US Water Sector on the Verge of Transformation

 Failure to act now could lead to major problems of water supply for both industrial, agricultural and consumer use. 

GLOBE-Net, May 23, 2013 – A new White Paper by Ernst & Young says the US must act quickly to address a number of critical water challenges, including increased water scarcity, aging infrastructure, climate volatility, water quality issues and water-related energy risks. 

Failure to do so could lead to major problems of water supply for both industrial, agricultural and consumer use. 

The report -The US water sector on the verge of transformation -argues the water and wastewater sectors must address several structural and financial impediments that hamper the adoption of system innovation and efficiency-focused strategies. 

Many best practices have been developed that could meet these challenges by improving the long-term financial viability of water systems and decreasing water consumption and water pollution. 

[stextbox id=”custom” float=”true” width=”200″ bcolor=”add3d5″ bgcolor=”add3d5″ image=”null”]Given the crucial nature of water sustainability, it is imperative to invest in water infrastructure, innovative technologies and new approaches. [/stextbox]

As well, mobilizing stakeholders to support new investment and structural reforms will require more forceful communication of the challenges, action plan and anticipated results. 

According to the report, fact-based leadership can help bridge differences and bring stakeholders together to support market reforms. More quantitative transparency is needed regarding water scarcity, allocation and true costs to overcome the inertia regarding the need to innovate water systems across the US. 

Venture capital investment in US water

 Venture Capital Investment In Water

Proposed Action agenda

Ernst & Young has put forward the following action agenda to navigate the US water sector through the transformation process:

  1. Develop the data and transparency practices needed to establish consistent, comprehensive pricing models that reflect the true economic value of water, inclusive of sustainability and social values.
  2. Improve quantitative management by establishing common terminology, standards and comparable metrics for water disclosure and footprinting.
  3. Consider the opportunity to bring new capital, dynamism and efficiencies to the water sector through private equity-driven consolidation.
  4. Spur the development of public-private and public-public partnerships to help close the water funding gap by bringing globally established best practices to the US market.
  5. Strengthen the water innovation ecosystem by establishing industry frameworks for assessing and adopting new technologies.
  6. Open up conservative utility bidding procedures and update building codes to allow for procurement of efficient, cutting-edge equipment and technologies.
  7. Encourage innovation and competition in serving water systems by providing incentives for consultant rotation, independent advice and transparent bidding processes.
  8. Expand the decoupling of regulated utility revenues from water consumption to enable investments in conservation and efficiency, especially in water-stressed regions.
  9. Consider more closely long-term capital expenditure needs and water source availability, as well as the traditional financial indicators, in the formulation of water utility bond ratings.
  10. Convene the various institutions with oversight on water to set a coherent national water agenda, one that includes efficiency goals, upon which updated regulations and implementation mechanisms would be based.

The full report is available here: 

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