The Net Zero Challenge: the water industry must take a deeper approach

As the UK prepares to host the 26th UN Climate Change Conference of the Parties (COP26) in Glasgow this November, it's an appropriate time to reflect upon where the global water sector sits with regards to its influence towards net zero.

Net zero commitments are gaining momentum in many different countries and economic sectors. Given the water industry contributes a third of the UK’s greenhouse gases from industrial and waste management processes, key questions need to be asked and addressed. Is the sector moving quickly enough – and collectively enough – to deliver the huge shift in approach that is required?

Investor groups are already becoming more vocal in calling out companies across many industrial sectors for a lack of progress with regards to reducing emissions. Standards like the Task Force on Climate-related Financial Disclosures (TCFD), are also being used to help them understand who is and isn’t taking the issue seriously. Governments around the world are starting to state their intention to introduce TCFD as a mandatory reporting standard, starting this year, for large listed companies.

And while a commitment to making progress towards carbon neutrality is currently an expectation, it will no doubt soon become a requirement, making it increasingly important for each and every organisation working across the water system. It is a huge challenge, but one which critically must not be seen as a threat.

This is an opportunity for those in the water sector to develop a whole new approach, to de-risk their businesses and organisations, and future proof themselves. It can make businesses more attractive to future investors and protect the long-term viability of the industry within which they work at the same time.

Whole system approach’ required to truly move towards Net Zero

Certainly, for the water sector to make any significant step forward, a ‘whole systems’ view - aligned to TCFD requirements – is required.

Carbon emissions are a feature of every aspect of every organisation in the water sector’s activities and to make any credible move towards becoming truly net zero organisations must commit to a much more rigorous and deeper level of analysis with regards to understanding where they fit in the overall picture. Only by doing so will organisations truly be able to make decisions on investments and developments with knowledge of their impact on their carbon footprint in the long term.

Essentially, the water sector needs to change from leading with the focus on resilience to recognising the contribution it must make to decarbonisation.

Assessing your organisations impact

Detailed analysis of an organisation’s spending data can start to reveal where the less expected emissions might be being generated or hidden, something we found at Arup when we worked with SEQ Water in Australia. For example, a well-intentioned intervention in one part of the water system could cause additional carbon emissions somewhere else in the system. Building more pipes may be the only solution to make water supplies more resilient, but could actually increase emissions through construction and operation as a result.

How will a water company make decisions on such developments in the future? How will they justify decisions given their environmental responsibilities to shareholders who have invested interests in the profitability, not saving the planet? What about the impact upstream and downstream of their work too, and how will this be taken into account? Can they demonstrate that water is collected and managed in the most efficient manner within the catchment area, and what about how customers use that water once it is delivered to their properties and homes?

Water companies must understand and include supply chain partners – and users – in the assessment of their impact on emissions, and must work to find more efficient solutions at every step of the complete water cycle. A highly rigorous analysis is needed before any net zero plan is likely to work. It needs fresh thinking and innovation, not just system-wide, but water cycle and catchment-wide.

COP26: Will the UK lead the way?

Of course, it is not possible for some parts of the world to lead on reducing emissions related to water supply and management. For some, just having access to enough water for consumption and sanitation remains a struggle. It therefore falls on countries such as the United States, Australia and the UK. Given COP26 heads to Glasgow in 2021, now is the perfect time for the UK water sector to show how companies have come together to set their own goals, having recently published a route map for the sector.

Individual companies in the UK are now moving to develop their own net zero action plans, which are expected over the coming years. Anglian Water, which embraced the idea that working with the wider industry would strengthen their own future plans and positioning, is a great example. They decided to invest in the development of the PAS2080 guidance for carbon management in infrastructure – work that helped set their internal roadmap at the same time as bringing new clarity to an industry in transition.

The reality is that, despite it being a huge international challenge, there are few sectors in a greater position, and with greater motivation than the water sector to lead on the move towards Net Zero. The water sector is ultimately reliant on climate change being tackled with maximum effect, as the impacts of too much and too little water affect them more than any other industry.

One of the major opportunities is for organisations in the water sector with major land holdings to become more creative with their existing assets and land. Green infrastructure must be pushed harder, land must be put to better use, renewable energy such as solar power and onshore wind generation needs to be embraced more, and efforts need to be made for related industries in complementary fields to work in greater collaboration, such as energy and water, or energy, water and transport. New ideas need to be developed, but most importantly of all, the issue needs to be tackled holistically and collectively. No individual organisation in the water sector can stand alone in its work – a net zero approach must be at the heart of the water catchment and lead the way to a more sustainable future.