more visible. Google explained to Clark, its attempt to improve water use at its data centers in Belgium, Finland, and the state of Georgia, in the U.S. As one of the members of the Carbon Disclosure Project, Norway's oil, sovereign wealth fund publishes "the risks and opportunities water poses for their business" (p. 8). Of the FTSE 500 companies that responded to a survey, 70 per cent "said water was a substantive risk to their business, up from 59 per cent in 2011" (p. 8).
The Analysis ends by addressing ground water pumping and depleting aquifers, rising populations and water demand pressures, and the responsibilities that rest on governments to regulate this natural resource.
https://www.moodys.com/research/Moodys-Water-scarcity-could-increase-rating-pressure-on-global-mining--PR_266225?WT.mc_id=
World Bank's Water Resources Group
International Desalination Association
Nestle, Mr. Brabeck
Global Water Intelligence
Carbon Disclosure Project
Jay Famiglietti, University of California
Leonard Konikow, USGS, groundwater expert
Laurent Auguste, Veolia, French water services group
Ceres, a sustainable investor group
Wood Mackenzie, an energy consultancy
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