How can we ensure water resilience in a climate-altered world?

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Fabrizio Palermo, Chief Executive Officer and General Manager, Acea

• Water operators are pivotal players in driving a paradigm shift in the water management system to address the critical scenario imposed by climate change.
• An integrated industrial approach to water management paves the way for a new strategy concerning water infrastructure and reuse.
• Artificial intelligence presents both demanding challenges in terms of water consumption and promising opportunities for enhancing the water management system.

Climate change is exacerbating existing water stress and is already generating a measurable impact on the water cycle, altering the quantity, distribution, timing and quality of water. Moreover, a surge in water demand is unfolding due to new consumption patterns. Indeed, when discussing water, all sectors should be considered, ranging from agriculture to tech industries.

To ensure water efficiency, safety and sustainability, it is crucial to change how water services are managed. In this context, water operators play a key role in adapting the water management system to evolving needs and addressing three major themes: modernizing infrastructure, enabling water reuse and leveraging the potential of new technologies.

DISCOVER

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Water infrastructure

Despite its abundant water resources, Italy is facing a dramatic challenge with its water management system as its infrastructure has been severely neglected over the past decades. Today, due to a huge investment gap, old infrastructure is still being used: about 60% of the system is more than 30 years old and 25% is more than 50 years old.

This lack of investment is the consequence of the industry fragmentation in the country, with a notable absence of a comprehensive 360° industrial vision for the sector. This fragmented approach has stifled innovation, leaving the sector ill-prepared to harness the potentially transformative impact of technology.

Therefore, it is crucial to step up investments to realize a modern and interconnected network. Though the economic recovery instrument Next Generation EU has earmarked financial resources for the water sector, more investment is needed.

In this critical context, water operators, acting as regional or preferably national players, are the sole actors equipped with the industrial know-how and financial resources to address the challenges Italy is facing.

Re-using water

Precipitation patterns are changing in Italy, as well as in many other regions, in terms of quantity and geographic distribution, with significant economic impacts in all sectors. It is crucial to recognize that the challenge to ensure water availability extends beyond weather pattern change, however. Industries are large water consumers and projections indicate a further rise in demand. According to estimates, by 2025, 3.5 billion people will live in areas facing water scarcity, emphasizing the urgency of comprehensive water management strategies.

Resilience could be obtained by developing a circular water management system that maximizes water reuse. In Italy, only 4% of wastewater is reused, compared with the achievable 23%. And, in addition, there is the untapped potential of stormwater, of which only 11% is collected, compared to the achievable 35%. Water basins and reservoirs are fundamental assets, acting as backups to the system, by accumulating and regulating water for irrigation and as renewable energy storage.

Water operators can drive industrial solutions to maximize the value of water by ensuring the availability and quality of the resource, interacting with agricultural and industrial communities, understanding local needs and supporting innovative solutions for circular use.

At the same time, governments must incentivize the reuse of treated wastewater, establishing competitive tariffs within a supportive general regulatory framework. Additionally, upgrades to sewerage infrastructures and treatment plants would substantially enhance the protection of the receiving water body.

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Technology and water

In a world dealing with the effects of climate change, the coming years will see growing competition between different water uses. Indeed, most industries need vast volumes of water to run their production cycles. This is true not only for traditional industries, but also for the tech sector.

Among others, AI models have an enormous water footprint. In fact, in addition to consuming enormous amounts of energy, they also consume large volumes of water, for the most part, fresh water, to cool down the data centres on which they rely. For instance, a conversation between an average user and a chatbot consumes roughly the equivalent of a bottle of water.

These findings are even more alarming if we consider that in the last few years, the water intensity of the technology industry has skyrocketed. On a planet driven more and more by AI and digital data generation, it will become of paramount importance to take steps to ensure efficient water use. Hopefully, AI, to secure its existence, will provide the solution to tackle this increasingly daunting challenge.

AI should not be viewed only as a source of concern, but also as a stimulating challenge and a gateway to new possibilities. When integrated into a comprehensive industrial vision, AI holds transformative potential. By harnessing the power of AI, water operators can play a pivotal role in preventing and mitigating the impacts of climate change, developing innovative solutions for our water systems and ensuring a more sustainable and resilient future for our planet.

It is necessary to foster a water-focused business platform that originates and executes complex sustainable water projects. This platform includes partners with the right set of complementary competences and capabilities such as:

• Operational and technical competencies and a track record for the development and realization of water-related projects.

• Innovation of the water-industry technologies that should shape the sector in the next decade and close the innovation gap vis-à-vis other industries.

• Digital and data native ventures that unlock the value of data to develop value-added services related to water (e.g., loss and reduction).

• Financial resources needed for the scale-up of such an ambitious venture, also at the international level.

• Captive clients for which water is an essential commodity (e.g., data centres).

• International footprint to give the venture a global spin from the start and to leverage the best practices worldwide.