This is Dana Perkins and you're listening to Switched on, the podcast brought to you by BNF. Today, we're here to talk about the existing and emerging technology solutions to address water stress. According to the Intergovernmental Panel on Climate Change, anywhere between one point five to two point five billion people live in areas exposed to water stress today. This is forecasted to rise to three billion by twenty fifty, and that's only if warming is limited to two degrees c by that point. Humans are made up of roughly sixty percent water, so to say that its essential would be an understatement. And we live on an increasingly thirsty planet, not just due to population growth and demands from agriculture, but also owing to increasing demand from industry and data centers. Yes, the same data centers that are needed to power AI technology. So where do we get more water? From energy intensive desalination plants to reducing water loss, to increasing water reuse and recycling. We'll get into the technology side of this essential building block for life on this planet. I'm joined today by b and EF technology and innovation analyst Stephanie Diaz, who shares findings from her recently released research note titled tech Radar Water supply use and Treatment. Bn EF clients will be able to find this at BNOF go on the Bloomberg terminal or at BNF dot com. All right, let's get to talking about water. Stephanie, thank you for joining today.

This is Dana Perkins and you're listening to Switched on, the podcast brought to you by BNF. Today, we're here to talk about the existing and emerging technology solutions to address water stress. According to the Intergovernmental Panel on Climate Change, anywhere between one point five to two point five billion people live in areas exposed to water stress today. This is forecasted to rise to three billion by twenty fifty, and that's only if warming is limited to two degrees c by that point. Humans are made up of roughly sixty percent water, so to say that its essential would be an understatement. And we live on an increasingly thirsty planet, not just due to population growth and demands from agriculture, but also owing to increasing demand from industry and data centers. Yes, the same data centers that are needed to power AI technology. So where do we get more water? From energy intensive desalination plants to reducing water loss, to increasing water reuse and recycling. We'll get into the technology side of this essential building block for life on this planet. I'm joined today by b and EF technology and innovation analyst Stephanie Diaz, who shares findings from her recently released research note titled tech Radar Water supply use and Treatment. Bn EF clients will be able to find this at BNOF go on the Bloomberg terminal or at BNF dot com. All right, let's get to talking about water. Stephanie, thank you for joining today.

Thanks for having me, Dana.

Thanks for having me, Dana.

So we're here to talk about water today, and we know that this has so many important applications in addition to what we drink and agriculture. But actually, as we so often talk about in the show, the energy transition is actually quite dependent upon water. We'll get to the demand side part of it momentarily, but as we tend to kick off many of these shows, let's start with some definitions and then also as we think about the fact that with climate change there is disruption to traditional precipitation patterns, what is the definition of water stress?

So we're here to talk about water today, and we know that this has so many important applications in addition to what we drink and agriculture. But actually, as we so often talk about in the show, the energy transition is actually quite dependent upon water. We'll get to the demand side part of it momentarily, but as we tend to kick off many of these shows, let's start with some definitions and then also as we think about the fact that with climate change there is disruption to traditional precipitation patterns, what is the definition of water stress?

Sure, but let's start by actually talking about water itself, right, because water is really ubiquitous in everyday life. It's really an amazing thing for a modern miracle that we can just go to the tap and turn on our water. But really what that ends up meaning in practice is that we use an estimated four trillion cubic meters of water annually. And most of this is coming from things like rainfall, snowmells, river runoff, and we collect it from surface water and groundwater, so think lakes, rivers, and aquifers. These together account for ninety two percent of human water use, and all of this water gets used in a couple of different ways. About three quarters of that goes into the agriculture sector, so think crops, livestock, aquaculture, and then the remainder gets used for industrial or municipal purposes. So when we talk about water stress, what we're actually talking about is does the water demand outpace the supply. This is a really localized definition because water is a really regional thing. But what you should think about is between the water that gets used for human purposes, the water that needs to be there to in order to replenish rivers, in order to you know, water forests, be used by the environment. All of that, does that water demand surpass the amount of water that is available in that area for things like precipitation, groundwater, all of that. We are increasingly seeing that water stress is becoming a pertinent issue around the world. So today about one point five to two point five billion people live in areas exposed to water scarcity, and under a two degrees celsius scenario of global warming that's expected to rise to approximately three billion people by twenty fifty, demand for fresh water could be up to forty percent greater than supply by twenty thirty, according to the Global Commission on the Economics of Water.

Sure, but let's start by actually talking about water itself, right, because water is really ubiquitous in everyday life. It's really an amazing thing for a modern miracle that we can just go to the tap and turn on our water. But really what that ends up meaning in practice is that we use an estimated four trillion cubic meters of water annually. And most of this is coming from things like rainfall, snowmells, river runoff, and we collect it from surface water and groundwater, so think lakes, rivers, and aquifers. These together account for ninety two percent of human water use, and all of this water gets used in a couple of different ways. About three quarters of that goes into the agriculture sector, so think crops, livestock, aquaculture, and then the remainder gets used for industrial or municipal purposes. So when we talk about water stress, what we're actually talking about is does the water demand outpace the supply. This is a really localized definition because water is a really regional thing. But what you should think about is between the water that gets used for human purposes, the water that needs to be there to in order to replenish rivers, in order to you know, water forests, be used by the environment. All of that, does that water demand surpass the amount of water that is available in that area for things like precipitation, groundwater, all of that. We are increasingly seeing that water stress is becoming a pertinent issue around the world. So today about one point five to two point five billion people live in areas exposed to water scarcity, and under a two degrees celsius scenario of global warming that's expected to rise to approximately three billion people by twenty fifty, demand for fresh water could be up to forty percent greater than supply by twenty thirty, according to the Global Commission on the Economics of Water.

So now let's pivot to the demand side part of things, which has to do with this wider question of you know, water for a lot of the end uses that you know, we do traditionally talk about here at BNF, Can you talk about some of the sectors that maybe many we've thought of or some that we haven't thought of, that are really heavily dependent upon this natural resource.

So now let's pivot to the demand side part of things, which has to do with this wider question of you know, water for a lot of the end uses that you know, we do traditionally talk about here at BNF, Can you talk about some of the sectors that maybe many we've thought of or some that we haven't thought of, that are really heavily dependent upon this natural resource.

Yeah, I mean there are so many examples. Let's talk agriculture. It's kind of a given that water is important for agriculture, but we often don't think about this implicit water trade that is happening in crop production. So, just to give an example, Fondamonte is an agriculture company and it grows alfalfa in the US state of Arizona, and that alfalfa is then harvested and shipped back to Saudi Arabia to feed cattle there. The company turned to Arizona because of water scarcity issues in Saudi Arabia and the ability to grow you around in Arizona, but Arizona itself is a hot desert state. Water also has implications for the energy sector. French company EDF had to reduce output of several of its nuclear power plants in twenty twenty two as heat waves made the river water that's usually used to cool those nuclear power plants too warm. They had to reduce their output as a result. It has impacts on mining because water is used in querying and milling, and the amount of water used for those processes can put stress on local water supplies. In Mexico, Group of Mexicos, Buena Vista del Cobre Mine dealt with protests in June twenty twenty four as the company was issued permits entitling it to more than fifty billion liters of water annually, which is fifty seven percent of that local watershed's volume, even though that area is experiencing a regional drought. You have examples across you know, thermal power plants that use up to three thousand liters of water per megawat hour for cooling the steel industry consumes up to one hundred and seventy five liters of water per ton of steel produce. Water ends up being used throughout so many of the different industries that we cover here at BENF, So.

Yeah, I mean there are so many examples. Let's talk agriculture. It's kind of a given that water is important for agriculture, but we often don't think about this implicit water trade that is happening in crop production. So, just to give an example, Fondamonte is an agriculture company and it grows alfalfa in the US state of Arizona, and that alfalfa is then harvested and shipped back to Saudi Arabia to feed cattle there. The company turned to Arizona because of water scarcity issues in Saudi Arabia and the ability to grow you around in Arizona, but Arizona itself is a hot desert state. Water also has implications for the energy sector. French company EDF had to reduce output of several of its nuclear power plants in twenty twenty two as heat waves made the river water that's usually used to cool those nuclear power plants too warm. They had to reduce their output as a result. It has impacts on mining because water is used in querying and milling, and the amount of water used for those processes can put stress on local water supplies. In Mexico, Group of Mexicos, Buena Vista del Cobre Mine dealt with protests in June twenty twenty four as the company was issued permits entitling it to more than fifty billion liters of water annually, which is fifty seven percent of that local watershed's volume, even though that area is experiencing a regional drought. You have examples across you know, thermal power plants that use up to three thousand liters of water per megawat hour for cooling the steel industry consumes up to one hundred and seventy five liters of water per ton of steel produce. Water ends up being used throughout so many of the different industries that we cover here at BENF, So.

We could go in so many different directions when we're thinking about end uses and demand side for water. But let's focus in on one that has been incredibly buzzy lately, and that is data centers and the growth of data centers in some respects to this rise in AI applications that are really leading to a lot more demand for electricity in order to keep these data centers cool. Can you talk about how water is connected to this burgeoning space right now?

We could go in so many different directions when we're thinking about end uses and demand side for water. But let's focus in on one that has been incredibly buzzy lately, and that is data centers and the growth of data centers in some respects to this rise in AI applications that are really leading to a lot more demand for electricity in order to keep these data centers cool. Can you talk about how water is connected to this burgeoning space right now?

Data centers and AI are actually surprisingly dependent on water in two ways. So let's talk about the first one, which is cooling. So think of your laptop. When you run it for a long period of time, it gets warm, right. Data centers do the same thing. They get warm over time, and water based cooling systems are often used in order to take that heat away from the data centers and keep them cool. This is a really energy efficient way to do this, but it does mean that a lot of water can get consumed in Virginia's Data Center Alley, which is just outside of Washington, DC. Companies like Amazon and Microsoft used one point nine billion gallons of water in twenty twenty three, a sixty four percent increase since twenty nineteen. The second way in which data centers and AI are dependent on water is through semiconductors themselves. So the chips that go into these data centers. In order to create these chips, you need really pure water, like ultra pure water. This is water that is so pure that it would actually kill us humans if we drink it. But this is the kind of extremely pure water that is necessary for the chips because they're working on the scale of nanometers right. In order to produce these sort of chips, you need access to really clean water, and as a result, they end up consuming a lot of water. According to the World Economic Forum, forty percent of semiconductor manufacturing facilities are in watersheds expected to face severe water stress between twenty thirty and twenty forty. And now I want you to add to this another twenty four to forty percent of facilities that are currently under constructed, and then another forty percent of facilities that are currently planned and underway that will also be located in severe water stress areas. So when taken altogether, you can really see how data centers ai big technique to be thinking more about their water usage. A great example of this is how in Chile recently a court partially reversed approval for a two hundred million dollars Google data center projects, citing that the company needed to go back and reconsider its water use. This is after the data center had already announced that it was going to switch from water based cooling to the less water intensive want more energy intensive air based cooling, and we've seen companies like Microsoft and AWS commit to being water positive and aiming to replenish more water than they use by twenty thirty.

Data centers and AI are actually surprisingly dependent on water in two ways. So let's talk about the first one, which is cooling. So think of your laptop. When you run it for a long period of time, it gets warm, right. Data centers do the same thing. They get warm over time, and water based cooling systems are often used in order to take that heat away from the data centers and keep them cool. This is a really energy efficient way to do this, but it does mean that a lot of water can get consumed in Virginia's Data Center Alley, which is just outside of Washington, DC. Companies like Amazon and Microsoft used one point nine billion gallons of water in twenty twenty three, a sixty four percent increase since twenty nineteen. The second way in which data centers and AI are dependent on water is through semiconductors themselves. So the chips that go into these data centers. In order to create these chips, you need really pure water, like ultra pure water. This is water that is so pure that it would actually kill us humans if we drink it. But this is the kind of extremely pure water that is necessary for the chips because they're working on the scale of nanometers right. In order to produce these sort of chips, you need access to really clean water, and as a result, they end up consuming a lot of water. According to the World Economic Forum, forty percent of semiconductor manufacturing facilities are in watersheds expected to face severe water stress between twenty thirty and twenty forty. And now I want you to add to this another twenty four to forty percent of facilities that are currently under constructed, and then another forty percent of facilities that are currently planned and underway that will also be located in severe water stress areas. So when taken altogether, you can really see how data centers ai big technique to be thinking more about their water usage. A great example of this is how in Chile recently a court partially reversed approval for a two hundred million dollars Google data center projects, citing that the company needed to go back and reconsider its water use. This is after the data center had already announced that it was going to switch from water based cooling to the less water intensive want more energy intensive air based cooling, and we've seen companies like Microsoft and AWS commit to being water positive and aiming to replenish more water than they use by twenty thirty.

Now, I think a lot of people understand that water needs to be processed before it can be used, especially well depending upon where it came from. But can you just actually explain what ultra pure water is and why it's deadly for humans.

Now, I think a lot of people understand that water needs to be processed before it can be used, especially well depending upon where it came from. But can you just actually explain what ultra pure water is and why it's deadly for humans.

So water needs to be processed to the level of purity required for what people what it's being used for. So take humans. We need to drink clean water, right, but we actually don't need to drink perfectly pure water because there's actually useful stuff in water. Water contains minerals that are one of the ways we get them as part of like a nutritional basis. If you drink ultra pure water, it's too pure for our bodies and so then our red blood cells end up rupturing because the water wants to like even out the concentration.

So water needs to be processed to the level of purity required for what people what it's being used for. So take humans. We need to drink clean water, right, but we actually don't need to drink perfectly pure water because there's actually useful stuff in water. Water contains minerals that are one of the ways we get them as part of like a nutritional basis. If you drink ultra pure water, it's too pure for our bodies and so then our red blood cells end up rupturing because the water wants to like even out the concentration.

I know this is not related to the energy system, but I just I had to understand that. Okay. Another form of water, since we're using this term very colloquially, is salt water, and desalination is a technology that has been used in order to remove salt from water to make it to the level of purity that we can use it for other use cases. Can you talk about desalination whether or not that for regions that may be experiencing water stress, is desalination something that is becoming a more popular technology.

I know this is not related to the energy system, but I just I had to understand that. Okay. Another form of water, since we're using this term very colloquially, is salt water, and desalination is a technology that has been used in order to remove salt from water to make it to the level of purity that we can use it for other use cases. Can you talk about desalination whether or not that for regions that may be experiencing water stress, is desalination something that is becoming a more popular technology.

Desalination is currently responsible for producing about two percent of our global water global freshwater, that is, and while it's only two percent globally, in water stress regions like the Middle East, it is much higher than that. Saudi Arabia, for example, relies on desalination for seventy percent of its freshwater, and Kuwait relies on it for ninety percent of its fresh water. So desalination can play a massive rule in specific regions based on how localized that water stress is. Desalination itself is a really mature technology. We've been doing this for a long time now. There are currently about fifteen thousand existing facilities globally that produce ninety five million cubic meters of fresh water per day, but this is expected to grow over time. The International Energy Agency expects that energy demand for desalination is set to double by twenty thirty from twenty twenty three levels, reaching nearly four thousand Petta Rules of energy by the end of the decade. Just to give a sense of scale, that's roughly the energy consumption of Poland in twenty twenty three. So desalination is a mature technology and it is definitely widely used in some parts of the world, but not in all of the world.

Desalination is currently responsible for producing about two percent of our global water global freshwater, that is, and while it's only two percent globally, in water stress regions like the Middle East, it is much higher than that. Saudi Arabia, for example, relies on desalination for seventy percent of its freshwater, and Kuwait relies on it for ninety percent of its fresh water. So desalination can play a massive rule in specific regions based on how localized that water stress is. Desalination itself is a really mature technology. We've been doing this for a long time now. There are currently about fifteen thousand existing facilities globally that produce ninety five million cubic meters of fresh water per day, but this is expected to grow over time. The International Energy Agency expects that energy demand for desalination is set to double by twenty thirty from twenty twenty three levels, reaching nearly four thousand Petta Rules of energy by the end of the decade. Just to give a sense of scale, that's roughly the energy consumption of Poland in twenty twenty three. So desalination is a mature technology and it is definitely widely used in some parts of the world, but not in all of the world.

Are there innovations being made in the desalination space or is it just becoming more prevalent.

Are there innovations being made in the desalination space or is it just becoming more prevalent.

Technologies for desalination are getting better. We've seen, for example, that originally desalination was mostly done through multi stage flash and multi effect distillation, which are both thermal methods of removing salt fur water. Basically, the idea there is you take water salty water, you evaporate it, and the salt gets left behind, but the water becomes a gas. You collect the gas and then you condense it so that you have liquid water. Again. This is a really good way of creating clean water, but it's also really energy intensive, and so we saw the switch from these thermal methods to using reverse osmosis instead. Reverse osmosis accounts for more than two thirds of desalination capacity around the world today, and the idea behind reverse osmosis is that you have a semi permeable membrane and all that means is that this membrane lets water through but not salt. And so you push the salty water against this membrane and the water gets pushed through, but a lot of the salt stays behind. This is the most common method used today and partly because it requires less energy to produce that fresh water. But there are still new methods of desalination being explored, such as electrodialysis, capacitive deionization, and humidification dehumidification cycling. The idea behind these newer methods is that they're all looking for ways to lower the energy demand of desalination and turn could lower the cost of water production.

Technologies for desalination are getting better. We've seen, for example, that originally desalination was mostly done through multi stage flash and multi effect distillation, which are both thermal methods of removing salt fur water. Basically, the idea there is you take water salty water, you evaporate it, and the salt gets left behind, but the water becomes a gas. You collect the gas and then you condense it so that you have liquid water. Again. This is a really good way of creating clean water, but it's also really energy intensive, and so we saw the switch from these thermal methods to using reverse osmosis instead. Reverse osmosis accounts for more than two thirds of desalination capacity around the world today, and the idea behind reverse osmosis is that you have a semi permeable membrane and all that means is that this membrane lets water through but not salt. And so you push the salty water against this membrane and the water gets pushed through, but a lot of the salt stays behind. This is the most common method used today and partly because it requires less energy to produce that fresh water. But there are still new methods of desalination being explored, such as electrodialysis, capacitive deionization, and humidification dehumidification cycling. The idea behind these newer methods is that they're all looking for ways to lower the energy demand of desalination and turn could lower the cost of water production.

So I'm glad you brought that up. How much does it cost?

So I'm glad you brought that up. How much does it cost?

Yeah, so the cheapest desalinated water you can find in the world would be in Saudi Arabia, where you can get it at less than fifty cents per cubic meter. Everywhere else in the world has more expensive desalinated water than that, and it really depends on things like the maturity of the industry in that area, the salinity of the water that you're using in the first place. The saltier your feed water is, the harder it is to get the salt out, and therefore the more expensive it is. Things like the cost of energy and as well as the pre and post treatment required for that water depending on its use case.

Yeah, so the cheapest desalinated water you can find in the world would be in Saudi Arabia, where you can get it at less than fifty cents per cubic meter. Everywhere else in the world has more expensive desalinated water than that, and it really depends on things like the maturity of the industry in that area, the salinity of the water that you're using in the first place. The saltier your feed water is, the harder it is to get the salt out, and therefore the more expensive it is. Things like the cost of energy and as well as the pre and post treatment required for that water depending on its use case.

So you've just described this process of desalination, which I fully recognize is one complex into energy intensive and with that comes costs. So it's a application that is a you know, if you really need it and you have access to salt water, you're going to use this. But let's talk a bit about how people are currently getting water. And I'm thinking about parts of the world that are currently under water stress. So the state that I grew up in is California and produces a ton of food and also has a lot of periods of water stress in recent history, a lot of years that would be classified as droughts. And I know that this is not unique to California, but there's a lot of conversation about the water that is in dams and whether or not to release it at certain points in time. There was some water recently released. It was being held for agriculture for it later in the summer for August September, which is now no longer available. So water stress is coming to California potentially later this year. Is desalination something that's on the cards for that part of the world or other areas where there is water stress, or is this really somewhat limited use cases at least at this point in time because of how expensive and complex it is.

So you've just described this process of desalination, which I fully recognize is one complex into energy intensive and with that comes costs. So it's a application that is a you know, if you really need it and you have access to salt water, you're going to use this. But let's talk a bit about how people are currently getting water. And I'm thinking about parts of the world that are currently under water stress. So the state that I grew up in is California and produces a ton of food and also has a lot of periods of water stress in recent history, a lot of years that would be classified as droughts. And I know that this is not unique to California, but there's a lot of conversation about the water that is in dams and whether or not to release it at certain points in time. There was some water recently released. It was being held for agriculture for it later in the summer for August September, which is now no longer available. So water stress is coming to California potentially later this year. Is desalination something that's on the cards for that part of the world or other areas where there is water stress, or is this really somewhat limited use cases at least at this point in time because of how expensive and complex it is.

Descalination is definitely being considered by more parts of the world. California, for example, recently released a report on the future of desalination plants in the state. But you have to remember that and we're thinking about desalination, we're comparing it to the alternative, which oftentimes is water that is really really cheap and oftentimes free. So take for example, if you are a farmer that depends on groundwater, you have to pay for a well, you know, install a well that goes down into the ground, and pay for the pumps, but the water itself you might not be paying for. You might not be paying for water that you draw from a lake for example. So oftentimes one of the things that we talk about in desalination is we have to lower the cost of water if we want this technology to be more competitive, because we're competing against really cheap access to water in lots of parts of the world.

Descalination is definitely being considered by more parts of the world. California, for example, recently released a report on the future of desalination plants in the state. But you have to remember that and we're thinking about desalination, we're comparing it to the alternative, which oftentimes is water that is really really cheap and oftentimes free. So take for example, if you are a farmer that depends on groundwater, you have to pay for a well, you know, install a well that goes down into the ground, and pay for the pumps, but the water itself you might not be paying for. You might not be paying for water that you draw from a lake for example. So oftentimes one of the things that we talk about in desalination is we have to lower the cost of water if we want this technology to be more competitive, because we're competing against really cheap access to water in lots of parts of the world.

And then just let's talk about that one drawback other than the energy intensity, which has to do with increasing the salinity in wherever it is you're pulling the water from. If you take out the fresh water but you leave the salt, what does that do to the local ecosystem.

And then just let's talk about that one drawback other than the energy intensity, which has to do with increasing the salinity in wherever it is you're pulling the water from. If you take out the fresh water but you leave the salt, what does that do to the local ecosystem.

Yeah, so reverse osmosis, which as I mentioned is the most commonly used process today, ends up resulting into two streams of water. Like you have the fresh water, which is what you want to go on and use, and then you have this thing called brine. And this is Basically, this even saltier water that is left behind. Globally, more than one hundred and fifty million cubic meters of brine are produced per day from desalination, which is more than double the amount of fresh water produced from those same facilities. Now, this brine can have an impact on the environment. First of all, it's saltier, which is not what the aquatic life in oceans are used to. But you can also have other impacts, such as the temperature being different. That's why these facilities have to take into account things like how they disperse this brine into the ocean in order to try to minimize impacts. They also have to design their systems so that you know, aquatic life isn't actually sucked into with the desalination plant in the first place when they're grabbing the ocean water.

Yeah, so reverse osmosis, which as I mentioned is the most commonly used process today, ends up resulting into two streams of water. Like you have the fresh water, which is what you want to go on and use, and then you have this thing called brine. And this is Basically, this even saltier water that is left behind. Globally, more than one hundred and fifty million cubic meters of brine are produced per day from desalination, which is more than double the amount of fresh water produced from those same facilities. Now, this brine can have an impact on the environment. First of all, it's saltier, which is not what the aquatic life in oceans are used to. But you can also have other impacts, such as the temperature being different. That's why these facilities have to take into account things like how they disperse this brine into the ocean in order to try to minimize impacts. They also have to design their systems so that you know, aquatic life isn't actually sucked into with the desalination plant in the first place when they're grabbing the ocean water.

Okay, so there are certainly some drawbacks that one needs to consider before we revert to wide scale use of desalination and before we go to the measures that are being taken to maybe reduce water consumption. So we're being a little wiser about what it is that we're applying it to and how we're doing it. Let's just talk about one other emerging technology. So atmospheric water generation is seen as an emerging technology. But I'm going to stop for a minute before you get to well, when you go to explain what it is, can you also tell me how this technology differs from the dehumidifier that I have sucking the water out of my clothes as I'm drying them on the drying rack.

Okay, so there are certainly some drawbacks that one needs to consider before we revert to wide scale use of desalination and before we go to the measures that are being taken to maybe reduce water consumption. So we're being a little wiser about what it is that we're applying it to and how we're doing it. Let's just talk about one other emerging technology. So atmospheric water generation is seen as an emerging technology. But I'm going to stop for a minute before you get to well, when you go to explain what it is, can you also tell me how this technology differs from the dehumidifier that I have sucking the water out of my clothes as I'm drying them on the drying rack.

Oh, sometimes it doesn't actually, So the idea high atmospheric water generation is that you are taking water vapor from the air and condensing it, and there are actually a couple of ways to do that. Some of it is simple condensation, which is like the seeing technology that is in your dehumidifier. Actually, sometimes it's instead using a process called absorption, in which you have basically a solid that the water then adheres to. Sometimes you have things called bognets, which are basically inspired by spiderwebs and water drop lists collect on the strings of these nets and then coalesce together, creating more water. So atmospheric water generation is actually just an umbrella term for a couple of different technologies, but they all aim to collect water from the air instead. This makes it different from desalination, which you know requires some sort of large body of salty water nearby. Atmospheric water generation isn't limited by having access to a body of water, it's instead thinking about how much humidity is in the air.

Oh, sometimes it doesn't actually, So the idea high atmospheric water generation is that you are taking water vapor from the air and condensing it, and there are actually a couple of ways to do that. Some of it is simple condensation, which is like the seeing technology that is in your dehumidifier. Actually, sometimes it's instead using a process called absorption, in which you have basically a solid that the water then adheres to. Sometimes you have things called bognets, which are basically inspired by spiderwebs and water drop lists collect on the strings of these nets and then coalesce together, creating more water. So atmospheric water generation is actually just an umbrella term for a couple of different technologies, but they all aim to collect water from the air instead. This makes it different from desalination, which you know requires some sort of large body of salty water nearby. Atmospheric water generation isn't limited by having access to a body of water, it's instead thinking about how much humidity is in the air.

Okay, So now that we've talked about the technologies that are potentially increasing supply, let's talk about water management and what can be done to reduce the amount of demand. You know how much of a role deletes play in pipes. You know, what are some of the main areas where we're just losing water needlessly, and what steps are being taken to ameliorate that.

Okay, So now that we've talked about the technologies that are potentially increasing supply, let's talk about water management and what can be done to reduce the amount of demand. You know how much of a role deletes play in pipes. You know, what are some of the main areas where we're just losing water needlessly, and what steps are being taken to ameliorate that.

In addition to being able to increase these sources of water that we have, being able to reduce how much water we need is also incredibly useful, and there are a couple of ways that we can do this. Let's start from the utility perspective. Water utilities are often the way in which water gets distributed in places, and so we have these large infrastructure networks that manage these large water flows, covering everything from distributing drinking water to also storm water management. Now, if we look at just drinking water, we know that today over three hundred and forty five million cubic meters of water are lost in distribution daily, and that's money that is lost by those water utilities because it's water that they sent out but didn't actually make it to a customer, so they don't get to charge their customers for it. But it's also water that we would rather put to good use. We would rather not waste that water. You also have things like making sure that these really large infrastructure systems are operating well. We can that way, we can find these leaks quickly, we can manage the equipment well. And so as a result, we ATF tracked thirty six different companies that are selling their products to these utilities across those different use cases around managing their equipment better, finding leaked to connection, being able to monitor their water quality, all in an effort to make sure that we use our water more effectively. These companies have collectively raised two hundred seventy six million dollars since twenty sixteen, which is admittedly raising money a little slower than most climate technologies. But that's not to say that this isn't really useful, because we really need to make sure that we're using our water as effectively as possible.

In addition to being able to increase these sources of water that we have, being able to reduce how much water we need is also incredibly useful, and there are a couple of ways that we can do this. Let's start from the utility perspective. Water utilities are often the way in which water gets distributed in places, and so we have these large infrastructure networks that manage these large water flows, covering everything from distributing drinking water to also storm water management. Now, if we look at just drinking water, we know that today over three hundred and forty five million cubic meters of water are lost in distribution daily, and that's money that is lost by those water utilities because it's water that they sent out but didn't actually make it to a customer, so they don't get to charge their customers for it. But it's also water that we would rather put to good use. We would rather not waste that water. You also have things like making sure that these really large infrastructure systems are operating well. We can that way, we can find these leaks quickly, we can manage the equipment well. And so as a result, we ATF tracked thirty six different companies that are selling their products to these utilities across those different use cases around managing their equipment better, finding leaked to connection, being able to monitor their water quality, all in an effort to make sure that we use our water more effectively. These companies have collectively raised two hundred seventy six million dollars since twenty sixteen, which is admittedly raising money a little slower than most climate technologies. But that's not to say that this isn't really useful, because we really need to make sure that we're using our water as effectively as possible.

Well, and so then you know, let's talk about agriculture, which is an application that we I think all kind of really understand in its basic sense. And you identified earlier that in some of these use cases, you know, they are aquifers underground, they have access to them, but that doesn't mean that it's limitless. Is that the primary motivation for innovation in reducing water use in agricultural applications and what are some of the way is that the agriculture system is actually trying to be a little bit more cautious about their water consumption.

Well, and so then you know, let's talk about agriculture, which is an application that we I think all kind of really understand in its basic sense. And you identified earlier that in some of these use cases, you know, they are aquifers underground, they have access to them, but that doesn't mean that it's limitless. Is that the primary motivation for innovation in reducing water use in agricultural applications and what are some of the way is that the agriculture system is actually trying to be a little bit more cautious about their water consumption.

Yeah. So, as I mentioned earlier, agriculture is the largest user of fresh water supply, and water stress therefore really is impactful to this industry. It's whether it's aquifers that are being drawn down and aren't being replenished by ra water, whether it's rivers that have so much water being withdrawn upstream that by the time you a downstream farmer gets access to the river, it's drier than it would have been otherwise. Altogether, we're seeing that water stress is increasingly a challenge that farmers and the agriculture industry have to face. But it's also one that we it's really important that we resolved. Irrigation is one of the ways you do that right, and some nine hundred and thirty five billion cubic meters of water we're used for irrigation purposes. In twenty twenty one, irrigated lands account for thirty three percent of global crop production and forty four percent of cereal production despite only being twenty four percent of crop lands, meaning that like they're functuring above their weight, your irrigation is really important. But climate change is making these water flows more erratic, and so the agriculture sector is looking at how they can use water more efficiently, specifically by thinking about how they can lower the amount of water they use or time when using that water really well, so that they can use less water while improving their yield. The way they do this is through analytics that can help them better understand things like weather patterns, soil moisture, better understand where water is being lost on the farm, and the hope is that they can minimize crop losses as a result. Just as an example, in the US since two thousand, drought and high temperatures have been the primary driver of indemnified crop loss under the US Federal Crop Insurance Program, responsible for forty three point seven percent of pavements. So figuring out how to use water really effectively has significant financial consequences for agriculture.

Yeah. So, as I mentioned earlier, agriculture is the largest user of fresh water supply, and water stress therefore really is impactful to this industry. It's whether it's aquifers that are being drawn down and aren't being replenished by ra water, whether it's rivers that have so much water being withdrawn upstream that by the time you a downstream farmer gets access to the river, it's drier than it would have been otherwise. Altogether, we're seeing that water stress is increasingly a challenge that farmers and the agriculture industry have to face. But it's also one that we it's really important that we resolved. Irrigation is one of the ways you do that right, and some nine hundred and thirty five billion cubic meters of water we're used for irrigation purposes. In twenty twenty one, irrigated lands account for thirty three percent of global crop production and forty four percent of cereal production despite only being twenty four percent of crop lands, meaning that like they're functuring above their weight, your irrigation is really important. But climate change is making these water flows more erratic, and so the agriculture sector is looking at how they can use water more efficiently, specifically by thinking about how they can lower the amount of water they use or time when using that water really well, so that they can use less water while improving their yield. The way they do this is through analytics that can help them better understand things like weather patterns, soil moisture, better understand where water is being lost on the farm, and the hope is that they can minimize crop losses as a result. Just as an example, in the US since two thousand, drought and high temperatures have been the primary driver of indemnified crop loss under the US Federal Crop Insurance Program, responsible for forty three point seven percent of pavements. So figuring out how to use water really effectively has significant financial consequences for agriculture.

Okay, so when it comes to water and perhaps recycling of water, where does the role of gray water come into this? And water treatment and reuse, which you know is reducing the amount of what is required because you're making better use of what you already have.

Okay, so when it comes to water and perhaps recycling of water, where does the role of gray water come into this? And water treatment and reuse, which you know is reducing the amount of what is required because you're making better use of what you already have.

Yeah, absolutely thinking about reusing, recycling, and also eventually you discharge water out into the world. All of that means that you want to think about water and wastewater treatment. You want to make sure that the water is still at a good enough quality for whatever it is your deal with mix. So if you're trying to recycle water within your plant, you want to make sure that the water is still pure enough that it's not going to damage your equipment. If you are discharging it out into the environment, you want to make sure that it is clean enough that you're not running into problems with environmental regulations. So that means thinking about things like heavy metals, chemicals, microbes. These are all different types of impurities that can be found in water, and depending on what that water is used for, you want to think about what's the concentration of those impurities that you want in your water. So water treatment tech is already widely used today, as is wastewater treatment, and as water stress becomes more salient, we can expect to see these technologies become more used throughout the world.

Yeah, absolutely thinking about reusing, recycling, and also eventually you discharge water out into the world. All of that means that you want to think about water and wastewater treatment. You want to make sure that the water is still at a good enough quality for whatever it is your deal with mix. So if you're trying to recycle water within your plant, you want to make sure that the water is still pure enough that it's not going to damage your equipment. If you are discharging it out into the environment, you want to make sure that it is clean enough that you're not running into problems with environmental regulations. So that means thinking about things like heavy metals, chemicals, microbes. These are all different types of impurities that can be found in water, and depending on what that water is used for, you want to think about what's the concentration of those impurities that you want in your water. So water treatment tech is already widely used today, as is wastewater treatment, and as water stress becomes more salient, we can expect to see these technologies become more used throughout the world.

So as we think about this as a problem that will affect certain regions more than others, but certainly is global. Are these solutions and some of these ways of purifying water, treating water, recycling water, do they have wide scale application or are these going to be really hyper regional, hyperlocal solutions. I guess the question I'm asking is how scalable are the solutions going to be? As people are looking to tackle water stress worldwide.

So as we think about this as a problem that will affect certain regions more than others, but certainly is global. Are these solutions and some of these ways of purifying water, treating water, recycling water, do they have wide scale application or are these going to be really hyper regional, hyperlocal solutions. I guess the question I'm asking is how scalable are the solutions going to be? As people are looking to tackle water stress worldwide.

We've already seen how water tech can be widely adopted. Take drinking water right, We around the world have parts of the world which have really good access to drinking water because we've done a good job of building the infrastructure required to treat that drinking water. Access to clean water has expanded significantly over the last two decades, although we still have large portions of Oceana and Sub Saharan Africa that remain without access to it. Wastewater treatment is also widespread. Now there are over fifty thousand municipally operated wastewater treatment plants around the world globally, and we can expect to see that increase as more places adopt wastewater regulations. However, it should be noted that when I say water treatment tech that encompasses so many things, there are over one hundred different technologies that I am subtly referencing in that, and that's because water can just be so different. The water that comes out of a pulp and paper manufacturing facility is different from the water that comes out of a steel facility, is different from the water that comes out of my apartment, for example. So there is plenty of opportunity for water tech to grow an adoption, though exactly what type of technology it's actually a little bit more specific than that, and not everything works in every circumstance.

We've already seen how water tech can be widely adopted. Take drinking water right, We around the world have parts of the world which have really good access to drinking water because we've done a good job of building the infrastructure required to treat that drinking water. Access to clean water has expanded significantly over the last two decades, although we still have large portions of Oceana and Sub Saharan Africa that remain without access to it. Wastewater treatment is also widespread. Now there are over fifty thousand municipally operated wastewater treatment plants around the world globally, and we can expect to see that increase as more places adopt wastewater regulations. However, it should be noted that when I say water treatment tech that encompasses so many things, there are over one hundred different technologies that I am subtly referencing in that, and that's because water can just be so different. The water that comes out of a pulp and paper manufacturing facility is different from the water that comes out of a steel facility, is different from the water that comes out of my apartment, for example. So there is plenty of opportunity for water tech to grow an adoption, though exactly what type of technology it's actually a little bit more specific than that, and not everything works in every circumstance.

Yeah, So while we're talking about, you know, trying to apply some industrial processes to improve water quality for some of the broader use cases, there are going to be lots of different use cases that are going to need to emerge and have this water tech that you're speaking about. So let's go into one of those more specific cases, which has to do with purifying water and these You know, well, there's a lot of discussion about forever chemicals and human consumption and how food water is carrying some of these things at the moment. So PFAS, which stands for I don't even think I can say this out loud, what does PFAST stand for?

Yeah, So while we're talking about, you know, trying to apply some industrial processes to improve water quality for some of the broader use cases, there are going to be lots of different use cases that are going to need to emerge and have this water tech that you're speaking about. So let's go into one of those more specific cases, which has to do with purifying water and these You know, well, there's a lot of discussion about forever chemicals and human consumption and how food water is carrying some of these things at the moment. So PFAS, which stands for I don't even think I can say this out loud, what does PFAST stand for?

I was, well, I was looking at that. I was like, oh god, I have to power and polyfloral alkyl substances.

I was, well, I was looking at that. I was like, oh god, I have to power and polyfloral alkyl substances.

Right, So this term, First of all, what a PFAS? Why should we be concerned? And then on the more optimistic side, what is happening in water tech to reduce p FAST in our water?

Right, So this term, First of all, what a PFAS? Why should we be concerned? And then on the more optimistic side, what is happening in water tech to reduce p FAST in our water?

Yes? So p FAS is an umbrella term for thousands of different synthetic chemicals. So basically, I want you to think of a nice little hydrocarbon chain and we're going to pop off some of those hydrogen atoms and attach multiple fluorine atoms instead. This gives it the property where it can be used in nonstick coatings and waterproofing, firefighter films, among a bunch of other things. And PFASs really became very prevalent throughout different manufacturing processing. The downside is that PFAS is really long lasting and bioaccumulating, and we now have a growing body of scientific research sewing that pfas can have health impacts, including impacts on raising cholesterol, diminished antibody responses, and increased likelihood of cancer. As a result, we have seen increasing government regulation of p fas, and we've also seen lots of lawsuits against major chemical companies accusing them of basically polluting water with pfas. So PFAS is clearly getting a lot more attention these days as like an emerging contaminant that we now need to create the technologies to be able to treat.

Yes? So p FAS is an umbrella term for thousands of different synthetic chemicals. So basically, I want you to think of a nice little hydrocarbon chain and we're going to pop off some of those hydrogen atoms and attach multiple fluorine atoms instead. This gives it the property where it can be used in nonstick coatings and waterproofing, firefighter films, among a bunch of other things. And PFASs really became very prevalent throughout different manufacturing processing. The downside is that PFAS is really long lasting and bioaccumulating, and we now have a growing body of scientific research sewing that pfas can have health impacts, including impacts on raising cholesterol, diminished antibody responses, and increased likelihood of cancer. As a result, we have seen increasing government regulation of p fas, and we've also seen lots of lawsuits against major chemical companies accusing them of basically polluting water with pfas. So PFAS is clearly getting a lot more attention these days as like an emerging contaminant that we now need to create the technologies to be able to treat.

So to sum this up, we've tried to talk about water and water applications supply demand different purification processes in a very short period of time on this show. We just barely touched upon it and set the groundwork for further conversation on this topic. But what I'm hearing from you is that there are some legacy existing technologies that have wider use case, and there are emerging technologies that some of them will be more niche applications, and some of them will be tackling some of these more prevalent, increasingly prevalent issues like pfas, and this is a space that's actively being covered, that there's a lot of innovation happening at the moment, and that you know, there's certainly something to watch as we look at this really critically important resource not only for human survival and agriculture, but also for the modern world we live in with energy consumption and AI is that a fair estimation? What did I miss Stephanie? What is the other takeaway that you may have from the work that you did delving into the world of water as it relates to bn F.

So to sum this up, we've tried to talk about water and water applications supply demand different purification processes in a very short period of time on this show. We just barely touched upon it and set the groundwork for further conversation on this topic. But what I'm hearing from you is that there are some legacy existing technologies that have wider use case, and there are emerging technologies that some of them will be more niche applications, and some of them will be tackling some of these more prevalent, increasingly prevalent issues like pfas, and this is a space that's actively being covered, that there's a lot of innovation happening at the moment, and that you know, there's certainly something to watch as we look at this really critically important resource not only for human survival and agriculture, but also for the modern world we live in with energy consumption and AI is that a fair estimation? What did I miss Stephanie? What is the other takeaway that you may have from the work that you did delving into the world of water as it relates to bn F.

Water is one of those things, like I said at the beginning of the show, we kind of take it for granted in lots of parts of the world because it just is available. But as climate change changes that availability, we shouldn't be taking it for granted. And water is really useful and really important. It's one of the small areas of climate tech, but it is one that is going to play a significant role in the future. And just to kind of illustrate what I mean by that, I want to give you an example of like where I live, because I live in New York City and we're in the part of the US known for having plentiful water. We actually get more rain in a year than London, but we're currently in a moderate drought according to the US National Oceanic and Atmospheric Administration and have been since the fall. And this drought actually led to us postponing work on the Delaware Aqueduct, which is what an aqueduct that normally provides ninety percent of my city's drinking water. It needs repair because it currently leaks about thirty five million gallons of water a day, but the drought meant that we had to postpone network. That's an example of water stress and challenges in a place that normally isn't water stressed and challenged. So all of this to say that you'll be hearing more about water as time goes on.

Water is one of those things, like I said at the beginning of the show, we kind of take it for granted in lots of parts of the world because it just is available. But as climate change changes that availability, we shouldn't be taking it for granted. And water is really useful and really important. It's one of the small areas of climate tech, but it is one that is going to play a significant role in the future. And just to kind of illustrate what I mean by that, I want to give you an example of like where I live, because I live in New York City and we're in the part of the US known for having plentiful water. We actually get more rain in a year than London, but we're currently in a moderate drought according to the US National Oceanic and Atmospheric Administration and have been since the fall. And this drought actually led to us postponing work on the Delaware Aqueduct, which is what an aqueduct that normally provides ninety percent of my city's drinking water. It needs repair because it currently leaks about thirty five million gallons of water a day, but the drought meant that we had to postpone network. That's an example of water stress and challenges in a place that normally isn't water stressed and challenged. So all of this to say that you'll be hearing more about water as time goes on.

Something to watch, and thank you Stephanie so much for coming and is sharing lots of thoughts on how we should be thinking about water.

Something to watch, and thank you Stephanie so much for coming and is sharing lots of thoughts on how we should be thinking about water.

Thanks for having me.

Thanks for having me.

Today's episode of Switched On was produced by Cam Gray with production assistance from Kamala Shelling. Bloomberg NIF is a service provided by Bloomberg Finance LP and its affiliates. This recording does not constitute, nor should it be construed as investment in vice investment recommendations, or a recommendation as to an investment or other strategy. Bloomberg ANIF should not be considered as information sufficient upon which to base an investment decision. Neither Bloomberg Finance LP nor any of its affiliates makes any representation or warranty as to the accuracy or completeness of the information contained in this recording, and any liability as a result of this recording is expressly disclaimed

Today's episode of Switched On was produced by Cam Gray with production assistance from Kamala Shelling. Bloomberg NIF is a service provided by Bloomberg Finance LP and its affiliates. This recording does not constitute, nor should it be construed as investment in vice investment recommendations, or a recommendation as to an investment or other strategy. Bloomberg ANIF should not be considered as information sufficient upon which to base an investment decision. Neither Bloomberg Finance LP nor any of its affiliates makes any representation or warranty as to the accuracy or completeness of the information contained in this recording, and any liability as a result of this recording is expressly disclaimed