Water shortages: the business risk you can’t afford to ignore

It’s hard to imagine a scenario in the UK where we run out of water. But experts predict that in 20 years from now, demand for water in the UK will outstrip supply.

“Hotter, drier summers and less predictable rainfall – two effects of a changing climate – plus over-abstraction of water for industry, agriculture and the public water supply as the population grows, is a toxic combination,” said Sir James Bevan, chief executive of the Environment Agency (EA), in a speech last year.

The EA estimates that if we don’t act, by 2050 the amount of water available in England could be reduced by up to 15%; that some rivers will have up to 80% less water in summer; and that we will need around 3.4 billion extra litres of water a day to meet our collective needs.

“Good water quality is essential, but the right water quantity is existential,” Sir James says. The fundamental threat is simply not having enough for people and wildlife to thrive.

Bottom line impacts

These statistics may be sobering enough to prompt action from responsible businesses. If not, the risk to company bottom lines should act as a catalyst.

Cate Lamb, global director of water security at disclosure not-for-profit CDP, says companies aren’t doing enough to address how water availability will impact on their operations.  “A large proportion of businesses still have the mindset that water will always be available to them whenever and wherever they need it, and that they don’t need to manage it like other issues,” Lamb says.

Recent research by CDP found that for 68% of the 1,112 publicly listed companies disclosing on water, water shortages could generate a substantive impact on their business.

The maximum potential financial impact was estimated at US$225 billion, while the cost of response was US$119 billion. More than half of businesses surveyed anticipate that issues around water could limit the growth of their business, either by reducing or disrupting production capacity, closing operations or constraining growth.

Where to start

Businesses can be a part of the solution and protect themselves by reducing their own water demand. Just over 20% of public water supply consumption is from non-households, such as business and industry, so the positive impacts could be huge.  

A quick first step is to identify leaks or excess water use on your sites that you may not have been aware of.

Spotting irregularities in your water bill is one simple way of doing this. BIU’s bill validation and query service can benchmark water usage and spot potential leaks when they happen, as well as identifying instances of overcharging. The financial returns can be significant, and any leaks are spotted promptly month by month.

Identifying areas of high consumption can act as a springboard for a more detailed water audit, or help to make the business case for investment in water efficiency technology or process improvements.