New tool enables businesses to monetise water risk

Water technology firm Ecolab has developed a new online tool that allows businesses to work out how water-scarcity will impact their revenue.

The new revenue-at-risk function estimates the value of the revenue that a facility could potentially lose due to the impact of water scarcity on operations

The new revenue-at-risk function estimates the value of the revenue that a facility could potentially lose due to the impact of water scarcity on operations

The freely-available Water Risk Monetiser was first developed in 2014, but the upgraded version that analyses revenue impact was unveiled this week at World Water Week in Sweden.

“As water scarcity increases around the world, business leaders need actionable information to help them understand and manage their current and future water-related risks,” said Ecolab chairman Douglas M. Baker, Jr.

“The Water Risk Monetizer helps businesses make informed decisions to enable growth in this new era of water scarcity.”

How it works

The original model calculated a risk-adjusted water cost by correlating local water scarcity to specific factory considerations such as the amount of water it uses.

The new revenue-at-risk function estimates the value of the revenue that a facility could potentially lose due to the impact of water scarcity on operations.

Specifically it compares the estimated amount of water a facility requires to generate revenue (cubic meter per USD of revenue) to the facility’s share of water in the basin if water were allocated among water users based on economic activity (contribution to basin-level GDP).

If more water is required than the basin share of water allocated (as determined by the model), then a proportion of the facility’s revenue is potentially at risk.

 

For more information on this topic, check out edie’s Top 10 business benefits of reducing water consumption.

In other news from World Water Week, hotel chain IHG announced an ambitious new water stewardship programme, and the World Resources Institute predicted the most water-stressed countries in the world over the next 25 years, with the UK ranking surprisingly high.

Brad Allen


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| water | Water scarcity | world water week

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