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Water Investment Report Says Water Prices Too Low

From C/Net News, March 30, 2007

Artificially low prices of water are preventing investment in technologies to improve infrastructure and provide fresh water to people, according to a report published on Thursday.

Sustainable investment research firm Progressive Investor said that there is impending water crisis in its “Investing in Water” report.

Fresh water supplies are being stressed because of population growth, industry and agriculture and climate change, the report said. In addition, $1 trillion is needed to upgrade the worldwide infrastructure of distributing freshwater.

There are available technologies to clean or desalinate water but utilities can’t afford to invest in them or upgrade infrastructure because water prices are subsidized at “absurdly low” rates.

The report notes, however, that there is growing awareness or water issues which will mean steady investments by utilities

“A few niche segments are experiencing rapid growth,” said Rona Fried, CEO of Progressive Investor. “Ultraviolet radiation and membrane filtration are growing 15% a year, as they replace chlorine for disinfection. Metering and monitoring are strong growth areas, as is desalination.”