Putting a Price on Water

25 August by


With the amount of rainfall we have had in the UK over July and August it is easy to forget that water resources are under threat on a more global scale.

At the Global Water Conference in Stockholm this week (August 24 2015) Junaid Ahmad, Director at the World Bank's water global practice, said; "We're headed into a perfect storm in which over the next 20 years we will see the demand for water growing significantly, driven by thirsty agriculture, thirsty energy and thirsty cities,"

According to a UN report published in March 2015, the world faces a 40% shortfall in water supplies in 15 years due to urbanisation, population growth and growing demand for water for food production, energy and industry.

California are in their 4th year of one of the most severe droughts on record.  Governor Brown declared a State of Emergency in January 2015 and directed state officials to take all necessary actions to prepare for water shortages. 

Food production in the state is under threat as the agricultural industry takes 80% of water used across California.  However, this problem goes beyond the state as the Californian Central Valley produces 25% of the U.S food supply and long-term damage to this could serious compromise food security across the country. 

They are not alone. Brazil is described as having the worst drought in 80 years; North Korea is facing its worst drought in a century; Severe drought conditions in the capital of Thailand, Bangkok have drained water supplies since June 2015 and the city is now in danger of running out of drinking water; and the European Drought Observatory (EDO) has reported that large areas of continental Europe have also suffered one of the worst droughts since the heat wave of 2003; particularly felt across France, Benelux, Germany, Hungary, the Czech Republic, Italy and Spain.

Globally, more than 660 million people still live without access to a clean water supply, according to figures produced by UNICEF and the World Health Organisation.  The global water infrastructure is such that it is still failing many living in developing nations.

Junaid Ahmad said achieving the new water goal and scaling up access means not only building pipes, but also fixing institutions and improving governance.  Another challenge, he said, is putting a price on water.

"We are in a world in which we are trying to price carbon, but we do not know how to value water," he said, adding that because water is a human right, there is an assumption that it should be free.

According to a recent article in the Guardian; “Globally, we now drink as much packaged water as we do milk. At 30 litres per person per year, bottled water is the second most popular liquid refreshment after carbonated drinks – a market that it is set to supplant carbonates this year if predictions prove correct.” (9 July 205) 

The madness is that it takes between 1.4 and 3 litres to make 1 litre of bottled water! With limited water resources, can this industry be sustained?

If the world is going to achieve their goals on food and energy security, sustainable urbanisation, and ensure the delivery of water and sanitation to all its citizens, new ways of preserving and distributing our precious water reserves will have to be devised.

Maybe a water tax is as step in the right direction.


Thomson Reuters Foundation
Steven Johnson Blog – “Apocalyptic Schadenfreude”
Climate Progress
EDO Drought News 2015