Reducing demand is cheapest option for water industry to cope with climate change

The report, Potential UK adaptation strategies for climate change, estimates that it will be cheaper to reduce demand through more efficient domestic appliances, water meters, recycling and changes in behaviour than to increase supply – for instance, by building more reservoirs, bulk transfer schemes and desalination plants.

While demand side measures to adapt to the best case scenario – a five percent shortfall in water resources by 2030 – would cost a maximum of £5 million, the lowest estimates for the cost of implementing supply side measures to adapt to the same scenario range from £5 million in the case of bulk transfers to as much as 1.3 billion, for the storage of winter river flows for future release (conjunctive use schemes).

To meet the worst case scenario – a 20% shortfall in water resources by 2030 – demand side measures would cost an estimated £80 million to implement, while the lowest estimates for the implementation of supply side measures range as high as £5.2 billion for conjunctive use schemes.

What’s more, the highest estimates for the implementation of supply side measures range from £440 million, in the case of desalination, up to £44.5 billion in the case of conjunctive use schemes.

The report, prepared for the Department of the Environment, Transport and the Regions (DETR) by Environmental Resources Management (ERM), based its estimates on three scenarios: a gap between water demand and supply of five, ten and 20% respectively in England and Wales over the next 30 years.

These scenarios are themselves drawn from research carried out by the UK Climate Impacts Programme (UKCIP). Highlights of this research published this week shows that climate change may lead to an overall increase in UK mean annual rainfall in conjunction with hot, dry summers. Water availability is expected to decrease, especially in the south and east of the UK due to reduced supply and increased water demand. There may also be deterioration in water quality, although the ERM report does not contain estimates as to how to deal with this or how much it might cost.

Although the ERM report says pressures on water resources are expected to be less acute in Scotland and Northern Ireland, its conclusion is that the UK water industry must build the need to adapt to climate change into its resource management plans.

The report points out that, regardless of what approach is eventually taken, water users are likely to bear most of the cost of the changes, either through water charges or by paying for domestic alterations, such as more efficient appliances, grey water recycling and rainwater collection.

While it says disagreement over what should be done is almost inevitable, the report advises a policy of implementing short term, ‘no regrets’ actions. These would include awareness raising of water scarcity issues, precautionary demand side management measures to achieve up to five percent savings in residential water use, and priority leakage reduction programmes.

The report contrasts the costs of these measures with the full costs of water shortages caused by inaction. “Once the full costs of water shortages are taken into account, measures which anticipate a five percent or even 10% shortfall are likely to start looking attractive,” the report says. “Furthermore, when the associated energy savings from demand side measures are taken into account there may be ‘no regrets’ in climate terms about investing to save five percent of residential water demand.”

However, the report warns that promoting demand side savings of even five percent would “require concerted effort by Government, water companies and NGOs to raise consumer awareness of climate issues and a clearer financial framework to provide incentives for water companies to promote demand management on the scale required.”