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World Energy Council warns of global power generation water crisis

March 22nd, 2016

The World Energy Council is warning that without “integrated planning” on water consumption in power plants, “we will start to see the effects of water scarcity on energy supplies in the very near future”.

The council’s secretary-general Christoph Frei said that “the energy-water-food nexus poses a systemic risk which could impact the robustness of the energy supply and demand over many years to come.

“Power plants across the world could be affected by changes in precipitation patterns, which are combining with increasing competition between water users to adversely affect the resilience of energy services.”World Energy Council secretary-general Christoph Frei

To back up its warnings, the WEC sites a 2016 research paper in the journal Nature that predicts that 98 per cent of global electric power generation will be affected by a shortfall of available water by 2030.

At last week’s Asia-Pacific Energy Leaders’ Summit in New Zealand, the WEC presented its own report, ‘The road to resilience – managing the risks of the energy-water-food nexus’, in which it calls for immediate action to secure resilient energy infrastructure.

The report makes five recommendations: Improve understanding of the water footprint of energy technologies in order to mitigate the risks of stranded assets; Account for the ‘price’ of water, particularly in areas of water stress; Consider a wider range of financial and insurance instruments to hedge short term risks such as adverse weather incidents and associated electricity price volatility; Give investors the confidence to invest by providing them a full risk assessment that includes different climate and hydrological scenarios in financial analyses; Provide a reliable and transparent regulatory and legal framework that takes into account water issues and competing stakeholders’ interest.

Frei said: “Clear co-ordination and integrated planning needs to take place now, or we will start to see the effects of water scarcity on energy supplies in the very near future. Assuming a water price during project planning is one way to trigger the right signals.

“If we are to counter the problems of water access, then cross-border co-operation is vital. We should be taking full advantage of the 261 international trans-boundary basins that cover 45 per cent of the earth’s land surface. Energy resilience can only be achieved by moving from individual to joint efforts.”

To read the full report click here

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