The Paradox of Water

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By James G. Workman

IBM recently made the case for harnessing human ingenuity to help conserve the Great Lakes. And Bayer HealthCare just boasted about new proprietary system that saves 20,000 gallons per day. But both companies miss something big: without the right political foundation, such new technology may drive us to use more water and energy.

This paradox emerged in 1865, a time when industrial England ruled the world. But as ‘peak coal’ grew scarce, the country feared it would deplete its own lifeblood. Boosters dismissed the need for conservation and pointed to ‘high-tech’ steam engines, which improved efficiency, requiring less coal to generate more energy.

Enter 29-year-old economist William Stanley Jevons. His studies measured the effects of supply and demand, and found that widespread access to efficiency technology would actually speed up depletion as more people used more machines to burn more coal: “It is wholly a confusion of ideas to suppose that the economical use of fuel is equivalent to a diminished consumption. The very contrary is the truth.”

Over 146 years coal’s alternatives – wind, oil, gas, nuclear, solar, hydro, geothermal – all stepped in to fuel growth. But his logic remained incontrovertible. What’s more, the steam engine burned up another element, which in 1865 England seemed negligible but is today both precious and scarce.

And unlike coal, water has no substitute.

To counter global water scarcity, governments and industry once again tout and subsidize efficiency technology. As IBM noted, the company awarded his own city (Milwaukee) with a Smarter Cities grant to harness water technologies. Likewise the US Environmental Protection Agency (EPA) has set up a WaterSense partnership that designates and labels certain qualifying technologies that claim to “protect the future of our nation’s water supply by promoting water efficiency and enhancing the market for water-efficient products, programmes, and practices.”

So, by itself does water-efficient technology work? Can new widgets alone make up the projected 40% shortfall between global demand and supply in the next 19 years?

The ghost of Jevons moans: Don’t bet on it.

The US EPA claims WaterSense technology helped consumers save a cumulative 46 billion gallons of water; Mr. Smith claims Ford Motor Co. used 26.8% less water. I don’t doubt those numbers. But I do ask: what happened to all that saved water? Did it stay in rivers, lakes or aquifers? Alas, there is scant evidence local conservation translates into an overall reduction of water use, consumption and demand.

In fact, empirical studies suggest that – as with Jevons’ energy – water efficient technologies may in fact reduce supply via lower costs and increased demand from added opportunities and incentives to divert, pump and use even more water.

My dual flush toilet means my daughter takes longer showers. My uprooted lawn encourages my neighbor to install a back yard pool. Our water-efficient neighborhood lets the larger city approve a sprawling new development. Firms reduce the amounts of water per unit throughout the supply chain, and that helps them to sell more water-embedded products. It’s likely EPA offset demand for 46 billion gallons by making it cheaper or free to others, while ‘free riders’ guzzled up the savings by Ford.

Likewise, from Texas cotton fields to Israeli orchards, technology gains do not return flows to the Rio Grande or Jordan River or West Bank Aquifer or water-restricted Palestinians. Rather, efficiencies spread more new irrigation of water-intense crops into marginal lands at the exclusion of competing natural and human communities.

Understandably, social advocates and environmentalists resist water efficient technology that undermines their goals.

Such a perverse and undesired outcome defines a key paradox of water: as long as we ‘rent’ our resource from a natural monopoly, water-saving devices will increase systemic consumption. Water that you and I frugally conserve is lost through new and collective augmented demand.

The fastest way to resolve this paradox is through a new (and yet timeless) system of clear dominion over water, in what might best be called “H2Ownership.”

If all end users sharing the same basin or water system had a proportional stake in the outcome – based on, say, our historical use – then we would graduate from “ratepayers” who see water as a liability into to “shareholders” who see water as an asset. Then, whatever we save from our share we can take out of the equation, to be later sold at a premium to higher users, or donated to charity, or restored directly to nature.

From the Kalahari to Oman to Indonesia, variations of this system appear where people compete to conserve, and nature keeps its integrity. Under a scaled up digital version of this virtuous cycle, urban efficiency gains could be locked in and improved on, helping us to transform water scarcity into natural abundance.


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About James Workman

James G. Workman is a Visiting Professor at Wesleyan University’s College of the Environment. He is the award-winning author of Heart of Dryness and co-founder of SmartMarkets LLC, a software company that helps water and energy utilities unlock the value of their liquid assets and unleash a widespread, egalitarian and competitive race to conserve.


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