Will Sarni (center), director and practice leader of water strategy at Deloitte, at Fortune's Brainstorm E conference
Stuart Isett/Fortune Brainstorm E
By Beth Kowitt
May 17, 2016

Stop calling California’s ongoing water shortage a drought.

It may seem counterintuitive, but that’s the best way to get regulators and consumers to rethink the value of water, says Will Sarni, director and practice leader of water strategy at Deloitte.

“As long as the public sector continues to refer to this as the drought, public policy is not going to change, because everyone is going to wait for a good rain,” he said at Fortune’s Brainstorm E conference on Tuesday in Carlsbad, Calif. “That’s not going to happen.”

He added that California is over-allocated with respect to water, and that’s not a short-term problem. “How do you move the public sector to think strategically about a resource no one can live without?” he posited.

At the crux of the issue—we don’t value water, or at least there is a disconnect between its price and value. That’s in part why so much water is wasted in the U.S. Only 4% of water in the U.S. is reused, versus between 90% to 100% in Israel. About a third of our drinking water also gets lost through leaky pipes.

“The problem is we have taught everybody that water is free,” said Robin Gilthorpe, CEO of WaterSmart Software. He added that if it were fully valued, people would make more rational choices. By failing to do so, there’s a big cost, and especially an environmental one. He noted that 20% of California’s energy use goes toward water.

Managing water is only going to get more complex, in large part because of the impact of extreme weather. Michael Sullivan, global leader of IBM Smarter Water, noted that part of the problem is the fragmentation of the industry—there are some 55,000 utilities in the U.S.

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