As of 2019, 2 billion people live in countries experiencing high water stress and about 4 billion people face severe water scarcity at least one month of the year. At a time when rapid urbanisation, economic expansion and climate change threaten our finite water resources, utilities across the world are fighting to ensure clean affordable water for all by being innovative, collaborative and open to change.
Utilities are either state-owned entities or private businesses. In countries like Australia, the water industry is run by large publicly owned utilities which operate within distinct service boundaries and smaller municipal entities which offer services in regional or rural areas. Private entities in Australia provide crucial supportive services to these utilities by handling components of core service delivery or through innovation and consulting. In other countries like the UK, where the water industry is privatized, water services are provided by privately-owned businesses with an economic regulator to regulate prices and ensure that these businesses provide proper service and prioritize consumers.
Utilities proving that public ownership does not have to be a deterrent to progress
State-owned utilities are making significant strides to surmount various obstacles due to political and legislative constraints that arise from being publicly owned, and in the process, positioning themselves as utilities of the future. For example, in Australia, cultural changes in Melbourne’s water utilities and stakeholders enabled the city to respond effectively to the millennium drought[1]. In Singapore, the country’s national water agency uses treated recycled water to supply up to 40% of the population’s water needs with this value expected to rise to 55% by 2060.
Greater collaboration continues to be a key catalyst for change
These utilities are partnering, locally and globally, with other organisations to collaborate on aspects including capacity building, risk management and innovation. These partnerships include various stakeholders in water or non-water sectors like energy companies, communities, local governments and private entities. A municipal water entity in Australia is overcoming resource limitations by partnering with a private sector player to implement smart metering in its network – an initiative that has reduced peak water demand by 12%. The Netherlands and South Korea recently signed an agreement with Indonesia to tackle various water issues in Jakarta and neighbouring areas. As part of the agreement, the Netherlands will support Indonesia in reducing groundwater consumption, constructing new drinking water facilities and combating water pollution. Through cross-border collaborations like these, developing nations, a lot of which are already struggling with issues related to water security, can imbibe best practices from other nations and improve access to clean, affordable water.
Utilities are looking inwards and revolutionizing the way they operate
Water entities are taking steps towards modernizing internal operations and culture and embracing new business models. Besides looking at ways to improve core service delivery and become industry leaders in advocating the use of latest technology, organisations are also prioritising increased community involvement by engaging with them at a deeper level and improving the quality of discourse.
Water utilities in the United States are rethinking existing business models and turning to innovation management as a catalyst for creating flexible organisations. These utilities are quickly able to adapt to new technologies and disciplines to propel themselves forward. Similarly in Australia, utilities are finding innovative ways to tackle the issues of water security. The way Australian utilities harvest and treat storm water has received international recognition and is a leading example of changing existing core service delivery methods in order to face challenges of increasing complexity.
Innovation is tailoring solutions to circumstances that are unique to the industry
The industry is increasingly relying on innovation to solve unique and ever-increasing water security challenges. Governments and companies are embracing water stewardship and focusing on sustainable water management. The sector is also beginning to explore data analytics as data driven insights have significant potential to impact the way utilities, consumers and governments see water as a resource and how the industry plans, invests and manages water infrastructure in the coming decades.
A city in Sweden has recently commissioned a self-adapting water reuse plant to ensure continuous water supply in a city that has historically struggled with adequate drinking water supply. This particular plant uses software that enables the plant to self-adapt its processes based on the quality of input water. In Singapore, low temperature desalination plants are utilising low-grade industrial waste heat to produce high-quality freshwater – a system that minimizes electricity demand for a technology that generally consumes up to 10 times more electricity than traditional water extraction methods.
Key policy reform is enabling long-term industry sustainability
Governments are increasingly looking at key policy reform measures to enable progress in the industry. New governance arrangements in Australia have been put in place for the industry, which has made water utilities independent trading enterprises and removed government subsidies and cross-subsidies between user groups. This puts a greater focus on financial performance as utilities have to deliver safe and secure water systems that are sustainable while the entities themselves must be financially sound. This has made water a controllable cost for industry and consumers and has resulted in a substantial decline in water consumption per capita.
The UK and Wales privatized its water industry in 1989 in order to bring much needed investment to the sector, as publicly owned water authorities at the time were affected by limits on public sector borrowing that were imposed to contain inflation, with a regulatory body in place to regulate prices and protect the interest of consumers. As a result of this, nearly £160 billion pounds has been invested in the sector and water leakage is down by 30% since the mid- 1990s and average water bills are broadly the same as it was 20 years ago, once inflation is taken into account.
A case for improved private sector participation
The private sector shows various degrees of participation in different countries. As water and sewerage companies across the world are increasingly being pushed to do more with less, they are being forced to put operational efficiencies at the top of their agenda. This has opened up new opportunities for businesses with a focus on providing solutions, enabling a more sustainable water industry in the process. Regulatory requirements and user experiences are also forcing utilities to focus on consumers, providing the private sector space to enter the industry in increasing capacities. Privatisation of the industry has had varying degrees of success, but it is clear that with regulatory oversight in place to ensure the customer is protected, private water entities can bring much needed innovation, technical knowhow and industry experience in the table and can also foster trans-boundary collaboration between industries.
Conservation key to sustainable growth
Today’s challenges demand that the prime focus of the global water industry should be on conservation and sustainability in water consumption and extraction. In recent years, measures like rain and storm water harvesting and desalination has gained a lot of traction, especially in countries which have an inherent lack of access to freshwater. Utilities are also aiming to minimize their energy consumption by implementing waste-to-energy plants to offset energy consumption of wastewater treatment plants. The industry is also looking more and more towards renewable energy which is allowing them to reduce their carbon footprint and minimize long-term operational expenditure. In order to meet Sustainable Development Goal 6, these efforts have to be ramped up further and at a significantly greater scale. This means that utilities have to place an even greater emphasis on conservation of a finite and critical resource like water.
A bright future ahead, although significant challenges remain
Water and wastewater related
organisations across the world are striving to change the entire ecosystem
around how we extract, consume and manage water – from implementing new
technologies to harnessing the power of renewables and even making wholesale
changes to the way they operate and provide services with an increasing focus
on the consumer. Although progress has been made with 80% of countries having
laid the foundations for integrated water resources management, the fact is
that we still have a long way to go – As of 2015, 844 million people across the
world still lack access to basic drinking water, 80% of wastewater goes into
water without adequate treatment and 70% of the world’s wetlands have been lost
over the last century. All these factors will put an increasing amount of
stress on global finite water supplies with half the world’s population
expected to suffer severe water stress by 2030, assuming business as usual.
Efforts across the board needs to be ramped up globally, with greater
cross-border collaboration and significant regulatory reform critical to ensure
long-term global water security.
[1] The 2000’s drought in Australia, thought by many to be the worst drought recorded since the European settlement, affected most of Southern Australia, including the Murray-Darling basin.
