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2011 Water Conference Report FINAL

2011 Water Conference Report FINAL

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 Fourth AnnualInitiative
Global Environmental Leadership (IGEL)Conference-WorkshopWorld Water DayMarch 22, 2011
The Initiative for Global Environmental Leadership (IGEL) at the University of Pennsylvania’s
Wharton School sponsored a conference entitled
“Valuing Water: Business Challenges an
Opportunities for Innovation”. The conference was held on
World Water Day (March 22, 2011).An outgrowth of the 1992 United Nations world sustainability conference in Brazil, World WaterDay has been celebrated every year since 1993. For 2011,
its theme is “Water for Cities:
sponding to the Urban Challenge,” and that focus, especially as presented by the world’sgrowing “megacities,” was very much front and center at the Wharton/IGEL water conference.
 Vincent Price, the University of Pennsylvania provost, in his welcoming remarks reminded
attendees that the school’s founder, Ben F
ranklin, was
nicknamed the “Water American” by his
colleagues (who preferred to drink beer) at an English print shop. He also called attention to the
new 24-acre Penn Park, designed with a state-of-the-art water conservation system,including an underground cistern and man-made swales, that preserved some 26,000 cubic feetof water during a recent rain event.To open the conference, Eric Orts,
IGEL’s director and a Penn law and management professor,
summed up the problem of valuing water by saying,
“What’s often missing in the
 business discussion is the price of water.Water is often free or next to free, which is why
it’s difficult to make an
 argument that companies should pay for it. But the people who understand  the importance of water tend to use water differently and think about it
Panel #1: Business Challenges for Water Management, Strategy and Policy
Panel #1 consisted of Robert Giegengack (Penn); Will Sarni (Deloitte), Joe Rozza (Coca-ColaCompany), Jeffrey Fulgham (GE Power & Water), Carol Collier (Delaware River BasinCommission) and Christopher Crockett (Philadelphia Water Department). It was moderated byEric Orts (Wharton).Robert Giegengack, a Penn geology professor, was the first speaker at the morning session. He
 pointed out that Franklin’s well was six feet away from his outhouse, a practice— 
that demonstrates forward progress in water sanitation.
Water allocation is to some degree a population issue, said Giegengack, who noted that the worldcounts 6.8 billion people in 2011, and is likely to grow to just under 10 billion by the end of thecentury. The amount of fresh water available for human use is a tiny percentage of all the wateron earth (oceans are 97.41 percent of the total, for instance), he said. But, he added, all water isrecycled and fresh water supplies are adequate for human needs
the annual precipitation over
the state of Pennsylvania alone is 10 times the world’s consumption requirement, estimated at
four liters per person per day.However, growth in human per capita demand is higher than the population, as people eat higheron the food chain, Giegengack said. Water is also heavily used in industrial processes and inagriculture. Energy production is also water intensive
(a subject covered in IGEL’s “ValuingWater” report, issued in conjunction with the conference)
, and human energy use per capita isalso growing faster than the population. These factors mean that despite water conservation
efforts, we’re actually moving
rapidly away from sustainable management of this preciousresource.Giegengack cited several examples, including very limited per capita water availability in northAfrica and shrinking resources in the Colorado River Basin. He described the Colorado as 23percent of the available water resources on the west coast, but under incredible stress (from out-of-basin transfers to agriculture, industry and cities such as Los Angeles, Phoenix and LasVegas) almost from the day the Colorado River Compact was enacted in 1922. Because of suchtransfers, increasing over time, the 1922 water commitment to Mexico is rarely met.Other river basins under stress, according to Giegengack, include the Jordan, Nile, Tigris-Euphrates, Yangtze and Mekong. Overdrafts from the 10,000-square-mile Ogallala Aquifer,which extends through eight states and is the principal water source for the High Plains U.S.,brings it down a meter annually.As solutions to human water overdrafts, Giegengack proposed a variety of conservation methods(including efforts to reduce evaporation and leakage), inter-basin transfers, technologicalimprovements to irrigation practices, stepped-up desalination, and reduced industrialconsumption
which can involve replacing drinking-quality water with reclaimed grey water.
People can also eat lower on the food chain, and “improve” food crops to make them less water 
“The water cris
is is more threatening to human welfare than climate change and more
immediate than the energy crisis,” Giegengack said.
Some 884 million people don’t have access to clean water, but world water withdrawals areincreasing and 47 percent of the world’s pop
ulation will face some degree of water shortage by2030, said Will Sarni. He is a Deloitte Consulting director who leads Enterprise Water Strategy
for the company’s sustainability services
, and author of the forthcoming book 
Corporate Water Strategies
(Earthscan).Water availability will be an increasing concern for corporations, Sarni said, and the issue isbeginning to have an impact in board rooms.
“The public expects industry to have a role, though
full disclosure of water use is still
an issue,” Sarn
i said. Water scarcity issues are easier for the
public to understand than carbon, he said, adding
, “Water is where carbon was five or six years
We’re moving toward tiered pricing for water, but we’re not sure yet what it ideally looks
Investors, too, are putting pressure on corporations. Sarni pointed out that the Carbon DisclosureProject (CDP), launched in 2000 and representing 137 investors with $16 trillion in assets,branched out into water disclosure in 2010. Its questionnaire on the issue went to 302 largecompanies, with 122 responding publicly. More than 50 percent said they expect to be exposed
to water risk within the next five years, and 39 percent said they’re currently experiencing such
impacts (from drought, flooding, reduced water quality, or legal pollution-related entanglement).And corporate leaders themselves are recognizing that future success is going to dependincreasingly on access to water. The water risk to industry is decidedly non-trivial, said Sarni. Hequotes a GlobeScan/Circle of Blue report, which concludes that competition for fresh water will
 be so acute that “virtually every industry in the world will require sweeping, systemictransformation over the next decade.”
 Corporations are evolving water stewardship strategies, Sarni said, with the challenge of incorporating water concerns into corporate governance in a way that engages stakeholders. Hesaid getting to that point demands a multi-prong strategy that includes:
Measuring the corporate “water footprint.”
Determining regulatory risks and challenges to brand reputation. “
Sustainability isdriving brand-
name value across all sectors,”
Sarni said. He cites a Circle of Blue surveythat concludes 80 percent of the public believes that significant help is needed frombusiness to solve drinking water problems.
Aligning water risk programs with climate risk strategy.
Increasing stakeholder engagement and developing a reporting plan.Chip maker Intel, which has factories in water-stressed regions such as New Mexico and hasinvested $100 million in water conservation since 1998, provides a corporate success story, Sarnisaid. The company has saved 36 billion gallons of water through its conservation programs,enough to supply 335,000 U.S. homes for a year. Currently, Intel uses up to eight billion gallonsof water annually in making chips, but has a goal of reducing use to below 2007 levels by 2012.When an international corporation uses water as a major ingredient of its product line, itsconcern is amplified. The Coca-Cola Company is acutely aware of its water challenges, said Joe
Rozza, Coke’s global water resource sustainability manager.
The company, which operates in200 countries with more than 300 franchise bottlers and 900 manufacturing plants, uses 76billion gallons of water annually
. “Water security is an increasing
important issue for Coca-Cola,
Rozza. “Our goal is to fully implement our water strategy
, and replenish 100 percentof the water we use,
 by 2020.”

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