US EPA over the past week released a document titled, “The Importance of Water to the US Economy”. The report is an important step in linking economic welfare with that of water as it is design to raise awareness of water to the national economy while gather information on sustainable management in water.
Water is essential to life and it is a finite resource. These two highlights of water does not go well from the perspective of risk management. In the report, EPA admits that it is hard to generalize about water’s value because of how broad and complex water is. The report points out several industry sectors including agriculture, forestry, mining, energy, manufacturing, electric power, and public water supply as sectors that must be focused on in tackling the valuation of water.
Besides the economic perspective, the report also extends into the social welfare of water management. “Public water supply systems and water resource management agencies often make decisions that affect many aspects of social welfare.” These social welfares are often hard to measure in terms of dollar value and to make the problem more complex, water also has an environmental aspect including water quality and biodiversity. With such a strong introduction, the report led me to believe for a while that there are crucial information and encouraged me to read on
The report starts off with a rather obvious tone stating that given water is essential to life, it has a contribution to the US economy that cannot be measured. But the report articulates that a qualitative sense of dependence between water and the US economy through four elements: extraction, processing, delivery, and information.
US EPA from the report suggest that water risk is a common ground between all the various industries regardless of how water is used. The report cited the drought in 2009 to 2011 in Texas where much of the agricultural and livestock were affected leading to an increase in the value of wheat and beef. The report shows that even industries whom indirectly uses water are also very much at risk.
Connection talk takes up a large portion of the report as US EPA tries to link how the economy of water affects all industries and that good understanding of the connections is a must. Connections such as the energy-water-food nexus which forms the core of the nation must be analyzed to determine the best management system to protect not only the individual sectors but the economy as a whole.
Besides the importance of water to the economy, the economies of water is also vital, according to the report. The report breaks down the willingness to pay for water into five categories: quantity, time, space, reliability, and quality. The current estimate of the value of water are few and the range broad. Values ranging from $12 to $4,500 per acre-foot for one specific industry.
Overall the report reiterated many of what is already know in the water sector in that water is vital, it is a key component of any economy, and it is limited. Water is also hard to value and that a good water management system must be imposed to counter against the water risk that may occur. The report for more information which the water sector has been broadcasting all this time. I believe though no new information was added in the report, it serves a different purpose. The report is a declaration from the US EPA that it once again
Ta-You Huang is currently a Masters in Environmental Studies Student at The University of Pennsylvania studying with an emphasis on corporate sustainability.