Regional water concerns are creating significant financial risks, thanks in large part to advanced global commodity trading and energy industries’ high dependence on water. And it’s a trend that is poised to worsen. BP projects a 36 percent increase in global energy consumption by 2030, while the Water Resources Group predicts that in the same amount of time freshwater supplies will fall 40 percent short of total demand globally.
The water–energy nexus is becoming one of the great challenges of our generation—one that also holds significant implications for political leaders and investors alike. This article explores how water risks are already impacting the world’s coal industry, and how risks will change over time.