Amid a deepening sovereign debt crisis that is pushing the global banking system to the edge, Europeans are more concerned about climate change than about the economic situation, according to a recent Eurobarometer survey, assigned by the European Commission.

Just over half of respondents in the European Union’s 27 member states mentioned climate change as one of the world’s most serious problems, and 20 percent felt it is the single most serious problem. In ranked order, climate change came second only to poverty, hunger, and lack of drinking water (28 percent) — which remained the priority concern for most citizens across Europe, mentioned by 64 percent in total — with the state of the economy (16 percent), international terrorism (11 percent), the availability of energy (7 percent) and others trailing behind.

How Have Opinions Changed Since 2009?
The overall pattern in the June 2011 survey is consistent with that seen in 2009, when poverty, hunger, and lack of drinking water also topped the opinion polls as the most serious global problem, again followed by climate change. Though there is considerable variation in how concerned citizens are about climate change between member states, the survey shows that these worries have increased throughout most of Europe when compared with survey results from two years ago.

The faction of EU citizens who believe there are economic benefits to fighting climate change and improving energy efficiency has also risen, from 63 percent in 2009 to 78 percent in 2011. Not surprisingly, overall attitudes toward climate change also influenced opinions on the economic benefits of action, according to the survey.

At the same time, the majority of respondents saw tackling global warming as the responsibility mainly of national governments, the EU, and businesses.

Nations Where Economy Topped Climate
There were nations where the economic situation overshadowed climate concerns, however. The state of the economy was the most urgent problem — along with poverty, hunger, and lack of drinking water — in the Czech Republic, Italy, Cyprus and Greece, among others.

Not surprising, since Greece, in particular, is facing a severe debt crisis. The 2011 deficit is projected to rise above 8.5 percent of Greece’s GDP, and the nation is desperately trying to stay afloat with the help of bail-outs by the big European economies, which are also struggling to keep other debt-laden countries from the same financial outcome. With the fate of the common European currency in question, EU leaders announced on Monday that they had given themselves a deadline of two weeks to agree on a comprehensive deal to tackle the eurozone debt crisis.

Read more details in the original report.

Image © James Workman

From left to right: Carole Baker, Texas Water Foundation; Doug Bennett, Southern Nevada Water Authority; Malcolm Morris, Millennium Water Alliance; Dr. Anthony Fellow, Cal State U. Fullerton; Hank Habicht, SAIL Capital Partners.

James Workman was among a marquee roster of water-sector grandees attending the one-day forum on water issues, emphasizing the need for greater public awareness. He recounts the meeting, which coincided with the opening session of the United Nations General Assembly in hopes that it would draw the delegates’ attention to water.

The ‘just-add-water’ recipe is hardly a secret:

• Start with international venue.
• Preheat room with wrenching video of faces dying from diarrheal dehydration.
• Pack seats with dewy-eyed students.
• Add dash of earnest and gorgeous movie star.
• Fold in scholarly jargon on abstract norms.
• Sprinkle grim statistics presented by chief of obscure global entity.
• Stir corporate sponsor’s products, posing as social agenda.
• Grate in activists’ social agenda, concealed as an innocent question.
• Whip up froth in call for action.
• Serve congratulations at reception with water-intensive sweets, breads, meats, and booze.

Did anything separate last Friday’s “International Water Forum at the United Nations” from so many other such conferences? Beyond business card accumulation, what justifies the time and expense devoted by good people to convening and attending such well-meaning gatherings?

To ask these questions, one risks the label of a ‘jaded cynic.’ Or, worse, being ostracized from future opportunities to network, benchmark, collect travel per diem, seek career advancement, and bask in the warm glow of elite inclusion. Did I mention the per diem?

ABOUT THE AUTHOR:

James Workman is author of Heart of Dryness: How the Last Bushmen Can Help Us Endure the Coming Age of Permanent Drought.

He is also a visiting professor at Wesleyan University’s College of the Environment and co-founder of SmartMarkets LLC, an online utility-based system that unlocks equitable water and energy markets for global cities using the system that has sustained the Kalahari’s indigenous people for 30,000 years.

Over the last decade, I am perhaps the most shameless beneficiary at the conference-hopping trough. I’ve absorbed several dozen events, sometimes even as speaker. I have the pens, key chains, frequent flier miles, tote bags, name tags, reusable bottles, and expanding waistline girth to prove it.

But I don’t feel jaded —not yet. Indeed, for my two cents, the UN forum was worth all the security checkpoint hassle, because, by accident or intent, it revealed a growing dichotomy and healthy tension between those who approach water issues as a “global” issue and those who regard the water crisis as, fundamentally, “local” in scope.

Both views made appearances at the UN, and they were often on the same dais. Each party knew a bit about each other’s arena and priorities. But — given just 600 seconds to offer their three-point spiel — most panelists spoke past one another, agreeing only “to take the first step toward organizing a worldwide education and awareness campaign on the global water crisis.”

In short: Let’s ensure that 6.96 billion people appreciate the value of fresh water as much as we do.

Two Approaches: For Compassion, Or For Money?
Such modest ambitions aside, how do we measure, interpret, and express water’s value?

By and large, water globalists answered by appealing to our heart strings. They argued that, to improve the lives of billions of thirsty and hungry and sick people, we should rise up and meet growing demand with political will; pump and divert more water; allocate tens of billions of additional public dollars; spend more of our finite money, time, policy, and effort on supply.

In comparison, water localists appealed to our purse strings. They emphasized how spending more won’t, by itself, solve our problem. In fact, they said, we can often best meet finite supply by using less — pump and divert less water; burn through less money; transfer cheap technology; economize the Global Recession’s limited funds by focusing energy on human demand.

Image © James Workman

“Saving water costs less than creating new supplies, and builds resilience for the extremely volatile months and years to come.” – Mary Ann Dickenson, President of the Alliance for Water Efficiency, shown here on a panel with Ben Grumbles, President of the Clean Water America Alliance.

Do these supply vs. demand agendas compete? Is one suitable for India, the other for Florida? Are they two sides of the same coin? Or are they forever mutually exclusive?

Making The Connection
Alas, there was no discussion within or between panels. Few acknowledged or bridged the yawning supply-demand chasm. Interestingly, the few who did make attempts tended to be lawyers, economists, literature majors, investors…and women.

For instance, Mary Ann Dickinson, head of the ‘local’ Alliance for Water Efficiency (AWE), cited a case in Tennessee, where cheap, fast collaboration quadrupled three hours per day of urban water access into 12; and with no new supply. But, while AWE is based in Chicago, Sacramento, and Washington, D.C., its ‘local’ solutions appeal widely, now reaching into China, Jordan, and the Philippines, along with other developing countries whose metastasizing cities seek new tools to reduce unnecessary water use between 5 and 50 percent.

Her point was that conservation transcends borders.

“As demand for water rises and climate changes, water efficiency is a solution that works,” Dickinson said. “Saving water costs less than creating new supplies and, in the process, builds resilience for the extremely volatile months and years to come.”

As head of the localist Association of Water Resource Agencies, (AWRA) Michael Campana, squeezed sponges to demonstrate groundwater’s hidden value. But, as a globalist, he called on the U.S. to recognize the human right to water, and sought a new online game as a tool to secure understanding of water in the borderless virtual world.

Meanwhile, globalist John Oldfield, of WASH Advocacy Institute, has lobbied in D.C. for more policy solutions, more public funding, and more political will. But he sounded localist when he pointed out that water offered each investor a whopping $US 8 return for every $US 1 invested in specific places. The value proposition was so cost efficient because, he said, “water is medicine. Toilets are medicine.”

The most extreme in the dichotomy was luncheon speaker Charles Fishman, author of The Big Thirst, who asserted unequivocally: “There is no global water crisis. All water problems are local.”

That blanket statement might have interested Pat Mulroy, the general manager of the Southern Nevada Water Authority (SNWA), who called on everyone to think of Las Vegas’ local water not as “theirs” or “mine,” but rather as “ours.” By “ours,” she linked suburban tap to city plant; to regional agency; to Colorado River; to 30 million people who share its flow;, to tens of millions more who depend on its hydroelectric generation; to the billions of others who eat food that is grown in the basin.

In wrapping up, AWE’s chair, Carole Baker, and SNWA’s conservation director, Doug Bennett, each highlighted local campaigns at education and water efficiency to “climate proof” Texas and Las Vegas. Both localists are doing remarkable work by building resilience and awareness from below — but is it enough?

Perhaps what Baker and Bennett did not mention paints the clearest picture: Texas’ “Fed Up!” governor, Rick Perry, recently resorted to begging federal taxpayers to spend on relief for his state’s crippling drought and fires, while Las Vegas is seeking federal subsidies to tap federal aquifers and to divert rivers that reach across international borders. Homegrown solutions may thus depend on transcontinental sympathy.

John Donne wrote, “No man is an island.” But perhaps it isn’t land that links our spirits and our fates. Rather, the connective tissue is fresh water. For — through its flows, food, energy, and trade — water inextricably binds my local wants with the global needs of utter strangers. So, if you and I reduce our thirst and hunger here, we will leave more water for human and natural communities, however distant, somewhere else.

The upshot? Well, not that I’ll be invited after this open reflection, but perhaps the next conference could take up the task of defining the local vs. global tension by encouraging robust debate in a remote location, where we provide our own tent, food, water, and sanitation…and contribute our per diem to a water organization of our choice – one that is out there practicing what so many of us can only preach.

James Workman
Read excerpts from Workman’s book on Circle of Blue.

While landowners took to Australia’s streets in mid-August to demand greater protection against the potentially lucrative coal seam gas industry, opposition groups in South Africa were mustering strength against shale gas exploration that, they say, could threaten the nationally significant Karoo region.

Australia and South Africa are among an increasing number of countries around the world that are reckoning with the prospects of developing unconventional fuels to bring revenue, to diversify energy sources, and to reduce carbon emissions.

But the rapid expansion of the unconventional fuels industry, along with the large volumes of water needed to unlock gas from underground coal beds and shale rock formations, have raised concerns over the potential damage to underground water aquifers, human health, food production, and the environment. These industries are also creating competition over land and water rights, which could spill over into political and social disputes.

Dewatering Australia: Coal Seam Gas v. Agriculture
In recent weeks, Australian farmers have locked gates on properties and organized protests against coal seam gas and coal mining companies trying to tap underground resources in prime agricultural lands.

The protesters, many of them farmers, worry that coal seam gas — also known as coalbed methane (CBM) extraction, which withdraws pre-existing water from the coal seam, thus reducing the pressure and allowing the methane gas to separate from the solid coal and to flow to the surface — might pollute the water resources for drinking and farming. They are demanding a moratorium on CSG drilling, until the health and environmental impacts of the process can be assessed further. The CSG “dewatering” process typically takes two years.

Around 2,000 yellow signs bearing “Lock the Gate” slogans were hung on farm gates throughout Queensland and New South Wales in mid-August, encouraging land owners to stand up to the energy companies, Sky News reported.

Protesters also gathered at a recent mining conference in Sydney on August 18, according to ABC News.

The recent events follow months of wrangling between farmers and miners over energy production, traditionally a very influential sector in Australia. The tensions also sparked political controversy earlier this month, when the Greens Party called for new laws to give stronger rights to farmers, enabling them to keep coal seam exploration rigs off their land, Reuters reported.

According to Australian legislation, the rights to below-ground deposits belong to the government, instead of to individual landowners, meaning that citizens have a hard time keeping energy companies off their property.

Meanwhile, Australia’s CSG industry — a major source for the country’s growing liquefied natural gas (LNG) sector – plans to build roughly $US 70 billion worth of LNG projects in Queensland state over the next seven years; a scenario that is also estimated to create thousands of new jobs each year. Exploration is also advancing in neighboring New South Wales, according to Reuters.

Fracking South Africa’s Karoo Region: Shale Gas Exploration in the Desert
Similarly, South Africa has been gauging the extensive risks associated with the potentially big economic benefits of proposed shale gas drilling in its Karoo region, a semi-desert area known for its stark beauty and indigenous plants; a region that is also believed to hold substantial deposits of shale gas.

Earlier in August, Yale Environment 360 reported that opposition to natural gas drilling is growing among farmers, landowners, and environmentalists in the country, amid concerns that hydraulic fracturing, or fracking – the process of injecting water, chemicals, and sand at high pressure into rock formations to free up the oil and natural gas trapped inside – will deplete and pollute the Karoo’s scarce water supplies.

The worry is that the poverty-stricken region will become the arid twin of the Niger Delta’s swampy mangroves, where foreign oil companies and long years of conflict have contaminated the Nigerian land and water.

In July, protesters chanted outside the Shale Gas South Africa Conference in Johannesburg, where Shell South Africa – just one in a score of companies eyeing shale gas in Karoo — was to discuss its fracking plans for the region.

Earlier this year, in February, South African farmers and environmentalists voiced a public concern over plans to look for shale gas. Then, in May, the South African government said it would conduct a comprehensive feasibility study of hydraulic fracturing before it decides on the shale gas applications in its Karoo region, and the government imposed a moratorium on the use of the fracking technique until that time. This announcement came on the heels of a number of policy decisions in China, Europe, and the United States that have set diverse agendas for shale gas drilling around the world.

Source: Australia Broadcasting Corporation News, Sky News, Toowoomba Chronicle, Yale Environment 360, Reuters

On August 15, Houston’s mayor announced restrictions on its outdoor water use, and the city joined 795 other Texas water systems that are cutting down on water consumption in response to a persistent 10-month drought in the state.

The conservation mandate is the latest in a series of drought policies in Texas that have instituted water restrictions instead of price mechanisms, and raised questions over the most effective ways to manage water shortages.

Roughly 11 percent of the Texas water systems have mandatory restrictions in effect, and another 6 percent have voluntary constraints, amid the state’s driest spell in recorded history, according to the Texas Commission on Environmental Quality.

In Houston, residents must follow a two-day-a-week lawn-watering schedule, mornings and nights only, in accordance with the city’s Stage Two conservation plan.

Meanwhile, Midland, whose supply reservoir is only a quarter full, has seen a 20 percent cut in its allocation from the Colorado River Municipal Water District. As a result, the city in western Texas, which has received less than an inch of rain since October, has limited lawn watering and car washing to twice a week, and prohibited the use of ornamental fountains (unless the fish would die).

The measure is only the second stage of a five-stage water conservation plan, which might see Midland cut off all landscape irrigation, car washing and pool filling, and discontinue connecting new users to the system if rains do not return by next year.

Tell Us What To Do
When it comes to supply shortages, water departments usually respond with restrictions. Except in the most extreme circumstances, utilities and their customers prefer the dictates of government to the hand of the market, according to Sheila Olmstead, an economist and a fellow at Resources for the Future, a Washington, D.C.-based center for environmental policy.

“There’s a precedent for market-based approaches in public policy, especially for pollution control,” Olmstead told Circle of Blue. “But we haven’t gotten to that point with natural resources where pricing is a commonly used tool.”

In Texas, for example, San Antonio and Dallas have price increases written into their drought response plans, but neither city has ever had to levy them.

Yet, according to Olmstead, a market-based policy—raising the price of consuming water—would be much less costly than government mandates and would achieve the same net result.

In strictly economic terms, it is more expensive for water departments to monitor, enforce and maintain restrictions than to use the water metering system already in place. With restrictions, Olmstead said, water sales—the primary revenue source—drop off just as repairs are needed for water main breaks. Often, utilities would have to raise rates coming out of a drought to make up for the revenue lost to conservation.

Price increases, on the other hand, allow a utility to retain that revenue while still reducing water use by the same amount. If they exceed a regulated maximum, revenues can be returned in a rebate to the city’s poorest residents, who would be most affected by higher prices.

Customers also lose from the restriction regime, Olmstead added. Restrictive measures would in effect prohibit those who are willing to pay more for their outdoor water use from spending on their preferences. According to a Resources for the Future policy commentary by Olmstead and Erin Mansur, an economist at Dartmouth College, large cities are losing millions of dollars per summer because of water restrictions.

Case in Point
The touchstone case for drought pricing happened two decades ago in Santa Barbara, Calif., when the city was transitioning to block pricing to better match supply with demand.

Block pricing divides water use into consumption chunks, with the price per unit of water increasing as the use grows.

When projections in the first months of 1990 showed a water supply deficit of 45 percent for the year and 80 percent for subsequent years if dry conditions persisted, the Santa Barbara water department made the consumption blocks smaller and significantly raised rates. Bills for low-volume users were largely unaffected, while the price in the highest block increased nearly ten-fold, all in an attempt to rein in demand while keeping basic needs affordable.

Santa Barbara also adopted mandatory restrictions on lawns, pools and fountains. According to the water department’s post-drought assessment, the city wanted to spread the burden across all customers, not just the ones who couldn’t afford the higher prices.

Olmstead said this is one reason why utilities prefer mandatory restrictions: they create perception of social solidarity, since all users suffer scorched turf.

Statements from public officials suggest the same. In the 2007 drought in the Southeast, Georgia’s governor called on the state’s citizens to “make their dry lawns and dirty cars a badge of honor.” By doing so, they could “collectively help to ensure that our water supply is sufficient.”

The South Carolina Water Plan also vows to manage water shortages in a way “that all users would share the burden.”

Perhaps this is a case in point for Midland, where tensions are starting to rise between those who are on city water and are subjected to mandatory restrictions, and those with private wells, which are not regulated.

“Neighbors are getting mad at their neighbors and so it’s less the city getting engaged, it’s creating tension in the neighborhoods,” Midland City Councilman John James told KOSA, the CBS affiliate in West Texas.

Sources: Resources for the Future, Texas Commission on Environmental Quality, City of Houston, City of Santa Barbara post-drought assessment, City of Midland, KOSA, South Carolina Water Plan

The United Nations is struggling to keep up with the surge of hungry Somali refugees fleeing to Ethiopia and Kenya as a result of relentless drought and conflict in eastern Africa, the U.N. High Commissioner of Refugees (UNHCR) said.

Last week, several aid agencies increased warnings over a worsening humanitarian crisis in Somalia, Ethiopia, Kenya, and Djibouti amid an unprecedented dry spell, chronic instability, and high food prices in the Horn of Africa.

On Sunday, the first of several UNHCR-charted cargo jets with emergency aid arrived in Kenya’s capital, Nairobi, as part of the agency’s refugee efforts in Kenya and Ethiopia. UNHCR is among a number of aid organizations that have reported shortfalls in funding for their emergency programs in the Horn of Africa.

There are more than 430,000 Somali refugees in Kenya and Ethiopia alone, including 164,000 who have arrived since the beginning of the year, according to the U.N. Some 3,000 refugees from Somalia – now on the verge of famine — continue to arrive in Kenya daily.

Officials report that some of the refugees show signs of severe malnutrition, exhaustion, and dehydration, with some even dying during or shortly after the journey.

And the problem is exacerbated by the continuing civil strife in most of Somalia, as well as cross-border violence between pastoral communities in Ethiopia and Kenya, which is decreasing supplies, causing civilian casualties, and triggering massive displacement.

The U.N.’s Office for the Coordination of Humanitarian Affairs (OCHA) called the dry spell — resulting from two consecutive poor rainy seasons — the worst drought the region has experienced in 50 years. The United Nations’ humanitarian news agency, IRIN, recently said that the devastating drought is likely the result of strong seasonal weather phenomenon in the region and is not tied to climate change.

Eastern Africa is also feeling the pressure of high food and fuel prices.

Last week, people in Nairobi protested against Kenya’s soaring inflation — at 14.5 percent in June – largely due to regional grain shortages, rising consumer demand, and weakening of the local currency.

Throughout the Horn of Africa, food prices are rising as a result of bad harvests and poor prospects for the upcoming crops. Grain export bans by Tanzania and Ethiopia to control domestic prices have placed additional pressure on prices in neighboring countries, according to the Famine Early Warning Systems Network (FEWS NET), which monitors trends in staple food prices in countries that are vulnerable to food insecurity.

The price of maize on the wholesale market in Kenya has increased 160 percent since July 2010, following the failure of this year’s maize crops, and the retail price of red sorghum has risen 169 percent, the Financial Times reported. In southern Somalia, sorghum prices have jumped by 240 percent over last year’s prices.

Source: FEWS NET, IRIN, The New York Times, Reuters, UPI, United Nations, UN High Commissioner of Refugees

By Keith Schneider
Circle of Blue

The coal mines of Inner Mongolia, China and the oil and gas fields of the northern Great Plains in the United States are separated by 11,200 kilometers (7,000 miles) of ocean and 5,600 kilometers (3,500 miles) of land.

But, in form and function, the two fossil fuel development zones—the newest and largest in both nations—are illustrations of the escalating clash between energy demand and freshwater supplies that confront the stability of the world’s two biggest economies. How each nation responds will profoundly influence energy prices, food production, and economic security not only in their domestic markets, but also across the globe.

Both energy zones require enormous quantities of water—to mine, process, and use coal; to drill, fracture, and release oil and natural gas from deep layers of shale. Both zones also occur in some of the driest regions in China and the U.S. And both zones reflect national priorities on fossil fuel production that are causing prodigious damage to the environment and putting enormous upward pressure on energy prices and inflation in China and the United States, say economists and scholars.

“To what degree is China taking into account the rising cost of energy as a factor in rising overall prices in their economy?” David Fridley said in an interview with Circle of Blue. Fridley is a staff scientist in the China Energy Group at Lawrence Berkeley National Laboratory in California. “What level of aggregate energy cost increases can China sustain before they tip over?”

“That’s where China’s next decade is heading—accommodating rising energy costs,” he added. “We’re already there in the United States. In 13 months, we’ll be fully in recession in this country; 9 percent of our GDP is energy costs. That’s higher than it’s been. When energy costs reach eight to nine percent of GDP, as they have in 2011, the economy is pushed into recession within a year.”

Economies of Scale
China is growing and modernizing at a pace and scale never before seen in history, while the U.S. is mired in an economic downturn, caused largely by rising energy prices.

Indeed, given the different economic circumstances that grip both countries—one soaring and the other in a serious slump—they nevertheless view energy production as the top national priority. Growth and development at such a scale demand innumerable resources, particularly water. As a result, the water needs of Chinese and American energy producers take precedence over any other economic sector.

“The United States confronts the same kind of resource conflicts as China,” Fridley said. “There are increasing expectations of confrontation over water as a factor in energy production.”

Photo © Heather Rousseau / Circle of Blue

The U.S. is tapping new reserves of fossil fuel, that are more difficult to develop and use much more water, to sustain its economy. Natural gas wells, like this one in Michigan, are nearly two miles deep and use upwards of 5 million gallons of water to hydrofracture sedimentary rock to release the gas.

Coal production in Inner Mongolia and shale oil drilling in the northern Great Plains reflect this homage to carbon-based fuels. The development of carbon resources in both regions uses more water than any other industrial sector except agriculture. It also is pouring into the atmosphere millions of metric tons of the climate-changing gases that climatologists say are warming the planet, changing patterns of precipitation, and increasing the intensity of droughts and storms.

The extremes in weather, in turn, make it even more difficult to generate carbon-based energy as severe droughts affect mining and drilling operations.

Yet, by insisting on developing new sources of carbon-based fuels that are drawn essentially from the desert both nations are testing the limits of their national water reserves and challenging the capacity of other important economic sectors—agriculture, large metropolitan regions, major manufacturers—to use much less water.

“China’s continued growth and stability hinge on finding a more sustainable strategy to cope with its water and energy demand,” Parag Khanna told Circle of Blue. Khanna is an author, global strategist, and senior research fellow at the Washington, D.C.-based New America Foundation. “The external risk of friction with its southern neighbors over water diversions and internal tensions due to falling water supply and environmental pollution are both growing.”

Photo © J. Ganter / Circle of Blue

Energy production sucks up increasing amounts of water in China and the U.S., testing the capacity of agriculture and other industrial sectors to use much less. In Ningxia Province, one of China’s largest coal producers, supplies of water to farmers have been cut 30 percent since 2008.

Droughts Affecting Fossil Fuel Development
Despite national agendas that are focused on domestic energy security, there are a score of environmental, economic, and political impediments that lie in the path to large increases in Chinese and American energy production.

Few, though, are more significant than the steadily diminishing reserves of fresh water in both countries. China lost 35 billion cubic meters (9.3 million gallons) of water every year over the past decade, according to figures from the National Bureau of Statistics. The U.S. also lost water, a total of 19 billion cubic meters (5.02 trillion gallons) in the period from 1985 to 2005.

In the last year, energy-water choke points have become more urgent and visible in both countries.

From January to June, a severe drought in southern China not only reduced hydroelectrical generation in the Yangtze River Basin, but low water levels also curtailed coal shipments to manufacturers and power plants down river. Similarly, northern China endured its driest winter in the past 60 years, which put pressure on already limited water resources used by coal producers. This led to further coal supply reductions, higher coal prices, and contributed to inflation.

Though coal prices are soaring, China’s energy producers can’t raise consumer prices because of tight state control over electricity fees. Instead, they are cutting power output to save money.

In May, China’s top five power utilities—which generate half of the country’s electricity—reported $US 1.62 billion (RMB 10.5 billion) worth of losses in their coal-fired power plants during the first four months of the year, according to the Xinhua News Agency. China’s main electricity distribution company, the State Grid, warned that power shortages this year could reach 30 to 40 gigawatts, even if coal and water supplies are normal for the rest of the season.

Texas has faced similar drought conditions. The period from October to May has been the driest since the state began keeping records in 1895, according to Texas A&M University.

The Texas drought is prompting shale oil and gas producers to seek tens of millions of gallons of water from farmers. The water is needed for hydraulic fracturing—the process of injecting water, chemicals, and sand at high pressure into sedimentary rock formations to free up the oil and natural gas trapped inside.

As the price of water is climbing, farmers and ranchers are deciding how much they are willing to sell.

In 2009, there were 358 natural gas drilling rigs in Texas alone, and that number had increased to 709 rigs by 2010, according to the Natural Gas Supply Association. Each rig can drill multiple wells in a year and each well typically uses upwards of 19,000 cubic meters (5 million gallons) of water for “fracking.” In southern Texas’ Eagle Ford Shale, however, fracking one well can use as many as 49,000 cubic meters (13 million gallons), due to the region’s unusual geology.

Additionally, because of the severe drought in Texas, water supplies have become a big issue for opponents of a coal-fired power plant proposed for Matagorda County. On June 16, the Lower Colorado River Authority (LCRA) delayed a vote to decide whether to sell more than 30 million cubic meters (8 billion gallons) of water per year to the owners of the planned White Stallion generating station.

“This delay is a victory for those opposing the coal plant and a step in the right direction in convincing the LCRA that this project is not a beneficial or responsible use of water from the Colorado River Basin,” Ryan Rittenhouse wrote in an article for TexasVox, an online publication of Public Citizen in Texas.

Droughts Affecting Hydropower Generation—Three Gorges and Hoover Dams
In both China and the United States, hydropower is a significant source of energy that does not rely on carbon-based fuels. But this spring’s drought in central and eastern China has crippled hydroelectric power generation throughout the Yangtze River Basin, creating a power deficit, the effects reverberated across the country.

In late May, the operators of China’s Three Gorges Dam began releasing torrents of water to revive the drought-depleted Yangtze River and to protect water supplies for downstream farms, fisheries, people, and livestock. Since January, more than 19 billion cubic meters (5 trillion gallons) of water have been released from the world’s biggest dam to China’s largest river, with 5 billion cubic meters (1.3 trillion gallons) flowing just in the last few weeks.

Photo © J. Carl Ganter / Circle of Blue

Xilinhot—an Inner Mongolian outpost of 177,000 residents, separated from Beijing by a 12-hour train ride—sits atop a huge coal reserve, which has helped to turn Inner Mongolia into the number one coal producer in China and the largest coal-producing region in the world.

The emergency action had a cascading effect on the country’s energy supply. At the peak of the drought, water levels at the reservoir had dropped four meters (13 feet) below the minimum level needed to operate its turbines efficiently. Hydroelectrical output fell during the time of year when output should be at its highest: spring melt. According to official figures, nearly 1,400 dams in Hubei Province—home of the Three Gorges—do not have enough water to generate any electricity at all, Reuters reported.

To compensate, China has increased electricity prices and cut diesel exports by half, making the fuel available for domestic power generation. As a result, analysts speaking with Bloomberg News predicted rising demand for coal. Still, the seven-month drought has China bracing for its worst summer of power outages since 2004.

Though they did not endure power cuts, water and power customers in the American Southwest can certainly commiserate. Just eight months ago, water levels in Lake Mead—the reservoir behind the Hoover Dam—dropped to record lows and came within two meters (six feet) of triggering a first-ever shortage declaration on the Colorado River.

The Colorado River Basin supports more than 30 million people and irrigates a $US 3 billion agricultural industry. Dams in the basin, including the Hoover Dam, are a key source of base-load power for much of the Southwest.

Electrical generation at the Hoover Dam fell steadily during the decade-long drought, with its output in 2009 registering 30 percent lower than in 1999. Like their Chinese counterparts, utilities in the Southwest turned to fossil fuels to make up the shortfall. If climate change, as it is widely assumed, causes river flows to decline even further, lower-than-capacity electrical generation could be the new standard in both countries.

Regional Droughts—What Do They Mean?
The regional droughts are a warning of the much bigger energy production and economic challenge facing both nations, according to Fridley.

“People say to me, ‘Oh, you’re so negative.’ I say, ‘Let’s face up to what we’re up against,’” Fridley said. “It’s energy. It’s food. It’s water.”

By The Numbers: U.S.

U.S. water supply is fairly consistent: In 2005, total renewable freshwater reserves were 3.05 trillion cubic meters (806 trillion gallons)—19 billion cubic meters (5.02 trillion gallons) less than in 1985, meaning that the U.S. is losing about 1 billion cubic meters (264 billion gallons) of water annually

62 percent of total energy production comes from oil and natural gas: Annual crude oil production will climb to 303 metric tons (2.2 billion barrels) by the end of the decade, up from 274 metric tons (2 billion barrels) in 2010. Similarly, annual natural gas production will increase from 611 billion cubic meters (21.6 trillion cubic feet) to 663 billion cubic meters (23.4 trillion cubic feet).

Freshwater withdrawals on the rise: In 2005, annual freshwater withdrawals were 481.8 billion cubic meters (127.3 trillion gallons). In 2030, annual freshwater withdrawals are predicted to climb to 507.6 billion cubic meters (134.1 trillion gallons).

Adequate water supplies are more essential than ever for producing energy from reserves of coal, oil, and natural gas that are increasingly difficult to tap, process, and move to market. Both nations are trying to stave off energy shortages that would drive prices to such a high level that their economies could tilt to sharp and enduring declines.

“I don’t see how you can look in-depth at these issues of water use and not understand—we do not make water,” Fridley said. “We have a problem that, to me, is going to force us to be much more mature about how we live and what we need to change.”

Solutions: China Ahead of U.S.
Though both nations are investing in water-sipping and much cleaner renewable energy sources—particularly solar and wind production—make no mistake about their primary economic objectives. China and the United States are pursuing development strategies largely devoted, at least for the next two decades, to perpetuating the fossil fuel economies of the 20th century.

In both countries, freshwater reserves are in erratic supply in important energy-producing regions—northern China’s coalfields and southern China’s hydropower region; the oil shale region of the northern Great Plains and the coal fields of the Rocky Mountain West.

While China and the U.S. share many of the broad trends in energy production and water supply, there are big differences when it comes to anticipating and developing rational responses to the tightening choke points between these two critical resources.

China’s business, provincial, and central government leadership have developed a long-term growth plan, and a number of the conservation steps that have been enforced have actually worked:

• Since 1995, China’s economy grew eight-fold, but its water consumption increased about 1 percent a year, or just less than 16 percent over 15 years.
• China’s big northern cities, led by Beijing, are developing innovative water recycling programs to convert wastewater to gray water, which can be used for flushing toilets, washing cars, and landscaping.
• Big industrial plants are required to recycle nearly all of the water they use in manufacturing steel, cement, glass, vehicles, and other products.

And China is not afraid of acting quickly to avoid making its water shortages worse. For instance, as recently as 2008, China had planned to build a total of 23 large coal-to-liquids refineries, where, instead of being burned for power generation, coal is pulverized to dust, mixed with water, and heated to produce diesel fuel. At first, the pay-off seemed well worth it—roughly $US 50 a barrel to produce in the current $US 112-per-barrel global oil market—until the water investment was assessed.

When Chinese authorities learned that an operational refinery—owned by Shenhua Group, China’s largest coal producer—annually used 10 million cubic meters (2.6 billion gallons) of water to convert 4.1 million metric tons (4.5 million short tons) of coal into 1.1 million metric tons (1.2 million short tons) of diesel, the government curtailed the program.

Photo © Aaron Jaffe / Circle of Blue

Agricultural field in the water-stressed Yellow River Basin

Just three other coal-to-liquids plants, already under construction and much smaller than the Shenhua plant, were allowed to proceed to completion.

In contrast, there has been a surprising lack of urgency among U.S. state and federal leaders despite clear evidence of rising energy demand and diminishing freshwater. Within the last year, however, administrative changes have been proposed to prod the government to do more to understand the trend:

• The U.S. Department of Energy has deliberately prevented public disclosure of an important 2009 study—commissioned by Congress in 2005—to develop a scientific roadmap to outline the areas of research that should be pursued to resolve energy-water choke points.
• In June, the U.S. Senate began considering the Energy and Water Integration Act, legislation that would mandate more studies on water and energy efficiency, conservation, current water use for energy production—both in transport fuels and electricity generation—and technological evaluations. Under the Senate proposal, some of the research production would be shifted to the National Academy of Sciences, but the Department of Energy would retain responsibility for the roadmap report.

Perpetual Fossil Fuels and Chronic Water Shortages
By no means, though, does China have all the answers. While China is doing a better job than the United States in anticipating and responding to new trends, neither country is close to resolving the confrontation between rising energy demand and unstable freshwater reserves.

Unless China either gets much wetter or pushes harder to conserve water or more speedily develops bigger wind, solar, and seawater-cooled nuclear sectors—which do not use much fresh water—the country faces a crippling energy shortage by the end of the decade.

Because of its prominence as the world’s largest market for food, energy, steel, cement, cars, trains, and other goods, how China resolves the confrontation between rising energy demand and scarce water supplies will affect not only the economy of the United States, but also those of almost every other industrialized nation.

“China recognizes the sheer magnitude of extracting as much coal as it is now in a single year,” concluded David Fridley of Lawrence Berkeley National Laboratory. “They have talked about capping coal production at 3.6 billion metric tons annually in the new Five-Year Plan. It’s not at all clear from their available water supply, transportation limits, and production costs that they can sustain coal production at 4 billion metric tons per year for even a couple of years.

“All of these limits feed into price increases that can change behavior before China runs into an absolute energy shortage,” Fridley added. “That’s what we don’t know—will price impacts be enough to change behavior? Or will there be absolute energy shortages?”

This post has been revised to reflect the following update:

Update: August 15, 2011
An earlier version of this article, based on coal sector industry data, reported that China’s coal industries used 138 billion cubic meters of water in 2010. Newer data by government agencies put water use by the coal sector at 120 billion cubic meters annually.

Keith Schneider—who has reported on energy, water, and climate change from four continents—is a Traverse City-based senior editor for Circle of Blue. Reach him at keith@circleofblue.org.

Contributions by Aubrey Ann Parker, Brett Walton, Nadya Ivanova, and Travis Miller—reporters for Circle of Blue. Also from Jennifer Turner, Washington, D.C.-based director of the China Environment Forum at the Woodrow Wilson International Center for Scholars.

]]> http://www.circleofblue.org/waternews/2011/world/choke-point-china-us-comparison/feed/ 1 http://www.circleofblue.org/waternews/2011/world/the-price-of-water-2011-prices-rise-an-average-of-9-percent-in-major-u-s-cities/ http://www.circleofblue.org/waternews/2011/world/the-price-of-water-2011-prices-rise-an-average-of-9-percent-in-major-u-s-cities/#comments Thu, 05 May 2011 17:37:02 +0000 Brett Walton http://www.circleofblue.org/waternews/?p=28753 Because of costlier inputs and infrastructure replacement, rate experts predict prices will only go higher.

By Brett Walton
Circle of Blue

In the last year, the price of water in 30 U.S. metropolitan areas has increased an average of 9.4 percent for residential customers with medium consumption levels, according to data collected by Circle of Blue. The median increase for medium consumption was 8.6 percent. Water rates for high-volume consumers have increased slightly more than rates for lower consumption—an indication that utilities may be attempting to curb water use by charging higher marginal rates.

Full Survey Graphics

View data: JPG image, Adobe PDF

The annual survey, which Circle of Blue first conducted in April 2010, charts what residents pay per month for water in the 20 largest U.S. cities, as well as 10 regionally representative cities.*

Monthly water bills were calculated for a family of four at three consumption levels:

• Low: 50 gallons per person per day (6,000 total gallons per month)
• Medium: 100 gallons per person per day (12,000 total gallons per month)
• High: 150 gallons per person per day (18,000 total gallons per month)

Since the prices depend on cost-of-service factors and revenue decisions unique to each utility, comparisons between cities are somewhat difficult at first glance. However, the broader trend is unmistakable: the price of water is going up.

Over the last year, the largest relative rate increases occurred in Indianapolis (29.3 percent increase at medium consumption), Milwaukee (25.4 percent), and Houston (24.3 percent).

Water prices in two cities—Fresno and Chicago—have not changed since last April. Both cities, however, have already seen their fair share of rate hikes in recent years. From 2007 to 2010, the cost of water doubled in Fresno, while prices increased by half in Chicago.

Where the Money Goes: System Improvements

Starting in Yosemite National Park’s Hetch Hetchy Valley, San Francisco’s century-old water supply system crosses over or near three fault lines in its 269-kilometer (167-mile) path to the Bay Area, where it provides water for 2.5 million people.

To protect this vital infrastructure from earthquakes, San Francisco voters approved a $4.6 billion bond measure in 2002 for seismic upgrades and reliability improvements. Scheduled to be completed in 2015, more than 80 projects will overhaul nearly every system component: pipelines, dams, pumping stations, reservoirs, tunnels, and storage tanks.

At the same time, the city’s water rates have increased to fund the projects. Since April 2010, prices have risen 18 percent.

Residents should get used to water rate increases, says rate consultant Scott Rubin, who doesn’t see an end to rising prices. Rubin has more than 20 years of experience working with water rate design and has written studies for the National Regulatory Research Institute.

“Every trend I look at tells me that it’s likely water costs will increase more than the rate of inflation,” Rubin told Circle of Blue.

Reasons for Increase
Prices are increasing because operational inputs such as chemicals, energy, labor, and water itself are getting more expensive. That is the case in Phoenix, where over the last decade chemical costs per million gallons of treated water have increased by 493 percent, electricity costs by 68 percent, and raw-water costs by 41 percent.

The size of the increase in each of these input categories depends on local factors, such as source-water quality and electricity prices. If water quality is poor, more treatment (and thus more chemicals and energy) will be necessary; if a utility has to pump water from greater depths as aquifers decline or to greater heights, as is the case in the 915-meter (3,000-foot) lift for the Central Arizona Project, energy costs will be greater.

Cities that buy water from regional wholesale suppliers are also paying a premium. San Diego, which imports 90 percent of its water, is one example. The city is paying 66 percent more for untreated water than it did in 2006, largely because prolonged drought has reduced deliveries of cheap water from the Colorado River. This means that cities are leasing water from farmers at greater expense.

Where the Money Goes: Metering

You can’t manage what you don’t measure, goes the business maxim. But, just as vital for the balance sheet, you can’t properly charge for what you don’t measure, either. So, many cities are installing water meters with so-called “smart” technology to better monitor use.

To be certain, water meters are not a shiny, new thing. They are commonplace in most cities and have been for some time: Portland—Oregon’s largest city—has had full coverage since 1927. Yet, penetration has been slower in older cities and in places with abundant water. In Chicago, some 71 percent of residential customers pay for water based on the width of their building or the size of their lot, not on how much they actually use.

As demand management and cost-efficiency become more essential, cities both large and small are beginning capital programs to add meters where there are none or to replace older, dated technology. The hope is that smart meters will reduce the cost of metering and billing, improve billing accuracy, provide quicker leak detection, and help customers reduce water use. The new meters can transmit data several times a day—hourly updates that reveal a much finer grain than the monthly manual meter readings.

A 2010 study by Oracle, an information technology company, found that one-third of the 300 U.S. water utility managers surveyed were considering or already implementing smart metering technology. Phoenix, Cleveland, Houston, Durham, and Ann Arbor are just a few of hundreds of cities that have initiated smart meter programs in the last few years.

Perhaps the largest municipality to adopt Metering 2.0 is New York City, where the Department of Environmental Protection is more than halfway toward a goal of installing radio transmitters on all 835,000 metered connections in its service area. Whereas most smart meters feed data to a computer in a car driven down the street, New York City’s system will transmit wirelessly to the utility’s headquarters via rooftop receivers. The $252 million program will be completed this year and is being paid for with water rate increases.

For Fresno, not only is the technology new, but the meter locations are too. Last year the Fresno water department began an $80 million program to install 110,000 meters—many in houses that never before had one. The city is following an order from the U.S. Bureau of Reclamation to meter all connections by 2013. If it does not comply, Fresno will lose rights to water deliveries from the federally administered Central Valley Project.

Other California cities are installing meters in accordance with a 2005 state law, AB 2572, requiring full-metering by 2025. The law ensures that, while the Golden State may be nearly broke, it will no longer want for municipal water data.

Additionally, Circle of Blue reported in October on potential pollution-control regulations for coal-fired power plants that could, within the next few years, raise energy prices and water prices in Arizona, Nevada, and southern California. More stringent water quality regulations—such as tighter controls on arsenic in drinking water—also come with added costs. The arsenic rule, which the Environmental Protection Agency finalized in 2006, forced many utilities to double rates, according to Greenwire.

In addition to higher operating costs, decrepit infrastructure is forcing cities to invest in costly capital-replacement projects. In older cities, Rubin told Circle of Blue, many pipes were laid more than 100 years ago and are reaching the end of their designed life. Furthermore, system expansions that took place during the 1940s and 1950s often used inferior materials because the majority of supplies had been used in fighting World War II.

The result is that, due to corrosion, piped systems are not lasting as long as they were expected to, and many need to be replaced. The cost of not doing so could be frequent water main breaks and flooded homes, streets, and businesses, especially in cities where cold winters are an added stressor. Some cities—like Baltimore, which has had 5,762 water main breaks in the past five years—are already suffering this fate.

The scale of America’s hidden, underground web keeps maintenance workers busy. Houston’s water supply network includes 12,000 kilometers (7,500 miles) of pipes, and the city replaces up to two percent (240 kilomters, 150 miles) of its water lines per year, said public information officer Alvin Wright.

Despite Cuts, No End In Sight?
To keep rate increases minimal, deflect public ire, and meet the standards set by regulatory boards, utilities have been streamlining daily operations, merging departments, and cutting staff.

Phoenix, for instance, cut the operating budget for its water services department by $10 million. The city did so by furloughing employees and eliminating a quarter of management positions. Milwaukee Water Works cut its full-time staff by 17 percent between 2000 and 2009, and the city has stopped replacing non-critical staff members who retire.

Yet, even trimming bureaucratic fat can’t overcome rising input costs and the long-term pressures of maintaining a system that is reliant on so much hardware.

“Efficiency will help systems avoid some variable costs of production in the short run and capacity costs in the long run,” Jan Beecher, director of Michigan State University’s Institute of Public Utilities, wrote in an email to Circle of Blue. “But people will need to get used to higher rates for water that reflect the true cost of service.”

Brett Walton is a Seattle-based reporter for Circle of Blue. Reach Walton at brett@circleofblue.org. Graphics by Trevor Seela, a former Circle of Blue intern and a Chicago-based undergraduate student at the Medill School of Journalism at Northwestern University.

*Note: The first water price survey, published by Circle of Blue in April 2010, used population figures from the 2000 Census, while the 2011 survey used 2010 Census data. Although Baltimore has dropped out of the 20 largest cities over the last decade, the city remains in the water rate index for consistency.

Circle of Blue gathered water rate information from the website of each city’s water utility or from the utilities themselves. Prices are based on single-family residential rates and are current as of April 1, 2011. Average monthly prices for cities with seasonal rates were calculated using seasonal weighting.

]]> http://www.circleofblue.org/waternews/2011/world/the-price-of-water-2011-prices-rise-an-average-of-9-percent-in-major-u-s-cities/feed/ 10 http://www.circleofblue.org/waternews/2011/world/alaska-bulk-water-company-receives-export-contract-extension-wants-to-split-with-partner/ http://www.circleofblue.org/waternews/2011/world/alaska-bulk-water-company-receives-export-contract-extension-wants-to-split-with-partner/#comments Wed, 02 Feb 2011 17:30:37 +0000 Brett Walton http://www.circleofblue.org/waternews/?p=25336 True Alaska Bottling sends a notice of dissolution to S2C Global, which rejects disbanding their joint bulk water export company.

By Brett Walton
Circle of Blue

Last week in Sitka, Alaska, the city assembly voted to extend—by six years—a bulk water export agreement with its sole water rights contractor, despite comments suggesting there has been a rift between the contractor and its partner in their venture to open a market for regular trade in shipped water from North America to India and the Middle East.

At a January 13 board meeting for Sitka’s industrial development zone—which houses the water export infrastructure—Terry Trapp, the chief executive of True Alaska Bottling, told the five-person board that his company was severing its relationship with S2C Global Systems and dissolving the joint venture, formed in 2008, to export Sitka water, according to the meeting’s minutes.

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In addition, Trapp told the Sawmill Cove Industrial Park Board that True Alaska, which holds the rights to 2.9 billion gallons per year from Sitka’s Blue Lake reservoir, would enter into direct negotiations with potential buyers in India and the Middle East. These negotiations are currently led by S2C. Because of insufficient facilities abroad and construction work that still needs to take place in Sitka, Trapp did not expect any exports to take place before 2012.

Yet the end of the partnership, named Alaska Resource Management, may not be a fait accompli. S2C’s president Rod Bartlett told Circle of Blue in an email that, as the main shareholder, S2C had not consented to dissolving the joint company. Additionally, as of his last conversation with True Alaska, Bartlett said that he still anticipates selling Sitka water.

Trapp told Circle of Blue in a phone interview that True Alaska’s lawyer had sent a notice of dissolution to S2C’s legal representative, but that he would have to follow up on whether it had been received. He declined to comment on why the notice was sent.

Last July, S2C announced the creation of a ‘water hub’ in India, which would serve as a distribution center for water shipped in 80-million-gallon tankers from Alaska using True Alaska’s water rights. No water has yet been shipped, and many water experts are skeptical that a regular sea-borne trade will ever materialize, since desalinated water is significantly cheaper and does not rely on foreign sources.

S2C has had no sales and is operating at a loss of $5.6 million dollars since its inception in 2004, according to its most recent filings with the Securities and Exchange Commission.

True Alaska first received rights to Sitka water in 2006, and its failure to meet minimum export deadlines led to several contract renegotiations with the city assembly. Passed on January 25, the latest 6-year contract extension is the company’s third, stipulating a $150,000 penalty payable over two years.

Brett Walton is a Seattle-based reporter for Circle of Blue. Reach him at brett@circleofblue.org.

]]> http://www.circleofblue.org/waternews/2011/world/alaska-bulk-water-company-receives-export-contract-extension-wants-to-split-with-partner/feed/ 1 http://www.circleofblue.org/waternews/2010/world/saudi-water-use-%e2%80%98growing-exponentially%e2%80%99-higher-prices-needed-report-says/ http://www.circleofblue.org/waternews/2010/world/saudi-water-use-%e2%80%98growing-exponentially%e2%80%99-higher-prices-needed-report-says/#comments Sat, 23 Oct 2010 20:43:26 +0000 Brett Walton http://www.circleofblue.org/waternews/?p=23354 Agriculture is draining non-renewable groundwater reserves in the water-scarce country.

Saudi Arabia should end government water subsidies to lower demand and save its dwindling water supplies, the National Commercial Bank (NCB) said in a report released on Oct. 4.

Image courtesy NASA

The study identifies low rainfall, population rise and the government subsidies on water consumption, which make demand “artificially high,” as the main factors behind Saudi Arabia’s growing water scarcity. It also highlights the low financial returns on the country’s water-intensive agricultural sector.

“In our opinion, imposing more regulation on agricultural activities, coupled with removing the subsidies on water are possible solutions to save the strategic water resources,” NCB said, according to Emirates 24/7, a Dubai-based news agency that received a copy of the report.

The study adds momentum to an unfolding discussion in the country about the need for water price reforms, according to the daily newspaper Arab News.

Saudi Arabia is one of the world’s driest countries. It has no perennial rivers or lakes, and its renewable water resources total 95 cubic meters per capita – well below the 1,000-cubic-meter-per-capita benchmark commonly used to denote water scarcity.

But water is virtually free in the country. Consumers pay only 1 percent of the cost of water: a little less than $0.03 per cubic meter, according to Global Water Intelligence, which estimates the true cost of operating the country’s desalination plants and pumping the water to end users to be $6 per cubic meter.

To meet residential demand, Saudi Arabia desalinates water along its coasts and delivers it to cities near and far. Riyadh, the capital, is located in the center of the Arabian peninsula and gets most of its drinking water from a 289-mile pipeline.

The country operates 29 desalination plants, giving it the largest installed capacity in the world. As a result, energy demands in the water sector are significant. By some estimates, half of the domestic oil consumption is used for desalinating water.

To prepare for the future, the Saudi government announced a national initiative in January 2010 in cooperation with King Abdulaziz City for Science and Technology to use solar power in desalination plants. Though the program will start small with a 30,000 per-cubic-meter-capacity plant, eventually all facilities will incorporate solar energy.

But residential use is a small share of Saudi Arabia’s water budget. Roughly 88 percent of water use goes toward agriculture, which contributes less than 3 percent of the country’s gross domestic product, according to the Saudi Arabian Monetary Agency. Much of the water comes from fossil aquifers that cannot be replenished.

This lack of renewable groundwater is the country’s greatest concern, David Evans, a board member of the Saudi Arabia Water Environment Association, wrote in an email to Circle of Blue. Two-thirds of the water used in the country comes from groundwater, according to the United Nations Economic and Social Commission for Western Asia.

In response to the unavoidable shortage, the Saudi government decided two years ago to phase out domestic wheat production by 2016. This, in turn, has spurred government investment in farmland abroad.

Meanwhile, the domestic population has been growing at 2.5 percent recently, which will increase the number of people living in the country by 50 percent in the 20 years to 2020, according to the Ministry of Economy and Planning.

To secure water supplies, the government has ambitious plans to invest $186 billion in the same time period in water, wastewater and electricity projects. Last month, it awarded a $1.5 billion contract to South Korean firm Doosan for the Ras al Zour water and power project, slated to be the world’s largest desalination plant when completed. However, even breakneck building will not be able to keep up with demand if price reforms are not implemented in tandem.

Source: Emirates 24/7, Arab News, Global Water Intelligence, Saudi Arabian Monetary Agency.

]]> http://www.circleofblue.org/waternews/2010/world/saudi-water-use-%e2%80%98growing-exponentially%e2%80%99-higher-prices-needed-report-says/feed/ 1 http://www.circleofblue.org/waternews/2010/world/in-era-of-climate-change-and-water-scarcity-meeting-national-energy-demand-confronts-major-impediments/ http://www.circleofblue.org/waternews/2010/world/in-era-of-climate-change-and-water-scarcity-meeting-national-energy-demand-confronts-major-impediments/#comments Wed, 22 Sep 2010 08:44:22 +0000 Keith Schneider http://www.circleofblue.org/waternews/?p=22287 Plan to increase production, especially in drier regions of the U.S., reveals weakness in strategy

Photo © Brent Stirton / Reportage by Getty Images for Circle of Blue

The All-American Canal, the main water conduit from the Colorado River into the Imperial Dam, flows through the Imperial Valley, Calif. The U.S. consumes about 100 billion gallons of water a day. Nearly 85 percent is used for crop and livestock production. Of the 16.1 billion gallons that remain, half is devoted to producing energy.

By Keith Schneider
Circle of Blue

In November 2009, in pursuit of a cleaner energy development strategy that also reduced carbon and other climate changing gases, Interior Secretary Ken Salazar announced that his agency had identified 23 million acres of public lands in six southwestern states as prime locations for new solar electrical generating plants. Salazar also said that the Bureau of Land Management, an Interior Department unit that owns and oversees much of the western public domain, was encouraging new solar plant construction with a “fast track” permitting process. The process would make some plants eligible for federal grants and loans under the 2009 American Recovery and Reinvestment Act, which included nearly $100 billion for clean energy investment.

The dual announcement was anticipated by executives in the solar generating industry, who responded with an avalanche of applications to federal and state agencies to build more than 180 new solar plants in California, Nevada and Arizona. But senior leaders of other Interior Department units, most notably the U.S. National Park Service, also responded to the agency’s promotion of solar energy with unusually sharp critiques of the potential consequences to the Southwest’s natural resources, especially the region’s scarce water supplies.

Solar generating plants that use conventional cooling technology use two to three times as much water as coal-fired power plants, according to the U.S. Department of Energy’s National Renewable Energy Laboratory. Newer technology that relies on air for cooling uses much less water, but also is less efficient in generating power, thus requiring more land. The Congressional Research Service recently estimated that solar power plants cooled with water could generate 53,000 megawatts of electricity in the Southwest, equal to more than 50 large coal-fired utilities, but also would require 164 billion gallons of water annually, an enormous amount in the driest region in the country.

In February 2009, Jon Jarvis, then the head of the Park Service’s Pacific West Region, and now the Park Service director, took the unusual step of warning his Interior Department colleagues that a solar construction boom in the desert, which results in dozens of conventional wet-cooled solar plants, could tilt the already fierce competition for water in the Southwest the wrong way.

“In arid settings, the increased water demand from concentrating solar energy systems employing water-cooled technology could strain limited water resources already under development pressure from urbanization, irrigation expansion, commercial interests and mining,” Jarvis wrote in the internal memorandum.

Confrontation Unlike Any Other
In almost every way imaginable, Jarvis’ warning is emblematic of the critical choke points emerging in the United States as rising demand for new sources of energy confronts the nation’s diminishing supplies of fresh water.

Four months ago, in Choke Point: U.S., Circle of Blue set out to better understand what was happening around the country as communities, businesses, and residents confronted the increasingly intense competition between water and energy. Our reporting from the coal fields of southern Virginia, the high plains of the Dakotas, California’s Central Valley, the Midwest’s farm fields, Northern Alberta, Canada, and elsewhere identified urgent contests between energy development and water supply that can be resolved. But taming the conflict between energy and water also poses extraordinarily difficult challenges to regional economies, governing practices, technological development and the quality of natural resources.

Most importantly, though, Choke Point: U.S. raises significant concerns about the values and principles that form the basic foundation of national energy policy in the era of rapid population growth, rising energy demand and climate change. The DOE has prepared a number of studies, accepted largely without question, that predict that as the nation’s population reaches more than 440 million in 2050, energy demand will increase by 40 percent. Federal authorities, along with technical specialists in private industry and academia, insist that such demand can be met by producing more energy sources from fossil fuels and nuclear power, and by developing cleaner energy sources such as wind, solar, geothermal, biofuels and wave energy, which also have the benefit of reducing emissions of carbon dioxide that are warming the climate.

Photo © J. Carl Ganter / Circle of Blue

ROCHELLE, ILLINOIS, AUGUST 2010: The Illinois River Energy biofuels plant in Rochelle releases plumes of steam at sunrise. The ethanol plant processes over 40 million bushels of corn into 115 million gallons of fuel grade ethanol annually. The plant is one of hundreds around the country transforming corn into ethanol. It takes nearly 1,000 gallons of water to produce a gallon of ethanol from irrigated corn: four gallons from unirrigated corn.

Underlying the nation’s strategy is the principle that the nation can meet its rising energy demands by applying technology and characteristic American innovation to the job of generating more energy.

But in Choke Point: U.S., Circle of Blue found that without significant changes in approach, meeting the demand for 40 percent more energy by mid-century –if it’s even possible – will come at an extraordinary price to the nation’s air, water, land and quality of life. Rising energy demand and diminishing fresh water reserves are two trends in dramatic collision across the country. Moreover, the speed and force of the collision is occurring in the places where growth is highest and water resources are under the most stress: California, the Southwest, the Rocky Mountain West and the Southeast.

“What’s missing in our national energy discussion is efficiency and conservation,” said Sandra Postel, an author and director of the Global Water Policy Project. “You save energy and you save water. We need a coherent policy and practices to emerge, and they haven’t yet, that drives water conservation and energy conservation. Every gallon of gas you don’t put in a car saves 13 gallons of water. But we aren’t talking about that nearly enough right now.”

Water Supply Confronts Energy Demand
Indeed, Choke Point: U.S. found that while federal energy experts, and their colleagues in academia and industry pursue an energy development strategy strongly devoted to more production, they are not paying sufficient attention to addressing the water supply, the primary impediment.

Scientists define water consumption by two basic measurements. One is how much water is withdrawn from America’s rivers, lakes and aquifers for domestic, farm, business and industrial use, most of which is returned to those same sources. The second is how much water is actually consumed in products, by livestock, plants and people, or evaporates in industrial processes.

In both measurements of withdrawal and consumption, energy is at the top of the charts. The United States withdraws 410 billion gallons of water a day from its rivers, lakes, aquifers and the sea. About half is used to cool thermoelectric power plants, and most of that is used to cool coal-powered plants, according to the most recent assessment by the United States Geological Survey (USGS).

Similarly, the country consumes about 100 billion gallons of water a day. Nearly 85 percent is used for crop and livestock production. Of the 16.1 billion gallons that remain, half is devoted to producing energy.

Graphic created by Ball State University graduate student, Daniel Cooper.

In just three years, North Dakota has established itself as the number four oil producing state in the nation—but at what cost to its water supply?

Federal and state regulators, and even coal industry executives grudgingy acknowledge the ropes of ecology, economy and efficiency that are tightening around the nation’s energy sector. Climate change is leading to decreased supplies of rain, snowmelt and fresh water. But as the contest between energy and water grows steadily more fierce, the United States seems intent on bypassing the conflict.

In one of the most startling findings of Choke Point: U.S., Circle of Blue reporters discovered that a far-reaching federal program of research and analysis, funded by Congress and designed to help the nation anticipate and temper the mounting conflict between rising energy demand and diminishing supplies of fresh water, has been brought to a standstill by the DOE.

The research program, known as the National Energy-Water Roadmap and ordered up by Congress as part of the 2005 Energy Security Act, was meant to provide lawmakers and the executive branch two studies of the impending conflict between energy and water. The program also explains what to do about the collision. The first, completed by a team of federal scientists in December 2006 and made public a month later, described the serious consequences the nation is already encountering, as the United States encourages more energy production, which is the second largest water-using sector, but gives scant consideration to water supplies, which are in retreat in most regions of the country.

Meanwhile, the second and final report that Congress commissioned—a comprehensive research agenda to better understand the nation’s energy—water choke points and begin developing real world solutions – has been held out of public view for more than four years. The DOE declined repeated requests for interviews about the reasons for keeping the report from publication.

Photo © Greg Latza / Hess Corporation

STANLEY, NORTH DAKOTA, SEPTEMBER 2009: An oil drilling rig on the Bakken Shale formation at sunset.

Other Major Findings
Choke Point: U.S. also found:

• Unless the United States plans more carefully, generating energy from clean alternatives is almost certain to consume much more water than the fossil fuels they are meant to replace. Generating one gallon of fuel from irrigated corn, for instance, takes 650 gallons of water. Generating one gallon of gas from oil takes one gallon. Solar thermal power that is conventionally cooled consumes more water than a coal-fired and nuclear-powered plant. Of all the available green energy technologies, only wind and solar photovoltaics consume less water than fossil-fueled energy. Geothermal can save water or consume more depending on the technology used and the location.
• The region that is confronting the energy water choke point first and most dramatically is the Southwest, as climate change steadily diminishes snowmelt in the Rocky Mountains. The Colorado River transports less water than it did a decade ago. Lake Mead, which stores water from the Colorado River and is one of the largest reservoirs in the country, is 41 percent full. The lake’s water level has fallen 135 feet since it was last full in 1999. Declining water levels have prompted federal managers to reduce the Hoover Dam’s hydroelectric generating capacity 33 percent. Federal authorities say if the lake falls 25 more feet, the dam’s generators will be pushed to operate beyond their designed capacity, threatening to shut down one of the largest power plants in the West.
• The next era of hydrocarbon development is well underway in the United States as energy companies tap the “unconventional” oil sands of Canada, the oil shales of the northern Great Plains, and the gas shales of the Northeast, Texas, Oklahoma and the Upper Midwest. But tapping each of these carbon-rich reserves is producing more damage to the land, generating more carbon emissions, and using three to four times as much water than the conventional oil and gas reserves they are replacing. Essentially, the energy industry is becoming a mining industry, turning carbon-rich sands into fuel and using water shot into the ground under super high pressure to shatter deep shales to release oil and gas. The scale of the industrial enterprise is immense and moving with amazing speed. In tar sands production alone, oil companies and pipeline developers are spending $15 billion to develop the tar sands; $30 billion to build a new network of pipelines from Canada to U.S. refineries (including one that has produced a dispute between state and the EPA), $20 billion to modernize refineries in the Great Lakes, Illinois, Oklahoma and the Texas Gulf. Earlier this year, Exxon Mobil paid $41 billion for XTO Energy, which has big reserves in tar sands, deep gas shale and oil shales in the United States.
• Developers in North Dakota are spending roughly $7 billion annually to drill 1,000 wells a year now into the Bakken Shale formation and are reaping a bonanza—100 million barrels of oil and 100 billion cubic feet of gas this year. The state is the nation’s fourth largest producer of oil now, behind Texas, Alaska and California. Three years ago, it was barely in the top ten. And the industry also is using billions of gallons of North Dakota’s scarce groundwater to fracture the shale, and generating a civic pushback from farmers and rural residents concerned about the supply of groundwater.
• The source of more than half of the natural gas produced in the United States is deep shale reserves underlying the Northeast, Gulf Coast states, the West and Midwest. But each of the thousands of wells drilled each year into the unconventional gas shales requires three million to six million gallons of water injected under high pressure to fracture the rock and enable gas to flow out of the rock. Accidents involving so called “fracking” have caused contamination and interruptions in water supply in Wyoming, Pennsylvania, Colorado and other states. The U.S. Environmental Protection Agency is studying the safety of the practice.
• The political influence of the energy industry has no equal in the U.S. In Kern County, Calif., where the agriculture industry and the oil industry compete for diminished supplies of water for irrigation and energy production, the big winner is the oil industry. While a severe drought wracked the state, and agricultural and environmental groups wrangled over sharply reduced water shipments to irrigate the arid San Joaquin Valley, the oil industry received 8.4 billion gallons a year—as much water as it needed—from the web of aqueducts and canals that carry water from rivers and reservoirs high in the Sierra Nevada.
• The energy vector in the United States points strongly to more fossil fuel consumption, not less. That means much more climate changing emissions and tighter fresh water reserves. For instance, the utility industry has opened or begun construction on 32 new coal-fired plants since 2008, according to the DOE. Those plants represent 17.9 gigawatts of new energy and 125 million more tons of carbon dioxide each year. They also represent the sharpest increase in coal-fired power in a generation and will consume billions of gallons of water a year. Unconventional tar sands and shale oil reserves in the country (North Dakota, Montana, Utah, Wyoming, Colorado) contain two trillion barrels of oil—enough to supply America at the current level of demand (7 billion barrels a year) for hundreds of years. The deep gas-bearing shales contain millions of trillions of cubic feet of gas—also enough to supply the country for centuries.
• Carbon capture and storage technology, which is the favored tool to reduce carbon emissions from fossil-fueled electric generating plants, is undergoing a handful of tests, including at a new electric-generating plant just permitted and partially financed by the DOE in arid Kern County. But the technology also increases water consumption at coal-fired utilities 40 percent to 90 percent, according to the DOE.

These findings, the first in a multi-media reporting project that Circle of Blue intends to pursue for the remainder of this year and through the next, represent a new way to look at the economically essential and ecologically damaging accord between energy and water. Choke Point: U.S. is among the first comprehensive assessments that bring that conflict into sharp national focus.

It is not just that energy production could not occur without using vast amounts of water. It’s also that it’s occurring in the era of climate change, population growth and steadily increasing demand for energy. The result is that the competition for water at every stage of the mining, processing, production, shipping and use of energy is growing more fierce, more complex and much more difficult to resolve.

Graphic created by Ball State University graduate student, Mark Townsend

Energy production withdraws and consumes more fresh water than any industrial sector other than agriculture. With the exception of wind power and solar photovoltaics, all of the clean energy resources available to the United States use more water than producing energy from conventional fossil fuel and nuclear energy.

“As a nation we really are not willing to understand the issues around controlling energy supply so that it doesn’t lead to water conflict,” said Mike Hightower, an energy systems analyst at Sandia National Laboratories in New Mexico and one of the nation’s top experts on the water-energy choke point. “The issues are interdependent. But not enough people are willing to connect the dots. And there are real issues at play. Will water scarcity limit natural gas production from the gas-bearing shales, for instance? Will water limit construction of new power plants? Will energy production be limited by the water supply?”

“Politicians don’t like to look at the big picture,” Hightower added. “They want to focus on one thing. And right now that is meeting the energy demand, and to some extent reducing greenhouse gases. But it has to be managed differently so we don’t damage our water resources.”

Keith Schneider is Circle of Blue’s senior editor. Reach Schneider at keith@circleofblue.orgs

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