Energia e agua juntos

Quick Take: The California drought is highlighting the energy-water nexus. That's the nerd name our industry uses to describe the interdependence between water and electricity. (And we'd better find a better term soon, because that one's not going to cut it when communicating to consumers and policymakers).

Kate Zerrenner of the Environmental Defense Fund (EDF) has just released a post that nicely summarizes why electric and water utilities will be collaborating closely from here on out. I hope that's something that both sides will want to do. But it won't really matter. The situation is getting bad enough -- especially in certain parched regions -- that they won't have any choice.– Jesse Berst

"We must begin a long-overdue conversation on asymmetries in how the energy and water sectors are priced, regulated and managed," argues EDF's Kate Zerrenner. "It’s no longer possible for each sector to just talk about the other. They must work together, and they can only do so once they’re on a more level playing field."

Many electricity providers are large, investor-owned utilities that act on a regional or national scale. Many water providers are small, public utilities with only a local reach.

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Electricity is clearly priced and energy efficiency is a central part of the energy sector. Water, on the other hand, is greatly underpriced and the inefficient use of water seems to be the norm.

The interdependence between energy and water has come to the spotlight recently thanks to California's historic drought. Southern California water comes with a high energy price tag because so much of it is pumped long distances from Northern California.

A balanced approach to water and energy would maximize efficiencies in both sectors. The city of San Antonio offers a good example.

"Each sector must view the other as a vital component of their collective futures," says Zerrenner. "Water is an energy resource and energy is a water resource. Equalizing the way we regulate and price the two is a step toward approaching these massive problems in a more systematic way."

Jesse Berst is the founder and Chief Analyst of SGN and Chairman of the Smart Cities Council, an industry coalition.