There are three main solutions to addressing water scarcity: countries must expand their access to water supplies; increase the efficiency of access; and improve the quality of the water provided. These can be achieved by encouraging investment in innovative companies specializing in water technologies – from delivery systems to desalination plants to wastewater management.
Unlike other natural resources such as oil, gold or coal, it isn’t possible to invest in water directly. Instead, investments can be made in companies that provide infrastructural solutions like pumps and pipes, or firms that produce water treatment systems or efficient irrigation technology.
One area that has seen a recent uptick in investment is desalination plants. With 97 percent of the world’s water in oceans, turning saltwater into freshwater is a popular – albeit energy-intensive and costly – choice in hot, dry countries with large coastlines. A 2015 Frost and Sullivan study expects desalination plant capacity to double by 2020. By 2025, the percentage of the population consuming desalinated water could jump to 14 percent from 1 percent today.
The replacement of aging infrastructure will also be an area of increased investment over the coming years. A prime example is the U.S., where a large proportion of water pipelines are now 100 years old, meaning they are nearing or have already passed the end of their useful lives. According to the American Society of Civil Engineers, there are now on average 650 water main breaks in America daily.
Spending on water infrastructure has been on a decline for almost a decade in the U.S., but with delays in investment no longer possible, local authorities are beginning to act. Upgrading won’t come cheap, though: the American Water Works Association says the country’s buried drinking water infrastructure needs more than $1 trillion worth of spending over the next 25 years.