Water Risks on the Rise for Three Global Energy Production Hot Spots

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07 November 2013 | Tianyi LuoPaul ReigAndrew Maddocks and Tara Schmidt

A ship transports coal in China. Photo credit: foxxyz, Flickr

This piece was co-written with Tara Schmidt, a senior analyst at Wood Mackenzie.

Energy runs on water. In fact, among industries, the global energy sector is the world’s largest water user. Almost all forms of energy production and power generation depend upon water for their operations. This tension causes stress in both the energy and water worlds. Three-quarters of energy respondents to a 2012 CDP Global Water Survey confirmed that they experienced water-related operational risks, while half experienced water-related detrimental business impacts in the past five years.

new report highlights where these risks are especially significant. Energy and consulting firm Wood Mackenzie, supported by data and analysis from WRI’s Aqueduct Water Risk Atlas, surveyed water risks among the world’s top energy-producing regions. They found that three energy sectors face particularly high water risks: shale gas in the United States, coal production and coal-fired power in China, and crude oil in the Middle East.

For more, read Wood Mackenzie’s new report: Troubled waters ahead? Rising water risks on the global energy industry.

Read on for more detailed insights and WRI’s key takeaways here.