The Future of Travel – The Global Challenge

The travel and tourism industry is often described as the largest industry in the world. It accounts for 9% of world GDP, $1.3tn in exports and 6% of world trade across multiple sectors, including transport (aviation, rail, road and sea), accommodation, activities, food and drink. It is estimated that it creates about 120 million direct and 125 million indirect jobs and is closely linked to other sectors in domestic and international markets, such as the manufacturing industry, agriculture and the service sector.  In turn, these create broad multiplier effects for local and national economies.

In 2012, for the first time in history, the number of tourists crossing international borders in a single year reached over one billion. While just over 50% of these arrivals were from Europe, much of the demand is being fuelled by rising household incomes in emerging economies – not only the Brics (Brazil, Russia, India and China) but increasingly across the rest of south-east Asia and Latin America. In addition another five to six billion people travel in their own country every year. Technological innovations are fuelling this growth, and include developments in low cost air travel and the widespread use of increasingly sophisticated applications that aid online researching and booking travel.

Mass tourism was one of the great game-changers of the 20th century. Thomson Holidays ‘Sustainable Holiday Futures’ report explains: “Cheap flights meant travel was no longer the preserve of a wealthy elite, enabling millions of people to travel beyond their border and dramatically widening the horizons, tastes and expectations of an entire generation in the developed world.” Today I see the mobilisation of the middle classes in the Indian Subcontinent, Asia and South America as the game-changer for the early part of the 21st Century.

In general people like traveling and which is probably why the industry has remained resilient, adapting in the face of a range of challenges such as armed conflict (particularly the Gulf Wars) and disease (Sars, H1N1, Foot and Mouth, and more recently Ebola), earthquakes and other natural disasters. Looking ahead the future looks positive; for example international tourist arrivals worldwide are expected to increase by c. 3.3% a year to reach 1.8 billion by 2030 with the majority of market share tipping toward the emerging economies over this period.

Despite the positive trajectory the Thomson Future Holidays report warns that the challenges for the industry are formidable: “The dream of affordable travel for all is being obscured by climate change, future long-term projections of rising fuel prices and a growing awareness among consumers that sustainability and responsible travel are set to have an impact on how we understand, embrace and manage our holiday plans.” Given this, I see that there are broadly two main challenges ahead for the development of a robust travel and tourism industry: how to continue to grow further to deliver jobs, exports, economic growth and development, and in doing so, how to manage this sustainably.

The Future of Travel – Options and possibilities

Considering growth, perhaps the first issue to be addressed should be the balance between convenience and security with border controls coming under increasing strain as they deal with huge volumes of people travelling internationally at a time when fears around global security are high.

The World Economic Forum’s Global Agenda Council believes that “the bureaucratic hurdles that often accompany visa procurement such as long wait times, absence of local consular offices and excessive documentation requirements discourage travel, constraining visitor spending and the jobs and growth it generates”, and that “The largest delays are caused by antiquated visa processes and can be easily reduced through utilization of commonplace modern technology”. Improved visa facilitation in G20 countries, it says, could create between 940,000 – 5.1 million jobs and generate US$149 -206 billion in international tourist receipts by 2015. It says that shifting away from in-person interviews and consulate-based application system to online applications, video interviews and application processing software can reduce staffing costs and produce immediate returns en route to widespread adoption of e-Visas and a coordinated global travel facilitation system. It’s paper ‘Smart Travel: Unlocking Economic Growth and Development through Travel Facilitation’ proposes “a smart travel model and blueprint that could revolutionize the travel and tourism sector, much the way smartphones have transformed the telecommunications and media industries”.

Clearly the challenge is to make travel safer but at the same time more efficient. Innovations in travel facilitation is essential for growth so look out for different forms of frictionless travel – streamlining visa processes with the introduction of e-visas for example: “As the world becomes hyper-connected, circular and citizen-centric, the right legislative framework, innovative financing and partnership models are crucial to facilitate travel. This includes smart visas, smart infrastructure (i.e. smart airports) and skills.[1]

The notion of technology driven travel is not confined to border controls. Smart cards similar to those used for localized, multi-modal urban transport (such as the Oyster card in London and Tisséo smart card in Toulouse) will increasingly be used not just for local transport solutions and for booking accommodation, activities, food and drink, but also at the level of predicting personal choices in hotel rooms, such as smart showers that predict the temperature we prefer, and smart meters that optimise our use of energy, temperature control, and so on.

Beyond this, smart technology has revolutionized how we choose to travel. We are no longer dependent on the wisdom of our high street travel agent and prefer instead to make decisions based on the experience of online crowds from the likes of Trip Advisor. Browsers and indeed our browsing habits are becoming increasingly sophisticated allowing us to choose our journeys by cross-referencing and sharing ideas as well as influencing the buying choices of others.  Looking ahead expect searches to be even more refined, with users having greater control over whose opinion they seek.  Combine this with the increasing use of smart devices and it is clear that ensuring they stay ahead of technological innovation will be key to survival for many (from SMEs to the large corporates) across all sectors of the industry.

Regulation will continue to have a huge influence over the aviation and transport industry. The key regulatory challenges are likely to be Air Passenger Duty increases, compliance with the EU Emissions Trading Scheme (ETS) and volatile fuel prices. The effects of the deregulation of the European railways in 2010 that allowed open access (i.e. all railway operators can now compete on international routes, and private companies can now pick up passengers outside their home country and operate cross-border trains) have yet to be realised. It is hoped that it will lead to competitive pricing for tickets, more seats on more trains and increased variety of rail products and services. Perhaps the most significant improvement (and one that looks set to grow in the future) is the multi-modal approach to air and rail. Many large German airports, for instance, such as Frankfurt, Cologne and Dusseldorf, now have modern rail stations that allow air passengers to continue seamlessly by rail to many destinations. The Chinese have also already significantly invested in mass transit by rail. As fuel costs make conventional air travel more expensive, in some regions, rail travel may replace domestic and even intercontinental flights.

Given that the travel and tourism industry is a huge employer, the development of and tighter controls on employment rights are likely to be a significant factor in the future. It is worth noting in this regard that there are few NGOs lobbying the industry on human rights; the UK-based charity Tourism Concern is a small but vociferous organisation that campaigns for a variety of human rights issues, such as the right to water for local communities, displacement and land rights of indigenous people, and porter protection, while Survival International campaigns for the rights of tribal people worldwide. As the travel and tourism industry boom continues, it is likely there will be many more issues to contend with in this regard, particularly regarding the expansion of urban landscape into traditional land areas in Africa and the expansion of oil production and timber felling in the tropical rainforests of Southeast Asia and South America.

Tourism is an under utilized tool for socio-economic development. In general it has had a positive impact on local community empowerment, especially for women. There are other intangible assets, such as encouraging greater global connectivity and cultural understanding. Awareness of this is increasing and community based tourism is on the rise with a growing number of holiday makers eschewing the crowded beaches and all inclusive packages to enjoy a more authentic experience living in the culture rather than observing it from the outside. The demand for localized, personal experience will grow over the next decade.  As a result the travel and tourism industry is becoming increasingly aware of its social responsibility so look out for increasingly sustainable travel options. Over the next decade travellers will base their buying decisions not only around comfortable beds, leisure facilities or the proximity to cultural attractions, they will also be able to choose to stay in places where they know the staff are being treated well and the local economy is not being exploited.

Some in the industry are already changing their ways of working. Thomson Holidays (part of the TUI Group) reports that companies will increasingly be held to account over their commitment to issues of a more sustainable tourism industry. Jane Ashton, head of sustainable development at TUI Travel, said: “Our research shows that our customers want us to take care of sustainability issues for them. So our challenge is to influence destinations and hotels to supply an infrastructure that allows our customers to be more sustainable.”

Thomson Holidays also predict that during the next twenty years, UK travellers will agree to pay for their water on holiday; take ‘Tradecations’ – cooperating with radical plans by hotels and resorts to slash their carbon footprint in return for carbon reward points that can be traded for visits to local sites of interest, spa treatments or dinner and drinks; discover holiday super-hubs and aerovilles as a new integrated global rail and sail network replaces domestic and regional air travel. With regard to carbon quotas, it warns there is a “potential double-whammy for the travel industry with governments worldwide predicted to impose personal carbon quotas”. The British government’s plan to reduce carbon emissions by 80% by 2050 “would give UK citizens an annual carbon quota of just 3.1 tonnes per person”, so the report concludes: “Such low quotas will encourage families to carbon-comparison shop.”

When practiced responsibly, tourism can also be a tool for biodiversity conservation – many national parks and other protected areas would no longer be able to survive financially without large number of visitors, and there are an increasing number of examples where ecotourism has helped save individual species, such as the mountain gorilla in Rwanda and Orang Utan in Borneo. A census announced this week in India reports that tigers numbers are up 30% over the last four years, which is in part due to tourism’s influence on the understanding of the economic value of tigers; that they are worth more alive than dead.

Increased awareness of environmental issues (and the rise of the ‘green consumer’) has inevitably led to a growth in the interest in environmental travel. As far back as 2010, around 50% of Americans that traveled abroad were engaged in nature, culture or heritage tourism and research commissioned by Trip Advisor suggested that 71% of its members intended to make eco-friendly travel choices in the future. So, over the next ten years look out for continuous growth in travel focused on learning about, experiencing or positively affecting ecological conservation, economic development and local community improvements, cultural respect or human rights.

However, if poorly managed, tourism can be a double-edged sword, having a negative impact on local populations and their natural environment (including degradation of local environmental quality, water consumption and waste management) as well contributing to greenhouse gas emissions. Unchecked and unregulated, the continued growth of the industry will also have implications for areas of significant cultural and natural importance. Of the 1007 properties listed on UNESCO’s World Heritage List, 46 are identified as ‘in danger’, such as the Everglades in Florida, the Selous Game Reserve in Tanzania, the Rainforests of the Atsinanana in Madagascar and the Virunga National Park in the Democratic Republic of Congo. UNESCO includes “unchecked tourist development” on its list of challenges that it says pose threats to World Heritage Sites; the others are: armed conflict and war, earthquakes and other natural disasters, pollution, poaching, and uncontrolled urbanization. Regulators and law enforcement officers must address this.

Beyond everything climate change will undoubtedly affect the travel and tourism industry, both in terms of the regulation of greenhouse gas emissions and the effect on the tourist industry of destinations adapting to climate change, especially those regions that already are exposed to extreme weather, such as at the equator and the poles, as well as vulnerable island states, such as the Maldives and many Pacific Islands, and low-lying coastal areas of industrialised nations that are vulnerable to sea water rises. Tourism bears some responsibility for this currently accounting for 5% of global greenhouse gas emissions – approximately 4% from transportation (40% of those from air travel and 32% from car travel) and almost 1% from the accommodation sector. As demand for air travel is forecast to double by 2050, and carbon emissions from flights departing the UK alone are forecast to increase from 33.3 MtCO2 in 2011 to 47 MtCO2 by 2050 expect innovations in transport infrastructure to begin to mitigate the damage being done.

One of the other options for tackling aviation’s contribution to greenhouse gas emissions is the EU Emissions Trading Scheme – a market-based “cap and trade” mechanism whereby emissions are capped at a set overall limit but are tradeable. Another solution is to address the source of the emissions produced by aviation through use of future aircraft technology, better operational flying techniques and the development of sustainable fuels. ‘Sustainable Aviation’, an alliance of the UK’s airlines, airports, aerospace manufacturers and air navigation service providers, has produced a ‘CO2 Roadmap’, which it says could reduce the UK’s aviation emissions by up to 24% by 2050. It says the UK could have between 5 and 12 operational plants producing sustainable fuels by 2030, which could generate a Gross Value Added of up to £265 million in 2030 and support up to 3,400 direct jobs, and a further 1,000 jobs.

[1] World Economic Forum

The Future of Travel – Proposed Way Forward


Smart visas, indeed, smart ticketing in general for mass transit provides a tangible way forward in addressing some of the barriers to the seamless growth of cross border visitor numbers.

Given unpredictable fuel costs in a climate-challenged world, the future for the aviation industry must surely lie with greater efficiencies in the short term and with alternative fuels used in the future, even if a global emissions trading mechanism is put in place. The railways are likely to be the mid- to long-term solution for mass domestic transit, particularly linking to intercontinental airport hubs for leisure, work and shopping, especially in those countries with modern railway networks, such as China, Japan and the Middle East, but also across the high-speed networks of Europe.

Regarding World Heritage Sites already at risk from the sheer numbers of visitors, it has been suggested that charging a tourist levy for entry is one solution to limit the numbers, though critics have said this is elitist.

The Future of Travel – Impacts and Implications

It is uncertain how far climate change will impact destinations over the next 20 years, but it is highly likely that we will start to see the effects of a warming world in this time frame, especially in those destinations that already experience extreme weather, such as at the equator and the poles (as well as the Caribbean, the Mediterranean and Australia), where particularly water scarcity will impact on the tourism industry.

Companies will increasingly be accountable for their environmental and social impact, and demonstrate how close they come to providing a ‘net positive impact’ in the destination.

The Future of the Company – Options and Possibilities

There is little that is guaranteed but change is certain. In the words of Lawrence Bloom, the co-founder of B.e Energy (a triple bottom line energy company), we are no longer in an age of change but in a change of age. The world faces three converging crises – economic, environmental and social – that require urgent and visionary action. Behind these crises are the failure of a worldview based on the single-minded pursuit of growth and the failure to work collaboratively to ensure that benefits are shared widely.

In the next decade, we will certainly see the effects of our failure to proactively address challenges such as inequality, the regulation of financial markets and youth unemployment. The effects of our failure to make capitalism inclusive will become apparent: we have a generation of young people with uncertain prospects and we face rising inequality with a rising share going to the wealthy even as our wages stagnate. The corporation will be increasingly associated with these problems due to its status as the place where much of the distribution of the benefits of capitalism take place.

We have already started to see the effects of climate change and business has started to sit up and take notice. How will we react and will we be able to turn the ship around? The answer to this question largely depends on the readiness of the corporate sector to support progressive political solutions. It is becoming patently clear that exhausting the planet’s resources is not an option – a growing number of politicians and business leaders recognize we cannot burn our fossil fuel reserves without destroying the world as we know it.

Not all is grim; in the next decade we will witness the continued rise of a new generation of leaders pushing for responsible business, broader recognition of the need for gender and racial diversity in boardrooms and C-suites, and the shift of power from the global north to south and from west to east. Companies from emerging economies will certainly take on a key role in the global economy. They will bring with them different models of governance which might be more able to respond to changing conditions, although they will also introduce new challenges. Finally, the line between public and private will continue to blur. There will be mounting pressure from civil society and the general public for sustainability in business and for corporations to take responsibility for the impacts generated by their value chains and off-shore operations. The reordering of transnational legal and political frameworks will offer us the opportunity to revision the respective roles of the State, the corporation and civil society. Concerted effort is needed to nudge the process in the direction of democracy and broad-based participation.

On our current path, another crash of the financial markets is highly likely. We have not addressed the root causes of the 2008 crisis and momentum for a significant overhaul of the markets has slowed to a crawl. Will the erosion of trust in business caused by the cyclical boom-and-bust nature of markets have an impact on policy-making? It’s hard to say.

The relative power of stakeholders within companies is similarly uncertain: will employees regain their voice? Will responsible investors play a more important role in influencing companies?

There are several events that could occur at the world stage that would have a profound impact on the global economy: another global energy crisis, the eclipse of Western economies by emerging economies, and the dissolution of the European Union.

The overarching uncertainties are whether we will see a rebalancing of power between different stakeholders, whether big business and key interested parties will lead or resist a rebalancing of influence, and how big a crisis is needed to jar us from our current trajectory. The risk is that entrenched interests that benefit from the current state of play will thwart reforms that threaten to limit their influence.

The Future of the Company – Impacts and Implications

Tailored solutions will be needed to respond to the unique characteristics of each region. For example, the continental European, Chinese, Japanese and Anglo-American economics and business models are each very different. Germany is characterized by a small number (less than 700) publicly listed companies with worker representation on company boards, whereas mandatory board-level employee representation would be a controversial proposition in the UK or the US. The EU will be forced to confront and reconcile these types of discrepancies in the corporate governance models of its Member States as it asserts an increasingly active role in company law, which has traditionally been under the purview of national governments.

Outside of the EU, we need to bring Asia, the Middle East and Africa into the discussion of sustainability, workers’ rights and human rights more generally. This will require thoughtful balancing of the local context with international standards. In the context of human rights, the UN Guiding Principles on Business and Human Rights outline the responsibilities of States to enforce the principles of international human rights law and of companies to respect those principles. But more work is needed to translate the framework into context- and industry-specific guidelines. It is in the implementation of general principles and the reconciliation of potentially contradictory rights that compromises will be most needed.

If this process is successful, we may see a gradual reduction in inequality leading to less social unrest and less partisan politics. We may also see an increasingly prominent role for business in developing both soft and hard law in a transparent way, acting individually and in concert through more progressive collaborative initiatives than the current trade and industry associations that dominate policy circles in Brussels, Washington and London.

We need a new vision for the role of business in society. Part of the reason why the focus on maximizing shareholder value and short-term profits has captured business for so long is due to the failure to create consensus around an alternative conception of the purpose of the corporation. A model of corporate governance narrowly focused on maximizing shareholder value in the short-term is unbalanced and self-destructive. The paradigm that will rise to replace the current one will need to have a more holistic understanding of profit as one indicator of the long-term health of the organization, amongst others. The profit-making motive will sit comfortably alongside a consideration of a broader responsibility to the interests of society.

This new paradigm must be translated into the existing framework of incentives and regulations for corporate governance and accountability. It needs to be reflected in market mechanisms, in particular in the way that financial markets interact and influence companies. The role of shareholders in corporate governance will have to be rethought in order to protect their role in ensuring management accountability, whilst freeing companies from the imperative to maximise the stock price as at all costs.

In order to achieve transparency and accountability, companies will need to provide an accurate accounting of their environmental and social impacts, through required disclosure and through increased pressure for meaningful information from consumers. Boards of directors will also need to revise their decision-making process to consider the effect of the company on the environment and society. Companies should be expected, encouraged and even required to develop long-term plans charting their way towards environmental and economic sustainability. It will be necessary to devise holistic measures for measuring corporate success in the long-term, reflecting their ability to create value in a responsible manner. These metrics should be reflected in incentives for corporate executives as well as for institutional investors. We need to consider whether the current level of public investment in research and development is sufficient and properly allocated to achieve transformative change. Public-private partnerships, while not without flaws, are one path to support and stimulate green growth.

At some point, we will be forced to acknowledge that the current approach to governing companies is broken. Perhaps after the next financial crisis, but hopefully sooner. Certainly as we are forced to respond to climate change, which cannot be addressed by governments alone without the support and investment of business.

The Future of Water – The Global Challenge

Climate change, population growth and increased urbanization pose great challenges to the provision of water for human use. Since 1950 cities have increased their water usage fivefold, not only through population growth, but considerably through increased per capita demand.  Currently half of the world’s cities with more than 100,000 in habitants are situated in areas experiencing water scarcity[1].  To date neither governments nor businesses have done enough to prepare for this. Collectively we did not recognize the macro trends soon enough and so opportunities to counter water scarcity have been lost, infrastructure investments have been inadequate, and climate change adaption measures too local and often only reactive.

At the same time as access to water decreases, world energy consumption is projected to grow by 56% between 2010 and 2040. This matters because approximately 90% of global power generation is water intensive so a country’s energy mix has fundamental implications for its water industry. Water security has therefore become one of the most tangible and fastest growing social and economic challenges faced today.

So, how can we meet the water needs of the future? Will it be possible to provide equitable access to water and sanitation services when by 2030 the world will face a 40% global shortfall between forecast demand and available supply?[2] Can we make the water cycle respond to the challenges of climate change and energy need?  How can we do more with less water?

[1] Brian D. Richter, David Abell, Emily Bacha, Kate Brauman, Stavros Calos, Alex Cohn, Carlos Disla, Sarah Friedlander O’Brien, David Hodges, Scott Kaiser, Maria Loughran, Christina Mestre, Melissa Reardon, Emma Siegfried. Tapped out: how can cities secure their water future? Water Policy. 2013;(15):335–63
[2] World Economic Forum 2014

The Future of Water – Options and Possibilities

The UN has sagely noted that “water is the primary medium through which climate change impacts will be felt by humans, society and the environment” and accordingly climate change will necessitate improvements in water resilience systems in cities across the globe. Increasingly they will have to focus on local water sourcing, reuse and recycling in order to sustain their ever-expanding population. There are multiple ways in which efficiency can be improved not least through significant investments in green infrastructure, the adaption of smart technology and widespread public education which will help to manage water demand through a broader understanding about its natural process. Water is a key contributor to life. We need to be constantly reminding ourselves of this and take action.

Many countries are currently working to maintain and improve the quality of their sources.  About 96% of the earth’s total water supply is found in oceans and there is broad agreement that extensive use of desalination will be required to meet the needs of growing world population.  Worldwide desalination plants are producing over 323 million cubic metres of fresh water per day, however energy costs are currently the principal barrier to its greater use. The State of Singapore has innovative water technology, aiming, despite its size and population density, to become fully self-sufficient by 2061.  Plans include tripling its desalinated water supply by 2030, the large-scale collection of rainwater, and the collection of recycled water which, as well as the standard procedures, uses micro filtration processes, reverse osmosis and UV treatment to deliver potable water to its citizens. In short they are converting their city into a catchment and focusing on source diversity.

Elsewhere efficiencies will be improved by the use of intelligent robots, which will play a greater role in the inspection of infrastructure.  New materials, such as graphene, that are lighter, stronger, smarter and greener will also become more popular replacing traditional materials such as stainless steel pipes.

Growing concern for the environment and for public health means that water companies will be held to greater account for their environmental impact and water quality. A stronger emphasis on green infrastructure will support a trend for companies to transform from providing base utilities to creating a system of amenities that support the water cycle. An example of this can be found at the Illinois Institute of Technology. Rain gardens have been reutilized as communal meeting spaces, through-ways turned in to permeable walkways and three acres of new native plant communities with underground cisterns collect rainwater for future non potable reuse. Once all the changes are implemented the IIT predicts a 70 – 80% reduction of run-off into Chicago’s sewer system while making the collected non-potable water available for irrigation. Expect this repurposing of public spaces for multi-functionality for both amenity and wider sustainability purposes to be widely adopted.

Alongside making improvements to the infrastructure, there is a pressing need to do more with less water. Smart technology and big data will help. Changing public behavior is a huge challenge however.  Although there is widespread understanding that rising consumption of raw materials is both intensifying resource scarcity and increasing competition, most people, certainly in the developed world, live materialistic lifestyles resulting in high levels of waste.  In Australia for example, on average around 20 million tonnes of waste per year is thrown away at a value of AUD10.5 bn. Digital lifestyles can increasingly link consumer behavior to consumption and growing connectivity, utilizing the Internet of Things, will mean that it will be possible to monitor the consumption and cost of water in real time allowing consumers to understand their impacts and take action.

Data analytics can help build understanding on how to use the water cycle to respond to the challenges of climate change. It can also lead to increased scrutiny of water utilities and a better understanding of cost. Companies will therefore be able to integrate the true cost of water into their decision-making. In addition the availability of data provides an opportunity to educate customers about consumption. Publicity campaigns and a growing sense of urgency will nudge consumers to reduce consumption and should be used in partnership with economic levers that recognize the true value of water.

Growing populations and changes in diet mean that we need to produce more food. Water is a fundamental part of this process. In Australia, for example, the agricultural sector accounts for around 65% of total water consumption.  This could be greatly reduced if we could change consumer behaviour. It is estimated that Australians throw away AUD5.3bn of food waste every year. This is simultaneously wastewater. There is a real need to change this approach and developments in this sector will continue to have tangible knock on effects for the water supply industry and the natural environment from which this water is sourced.

Science will also have a key role in reducing the amount of water we use. Nano and biotechnology is a potential game-changer for the water industry, and can enable breakthrough products and technologies to tackle pressing global challenges such as reducing environmental footprints, using less and cleaner energy and decreasing water usage and waste generation. For example microorganisms are now being used to treat water that has been contaminated by hazardous materials. The global market for nanostructured product used in water treatment was worth an estimated USD1.4bn in 2010 and is expected to rise to USD2.1bn in 2015.[1]  Initial success in this area has also raised the possibility of the utility as a self-healing ecosystem.

Greater efficiency is the driving force for manufacturing companies where energy and water can be as much as 50% of the total manufacturing cost.  In the future expect more green manufacturing and increased co-operation when companies forge alliances across traditional boundaries, for example to share common costs. In the water industry this will manifest itself in knowledge sharing and contributions to joint research and development across catchment boundaries.  Through using resources more efficiently countries could also become more active trading partners; this would allow for more equal water redistribution amongst users. This could include a water balance concept similar to carbon emissions reduction strategies where water saved in one country offsets additional water use in another.

Looking ahead, users are likely to have to pay for the real cost of infrastructure. One short-term option is the financial recycling of assets and capital where old assets are sold or leased to fund the new. However, in the longer-term we will have to pay the true value for key resources. This shift could also lead to the greater application of the circular economy, which will help stretch resources through end of life recycling and reuse. More awareness will lead to increased scrutiny of water utilities and pricing of services as the widespread availability of data provides the opportunity to educate customers about consumption and managing resource use.  Looking through an international lens, water trading would allow for the efficient redistribution of water amongst users, so countries could become active trading partners. As the amount of water used in agriculture in arid regions is two to three times higher than in rain fed regions water trade could help save water on a global scale.

Once efficiencies and improvements are made, consideration should be given to the most cost effective way to provide access to basic services.  The fixed nature of water supply infrastructure and its history as an essential government supplied service gives rise to natural monopolies within supply areas. Governments need to ensure the pricing policy is appropriate to balance the essential need for water, the impacts on consumers (particularly those on lower incomes) and the requirements of the suppliers to remain financially viable.  To do this there should be better integration between urban water planning and urban development planning with considerations on limitation to green-field development.

Recognizing innovation opportunities for the future more and more companies are tapping into the public’s intellectual capital by crowdsourcing product ideas and solutions.  In exchange they are giving creative consumers a direct say in what gets developed, designed or manufactured. Crowd-funding added at around 270,000 jobs and injected more than US$65bn into the global economy by the end of 2014 with an expected industry growth of 92%.

[1] . Nanotechnology Now. Nanotechnology in Water Treatment. 2012; Available from: http://www.nanotech-now.com/news.cgi?story_id=45894

The Future of Water – Proposed Way Forward

Over the next ten years our waterways and other water sources will continue to suffer from over-extraction. This will continue to compromise the quality of the environment and the organisms it supports. In particular mining and other activities will continue to move into our water supply catchments affecting water quality and altering inflows. This will mean that we may be obliged to move water long distances in times of drought to services existing cities. In turn this could lead to increased GHG emissions at the very time when we are trying to reduce these.

We need to change this trajectory.   In doing so it is important that we reconnect ourselves with water in its pure elemental form. We should all be able to enjoy access to clean water, not just for drinking, but also for recreation and connection to nature. Putting water at the centre of the urban design process and re designing our cities and towns to respond positively to water is fundamental to ensuring a better understanding of the water cycle.  We need to develop better Green infrastructures – the networks of green and blue spaces such as parks, agriculture, woods, rivers and ponds in and around cities systems – that replicate nature and enable communities to connect with water.  The benefits include the reduction of flood risk, improved health and well being as well as providing a habitat for wildlife. Extensive green networks can be formed over time to create encompassing city ecosystems that can support the sustainable movement of people, rebuild biodiversity and provide substantial climate change adaption and resilience.

The focus should extend to solutions that do more with less: irrigation efficiency, automated farming techniques and demand management in our cities.  Smart infrastructure will help responding intelligently to changes in its environment to improve performance. Smart water networks could save the industry USD12.5bn a year.  In Israel, data analytic company TaKaDu takes information supplied by sensors and meters dotted around a water company’s supply network to build a sophisticated picture of how the network is performing.  It can spot anomalies in its behaviour from a small leak to a burst water main.

We should also start to re-think our traditional approach to drainage.  Working with natural site conditions for example, water, wastewater and storm water could be combined into one cycle. The AJ Lewis Centre for Environmental Studies ecologically treats and recycles wastewater within its buildings, integrating processes of wetland ecosystems with conventional procedures and in so doing recycling wastewater into reusable grey water.  While conventionally supplied water is used for drinking and hand washing, the recycled non-potable water is used in the Centre’s toilets and for landscape irrigation and recharging the wetland pond. Others should and are following suit.

A multitude of new tools are available to help us.  Alongside smart technology there are new biodegradable materials made from natural fibres that can provide greater resilience at less energy and lower cost. Beyond this, innovations will transform wastewater into a resource for energy generation and humidity into a source of drinking water.  We can see the beginnings of this already; consider, for example, the Israeli company, Water Gen, which has developed a device for extracting drinking water from air. Other advances including fog catchers, thick mesh nets that collect the water contained in fog, will soon be more widely adopted.[1]

We need increased investment in basic water and sanitation services both in new and the renewal of existing services.  Water treatment can come at a high price. The OECD has estimated that around USD50 trillion would be needed worldwide in the period to 2030 to satisfy the global demand for infrastructure[2]. However, accessing funding is an ever-present challenge.  In the US alone, if current trends continue, the investment needed by 2040 will amount to USD195bn and the funding gap will be USD144bn[3].  While most infrastructure investments are local, the sources of finance are increasingly global.

Beyond everything we must improve public understanding about the value of water and the services it provides. Globally public opinion still varies on the issue of climate change.  Better engagement with customers including education and information will have a large effect on calls to action around water. Education is fundamental to help the public to accept the need to reduce overall water use and to increase the use of wastewater for potable purposes. In particular city dwellers must learn to conserve more or utilize different sources of water such as storm water to provide for their needs, allowing potable water to be freed up to feed a growing population. Small adaptions by multiple individuals will make a difference.

[1] National Geographic. Fog Catchers Bring Water to Parched Villages. 2009; Available from: http://news.nationalgeographic.com/news/2009/07/090709-fog-catchers-peru-water-missions.html
[2] OECD. Infrastructure to 2030: Telecom, Land Transport, Water and Electricity. 2006; Available from: http://www.keepeek.com/Digital-AssetManagement/oecd/economics/infrastructure-to-2030_9789264023994-en#page4
[3] American Society of Civil Engineers. Failure to act: the economic impact of current investment trends in water and wastewater treatment infrastructure. 2011; Available from: http://www.asce.org/uploadedfiles/infrastructure/failure_to_act/asce%20water%20report%20final.pdf

The Future of Water – Impacts and Implications

In the future it is clear urban water utility companies must prepare to operate in a world which is expected to be utterly different from the one that we are experiencing today. It is necessary to acknowledge and prepare for this.

We know that there is a growing urban population; we know that the impact climate change is now taking effect and that the volatility in water supply can only be partially mitigated by improved efficiency.  We have yet to collectively decide how to address the problem.

Water is inter-twined with everything we do; energy, food, health and wellbeing, manufacturing are all dependent on its availability. At the very least we need to start a public conversation about its real role in our lives. We need to understand how people currently value water and then work with them so they understand its true value and all the services it provides.

Providing access to water is one of the greatest challenges we face and one of the defining moral and cultural issues facing the planet. To address it governments must develop national water strategies, businesses must consider the impact of water in their products, and individuals must change their behavior.  There should be investment in large scale recycling schemes, green infrastructure should have priority when planning new developments and renovating old: All this at a time of population growth and climate change. No one says it will be easy, but it is most certainly possible.