Who owns water? Experts debate pricing, infrastructure investment

Who owns water? At The Atlantic's Green Intelligence Forum 2010, water experts debate whether public or private entities own the world's water supply -- and how that impacts efficient distribution.
Written by Andrew Nusca, Contributor

WASHINGTON, D.C. -- Who owns water?

Does the public own it? Does the federal government? How about private entities, such as farmers and manufacturers?

Who gets to foot the bill when something goes wrong -- or when it's all gone?

Those were the questions debated this morning at The Atlantic's Green Intelligence Forum 2010, where water experts weighed in on the difficulties in framing a global water crisis.

According to the experts, water is certainly not free -- but establishing ownership gets tricky once you try to price it to curb excessive usage.

"On the one hand, one can be agnostic about it, simply because it's either a public monopoly or private monopoly, and both of those are regulated," said economist and Resources for the Future fellow Sheila Olmstead. "We can't, on the whole, say that in many developing countries. Where we've had strongly negative experiences is where the regulatory structure is simply not [robust] enough to support that. There's this really important regulatory side."

Former Arizona governor and World Wildlife Fund trustee Bruce Babbitt said the question of who owns water isn't nearly as important as who distributes it.

"I think you start off by saying, 'Water is a public resource,' " he said. "That is the American tradition. You can deal out the management and use through regulations, which have an economic aspect to them. To move toward privatization as you go down stream. It's not about owning the water, it's about how you're allocating the water, providing the resources and providing a return."

Pacific Institute president Peter Gleick said the costs incurred by distributing water requires a set of laws to protect both the resource and the business.

"The important distinction is ownership versus service," Gleick said. "In Islam, water is supposed to be free. But some very smart Islamic scholars are saying, 'Well, who's paying for the service?' Water should be public. Public or private, it's a monopoly. You need efficient, smart, non-predatory services. There are badly-run examples on both the public and the private sides."

The other issue is water rights, Gleick said.

"I don't think water rights are property rights. I think they're use rights," Gleick said. "In the West, this is a big debate. There are use rights -- you have the right to use based on where you are. In the constitution of the state of California, that use is based on it being reasonable and beneficial. If you don't have that reason, you can't use it.

"So take a farmer growing four acres. If they can grow it in three, that last acre is not reasonable. [The issue of] rights is unresolved, and it's wrapped up in this public-private question."

ITT senior vice president Gretchen McClain said different business models and partnerships between industry and government are the way to tackle the real goal -- reducing water usage.

"Today, we have leakage and good [money] going down the drain," she said. "There's got to be incentives."


To address quality and scarcity from an economic perspective, water should have a price, Olmstead said.

"The price of water is artificially low," she said. "If it reflected the opportunity cost of not leaving it in-stream and the price of getting it to your house, it would make everything look better. And it would provide investors with incentive for more developed technologies to improve efficiency."

Babbitt called the argument a "false dichotomy" and advocated for a price on water.

"Water is a human right," he said. "Everyone should pay something. There should be that step toward the market -- it's a concept called 'block rates.' People should understand the system and pay a small amount, and it should scale up with consumption."

Is water ready to be bought and sold on the market? Gleick said anything deemed a resource essential to human well-being isn't by its very nature.

"If water were truly a private commodity -- there were markets for it -- ecosystems would be, pardon the technical term, screwed," he said. "They have no money. They have no standing rights. We have to figure out how to protect these systems. It's a public good."

McClain said the ownership question complicates accountability, especially with regard to federal oversight.

"There is different accountability -- the EPA makes decisions, the Interior makes decisions -- [and] it's very fragmented," she said."If we can't get it to where we can get alignment on that, do we ever get to the solution we need? Look at the national infrastructure debate today -- water is not on the agenda. That to me is a huge, glaring oversight."

Public awareness is key, McClain said.

"I still think there's a lot to be done to stop taking water for granted, she said. "It's the lifeblood of our lives, of industry -- without water there's no growth, no economic development. It's a global issue, but it really has a local face. Technology is out there to address the issues. Given the market is very fragmented, we need to work together. To make sure that the public understands the value…of water."


So what's the solution to using water more efficiently? McClain said the technology's already available -- it's just a matter of inserting it into existing infrastructure.

"The infrastructure in the U.S. is aging and it's failing us," she said. "There is technology today to go into the leaks and close up the leaks, or you can do a complete dig-up. But with technology that's out there, you can make the system more efficient. It's not a lack of technology. It's about addressing something before it fails."

Efficient water use "doesn't require rocket science technology," Gleick said.

"There is remarkable technology that involves replacing pipes without digging up the streets, that involves inserting pipes into pipes," he said. "There's wastewater treatment technology. There's innovative monitoring and metering technology to understand where we have these leaks."

There are remarkable changes already underway, Gleick said.

"This summer, Los Angeles used less water for everything than it used 40 years ago, despite the growth in its population and economy," he said. "We are changing the dynamics already. Sometimes there's not enough water for everything we want to do as inefficiently as we're using that water."


But it was Babbitt who shook the foundations of the topic of discussion by saying that the phrase "global water crisis" was merely "Leninist history." Calling himself a skeptic, Babbitt said the "relentless talk" of a crisis was, in effect, scaremongering.

"There is no lack of water on this globe," he said. "There is not a water supply crisis. Water is a renewable resource. There are some distributional issues, yes. But we're not going to make any progress into buying into this notion."

The real issue? Sanitation and accessibility in the developing world, he said. Gleick agreed, but said Babbitt's argument was based on semantics.

"Water is a huge issue. It's connected to everything we care about," he said. "I believe there is a global water crisis, in different places in different times. My issue: the failure to ensure that people have access to clean drinking water. But there are other problems [like] climate change. Water is connected to climate change -- that's a new challenge for the 21st century that we're just beginning to wrap our minds around."

Water distribution and efficiency also impacts food production, for which 80 percent of the world's water is used, Gleick said.

"Water is a political issue -- it crosses borders. We share water with Canada and Mexico. In many parts of the world, it's a security issue. There are political issues with water that are not well resolved."

Citing a survey conducted by her company, McClain said that 95 percent of voters believe water is the most valued resource they receive -- more important than electricity. It's why people will pay for water and the costs incurred to distribute it, she said.

"Any economy doesn't grow unless you have power and water," she said. "The issue is really around clean water. We spend an awful amount of money to make water clean. I don't think people realize the cost of taking water, cleaning it and delivering it to the home.

"We lose 1.7 trillion gallons of water each year because of our aging infrastructure, just leaking away after it's been cleaned. That's a huge cost to each of us. When someone turns on the tap and they don't have water, that's when we feel it."


And what of climate change? Babbitt said that "solid scientific consensus" on the topic means that a one meter rise in sea levels is "baked in" over the next 100 years. The problem? The nation's infrastructure isn't ready for it, he said.

"Sea levels in this coming century are going to rise at least one meter, which is going to make obsolete the water and infrastructure systems of every coastal city in this country," he said, adding that unpredictable weather will only magnify the lack of flexibility in existing infrastructure. "These coastal systems are going to be useless. We must have a national policy and we must get started soon."

Gleick said we're not doing enough to manage our water systems for climate change.

"In the Bay Area alone, there are 29 wastewater treatment plants that are at risk of flooding from a one-foot increase," he said. "We need to mitigate the aspects that we can't adapt to. That means greenhouse gases. Three feet's going to be tough enough. Twenty feet is inconceivable."


The panelists also discussed the issue of groundwater, a hidden water resource that's quickly being depleted by developing communities with no alternative.

Babbitt called the issue "important" and "complex."

"It's out of sight," he said. "We don't fish in groundwater or sail our boat on groundwater or watch a sun set into groundwater. We must recognize the connection between groundwater and its role and generating surface water. The connection is an important issue. You've got to manage that thoughtfully and carefully."

In most parts of the world, groundwater is a non-renewable resource, Babbitt said.

"It has accumulated since the Ice Ages," he said. "It must be treated as a finite resource. It will not be refilled in less than geological time."

From a legal standpoint, groundwater is difficult to resolve, and is the "Wild West" from a rights perspective, Olmstead said.

"On one hand, it's take as much as you can," she said. "On the other hand, it's a critical resource in many areas of the world where we have large populations who need access to water, in part because surface sources are so contaminated."

Gleick said the issue calls for a technological solution.

"We don't monitor it, meter it, manage it," he said. "It's often over-pumped. That's unsustainable. As much as 30 or 40 percent of the world's food production comes from groundwater."


So how will we conserve water -- through economic, environmental or sociological means? It starts with education, Gleick said.

"Public awareness is a critical piece to this," he said. "The more we know about water, the more we understand where it comes from."

Gleick said the United Nations' recent declaration of a binding human right to water and sanitation was an example of how minds can be changed.

"We haven't had this for a lot of reasons. But we do now," he said. "It's very explicit. It doesn't say it has to be free, or that it's unlimited, but it does say that there's a basic human right to water and sanitation."

McClain agreed, saying that a recent visit to Singapore revealed that young children are taught about their water system from a young age.

"We do need to think about the cycle of water," she said. "It has to be addressed in a closed-loop cycle."

McClain said it's time to start thinking about water the way space-bound astronauts do -- as a limited, finite resource that requires demand management.

"Having been in the space business, astronauts recycle water," she said. "Do we have the appetite for it [on Earth]? "

Babbitt said he had a foolproof solution to whet America's appetite.

"Pricing," he said. "I rest my case."

Photo: D. Sharon Pruitt/Flickr

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