Water-Energy-Climate: Don’t Lose Power!

Water-Energy-Climate: Don’t Lose Power! There’s no doubt that water risks are here to stay from floods to rivers running dry. Corporates are worried too – not surprising, as we’ve seen water knock out national power.

So this month … power up with our new report and unpack sizeable interlinked water-energy-climate risks for a third of global power assets located in Asia. With extreme weather on the rise, is “just enough” power enough? Plus, get excited about new style energy investments.

Physical climate risks (often in the form of water) can be highly disruptive – extreme weather impacted around 250,000 Somalians and 540,000 in China in May alone. With risks escalating, it’s important to get disclosure right so that they can be assessed.

According to CDP, 3,909 companies are providing data on water security today and 93 FIs are assessing their portfolio’s exposure to water-related risks and opportunities.

Clearly water matters but can corporates leverage water risks to make billions rather than drown in them? CDP’s Regional Manager for Water Security, Erica de Souza says they can. See how companies can realize 4x more opportunities if water is integrated in long-term planning here.

While it’s good to see disclosure on the rise, you can only disclose what you know. As rising water risks can trigger a complex web of risks such as power disruptions that can threaten national energy security, understanding how water, energy & climate are interlinked is key, especially in power hungry Asia.

Generating electricity is water intensive. According to the IPCC, under all 2°C scenarios, the energy sector’s share of global freshwater use is projected to increase to almost a quarter by 2050; driven mainly by the rapid increase in electricity demand across developing nations.

As the IPCC also projects that 3-4 billion people could face chronic water scarcity, where are we going to find water to generate electricity?

Enter CWR’s new report – “No River, No Power – Can Asia’s rivers power growth in a changing climate?” – which analysed a third of global power generation capacity to find that water risks can strand sizeable portions of national power generation assets.

The findings are sobering … CWR’s analysis revealed that powergen assets of 16 countries with installed capacity greater than the G7 ex-US are clustered in 10 major rivers from the Yangtze, Yellow, Indus, Ganges, to the Mekong. There is sizable trifecta exposure with clear national energy security implications, from singular to multiple river dependencies – so get the low down now.

Worse still, adding more fossil fuel based power to meet development needs could result in a vicious cycle – more CO2 will exacerbate water scarcity, which in turn accelerates the stranding of power assets plus makes extreme weather even more extreme.

Already, last year we saw the Yangtze droughts disrupt power and global supply chains. But buckle up! Witnessing a ‘1-in-100-year’ extreme weather event in our lifetime is more likely than not – Italy just cancelled the F1 Grand Prix because of 1-in-100-year floods.

How can we futureproof our power systems to handle more extreme weather to come? How did China cope with the Yangtze’s hydropower shortage? Are there lessons from China for the world? We turn to experts Mike Thomas & David Fishman from The Lantau Group for insights as they walk us through “just-in-case” power.

Adding renewables can help mitigate the vicious cycle. Whilst people are talking a lot about hydro, wind and solar, there is less chatter over wave energy. Why is this not tapped more? We talk to Alex Zakheos Co-CEO of Sea Wave Energy Ltd to unravel wave energy’s potential and find out why it’s not a major player yet.

Zakheos is optimistic – he says the company’s novel tech “The Waveline Magnet” is the only wave energy convertor that could rival fossil fuels in terms of power, storage and costs. Plus, it can still work in energetic climates and be used as an artificial reef.

Clean energy solutions are here; we must adopt them faster as there’s now a 66% chance of exceeding 1.5°C in at least one year from now to 2027 (WMO). Ultimately, all carbon intensive energy assets around the world will raise Asia’s water risks.

The stakes are too high for Asia to not step up – we must get the power mix right to rein in emissions to alleviate water risks; plus futureproof our energy assets from rising water risks.

So don’t lose power! Make the right energy decisions today for economic, water and energy security tomorrow – start by unpacking Asia’s tight water-energy-climate nexus with the Executive Summary and power up with the full report.