B4

RICK BUCKINGHAM
FROM THE HIP

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Goldman Sacks, an American Investment Bank, has estimated that global water consumption is doubling every twenty years and has drawn the conclusion that its current rate of consumption is not sustainable.

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Hugo Miller/Bloomberg News

The use of heavy subsides for water in most parts of the world often means water is squandered because cost isn’t an issue. Analyst’s at JPMorgan have inferred that Nestle, Unilever, Coca-Cola, Anheuser-Busch and Danone consume 575 billion litres of water per year, enough to satisfy the daily water needs for every human on this planet.

Haven't we heard this mantra with respect to oil supply and reserves? Another interesting factor that comes into play is that there is no substitute for water compared to commodities such as oil of which there are alternative sources of energy such as natural gas, coal, and wind power to name a few.

Climate change is also playing havoc with supplies of fresh water supply and its availability in very complex ways that often lead to droughts as witnessed in countries such as Australia and sub Sahara Africa.

Supplies of water, the clean variety that is easily accessible to the majority of the population, is starting to see strain on the supply side due to growing global population and an emerging more financially equipped middle class in Asian countries. These people want the benefits that people in the west have enjoyed for years by way of a water intensive lifestyle.

Here in North America water is cheap by world standards and almost an entitlement. Industrialization in poorer countries is contaminating rivers and other water reserves because they don't employ the same safety protocol that we follow here again in North America. Subsides on biofuel production have increased the harvest of water intensive crops that are presently being used for energy and food supplies.

Add to this the use of heavy subsides for water in most parts of the world, often means water is squandered because cost isn't an issue.

Water is an essential ingredient in many products we find in our grocery stores. Analyst's at JPMorgan, a leading U.S. investment bank, have inferred that Nestle, Unilever, Coca-Cola, Anheuser-Busch and Danone consume 575 billion litres of water per year, enough to satisfy the daily water needs for every human on this planet. This is a starling statistic that I'm sure will have to be addressed sometime in the 21st century.

Although agriculture uses the lion's share of the world's fresh water supply, many other products and/or services depend on water for their very existence. An example is energy production. Each year 40 per cent of freshwater drain from lakes and aquifers in North America is used to cool power plants.

Separating one litre of oil from the tar sands, a costly alternative fuel made viable by high crude prices, requires an astounding five litres of water to extract.

In Silicon Valley in California, chip making for computers is thought to account for 25 per cent of the water consumption in that region. Nestle, the chocolate conglomerate based out of Switzerland, has stated that is takes four litres of water to make one litre of product on balance in all of their factories worldwide. It takes 3,000 litres of water to grow the agricultural produce that goes into it.

Cutting consumption of water like oil may be the only alternatives we have that makes business sense. Using less water reduces spending on water acquisition, treatment, and on the cleanup of waste water. Water conservation and re use options in the longer term may be the worlds only alternative. We may have to look at countries such as Australia who are used to draughts and the consequences for best practices as they have lived with water shortages it seems for a lifetime.

Water will, at the present rate of consumption, become the oil of the 21st century.

Rick Buckingham is president and CEO of Canadian 2 for 1 Pizza Inc. based in Fredericton. He can be reached by e-mail at rbuckingham@nb.aibn.com. His column appears Tuesdays.