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Economics of water

The Reminder is making its archives back to 2003 available on our website. Please note that, due to technical limitations, archive articles are presented without the usual formatting.

The Reminder is making its archives back to 2003 available on our website. Please note that, due to technical limitations, archive articles are presented without the usual formatting.

Water is a more important resource to the people of Alberta than oil or gas, and it's becoming more crucial all the time." Peter Lougheed, Calgary Herald, July 21, 2004. They say that whiskey is for drinking and that water is for fighting over. Leaving aside the whiskey drinking for now, good public policy and an informed public should be able to prevent the fighting and, in addition, ensure the long-term viability of the water supply. Developing good public policy and informing the public, however, are not easy tasks and they are made more difficult in this case by the fact that water is often taken for granted in Canada. We need water to live. We also need water to produce our food and to support the complex ecological systems that enable life including human life to exist. Despite this, and notwithstanding sporadic reminders like a water quality scare or a severe drought, most of us think of water as something that comes out of the tap, a threat (in the form of rain) to summer softball games, or the stuff in the lake that is nice to look at and fun to play in rather than as an essential ingredient of life on the planet. In addition, we have traditionally used water as something in which to dump sewage and deadly industrial by-products. Although there have been significant improvements in these areas, water remains in many ways the Rodney Dangerfield of natural resources: it doesn't get any respect. Indeed, we still use water to wash away a multitude of sins and most of us do not think twice as it runs down the drain. Not only is water often taken for granted and treated with less respect than it deserves, it does not receive full credit for its role in the economy. Given that the general importance of water is not a hot topic of discussion, it is even less likely that the economic importance of water is going to come up at the dinner table or while sitting by the lake on a long weekend. Behind the scenes, water plays a fundamental role in both our current and future economic success. Abundant and clean water is, for example, critical to the urban growth that has been identified as an engine of success in the knowledge economy and global competition for skilled labour. A city without enough water or with poor water quality is a city in big trouble. See 'A' P.# Con't from P.# A secure supply of clean water is central to primary agriculture and the food and beverage sector. Ask any prairie farmer and he will tell you that it just doesn't fall from the sky on demand. And keep in mind the amount of water used to make, or contained in, food products like beer, soup, sauces, canned vegetables, bagged ice and so on. When you consider all the people that work in primary agriculture, in the agri-food sector, and in related industries, you start to get some sense of the economic importance of water. Add to this the fact that water is also critical to power generation, all sorts of manufacturing processes, tourism and recreation, and oil and gas extraction, and it becomes clear that water is, like skilled labour, capital, raw materials, markets, and ingenuity, a key factor in our economic success. Without water, the economy would come to a standstill. It is also important to note the connection between future economic growth and an adequate supply of water. Urban growth, increased manufacturing activity such increased output and new plants, and ongoing natural resources extraction and processing all presuppose an adequate supply of water. It follows that, if the water runs dry or there is not enough to go around, it is not just farmers and ranchers that are in trouble we all are. We simply cannot afford to waste water and, in turn, there is a strong economic case to be made for using water as efficiently as possible and for investing in the long-term sustainability of our watersheds. On the bright side, Canada has a lot of clean fresh water relative to other countries. Canadians, however, also use a lot of water second only to the U.S. on a per capita basis and four times as much as the average European. Given this, the points to hammer home are that our water supply is limited, often not where it is needed (water is plentiful in wetter regions and limited in drier regions), difficult, expensive and damaging to watersheds to move around, and threatened by a range of factors including climate change (natural or manmade), overuse, contamination, upstream and downstream needs, and general mismanagement. Among this complex set of factors several things are particularly clear: 1 - water is a precious resource of critical importance to human life, the environment, and the economy; 2 - water is a finite resource that must be carefully managed with input from a range of stakeholders including governments, users, researchers, and the public; and 3 - growing demand for this finite resource, combined with limited and problematic options for increasing supply, highlights the value of public and private policies that encourage or require water conservation. There is, in other words, a strong ecological and economic case for aggressive water conservation. If we ignore water conservation, we risk overstressing the water supply itself and we risk undermining our economic prosperity if there is not enough water to go around because it is being wasted in other areas. There are many factors to consider as we wrestle with the challenges of growing demand for a finite supply of water and among these is the need for, and value of, water conservation. If we don't figure out ways to use water more efficiently, fights over water will become more common.8/17/2004

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