Wastewater: an untapped solution to water access

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A sign of the times: major newspapers are reporting on the growing concerns in official circles over the environmental threats to the planet. Such was the case following the UN’s annual World Water Day on 22 March. To counter the water shortages that look sure to become critical in some regions, UNESCO and UN Water this year used the event to urge politicians to “[shift] the paradigm of wastewater management from ‘treatment and disposal’ to ‘reuse, recycle and resource recovery’. Such a proposal would have seemed ludicrous just a few years ago, but now reflects a real and increasingly pressing need.

Demand for water is expanding constantly worldwide while, at the same time, global warming and growing pollution are likely to cut into quality water resources in many parts of the world. This lies at the root of one of the UN’s 17 Sustainable Development Goals – “Clean Water and Sanitation” – which urges all member nations to “achieve universal and equitable access to safe and affordable drinking water for all” by 2030.

According to the 2017 UN Water report “Wastewater: the untapped resource”, two thirds of the world’s population currently suffers from a lack of water during at least one month each year. And an estimated 80%-plus of wastewater worldwide (and more than 95% in some developing countries) is returned to the environment without any treatment whatsoever.

Processing wastewater to make it suitable for consumption again will require heavy, long-term investment. Producing and installing complete treatment systems using proven techniques such as nanofiltration, ozone, ultraviolet light, and reverse osmosis will have to be expanded aggressively over the next 20 years, with projected annual growth rates of 14% to 15%.

And water access challenges could also have dramatic geopolitical repercussions, which are often covered up or poorly recognised. Water politics – or hydropolitics, as this field of study is now referred to – concerns itself with the need to avoid ‘water wars’ by resolving the water access equation, which will become increasingly crucial in countering potential destabilising conflicts. For example, the historic drought that hit Syria in 2007-2010 is one of the major factors behind that country’s current turmoil, according to observers in the region .

As the UN Water report points out: “The potential benefits of extracting resources such as energy, nutrients and other useful by-products from wastewater go well beyond human and environmental health, with implications on food and energy security as well as climate change mitigation.

“In the context of a circular economy, whereby economic development is balanced with the protection of natural resources and environmental sustainability, wastewater represents a widely available and valuable resource.”

BNP Paribas Asset Management’ portfolio managers responsible for  our environmental mutual funds closely follow developments in the water industry, which are crucial for understanding the world of tomorrow.

Written on 10 May 2017

Alexandre Jeanblanc

Investment Specialist, SRI

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