Put a Price on Industrial Water Use, Report Urges Government

A federal advisory body has recommended that the Canadian government put a price on water used by industry, the Toronto Star reports.

In Charting a Course,  the National Round Table on the Environment and the Economy argues that a price on water will reduce intake by industry, leading to better water conservation and efficiency.

The paper acknowledged that industrial water efficiency is set to improve: it predicted that while water-intensive industrial activities will increase 40 percent by 2030, water use will rise only three percent. But that three percent rise may be unsustainable, the report said, especially given regional variations.

The roundtable argued that a water price of between five and nine cents per cubic meter could cut water intake by 20 percent without having any major drawbacks for business.

On the other hand, the report said that creating a water permitting system could create distortions to economic activity, while voluntary water conservation efforts have proven to be largely ineffective.

The roundtable found that the natural resource sectors make up 86 percent of Canada’s overall water consumption. But the study urged government to do a better job of tracking water usage, including who the end users are, how much each is using, and what they’re using the water for.

According to a new report by GP Bullhound, water pricing varies widely around the world. Prices are determined by political and local availability issues, and in many case do not reflect the resource’s true cost.

There is a trend in the U.S. and Europe of allowing prices to rise, with many examples of 20 to 30 percent increases in the past few years. But in some countries such as the U.K., regulations keep prices low, hindering investment in infrastructure.

Increasing water prices also impact end costs for manufacturers, GP Bullhound said. The chairman of Nestle now asks three questions of the company’s plant operators around the world, the report said: 1) What is your P&L? 2) What is your carbon footprint per dollar of sale? And 3) What is your water use per dollar of sale?