Smart water infrastructure could save emerging market countries $12.3 billion annually

Oct 01, 2013

Water scarcity is a growing problem across the globe, compounded by climate change and population growth. All signs indicate that this scarcity will only continue to grow more severe, even potentially leading to conflict between nations. An incredible 38% of all water produced in emerging market countries is lost to leakage from poor infrastructure, waste, and theft. Smart infrastructure aimed at addressing this problem could prove to be the most significant solution to water scarcity and has the potential to save $12.3 billion each year if fully implemented.

Emerging market countries are starting to take note and deploy smart water infrastructure to reduce their so called "non-revenue water." In fact, 72 emerging market countries are projected to cumulatively spend $46.5 billion by 2023, according to a new study released today by Northeast Group, LLC. Spending will be allocated across smart water metering, smart water networks, smart irrigation and software analytics to optimize water use.

"Emerging market nations are struggling with water scarcity and cannot continue to ignore the full cost of water and water losses," according to Ben Gardner, president of Northeast Group. "Implementing smart water infrastructure is a critical step these countries must take to address their water challenges."

Northeast Group's study calculates a "full cost of water" to account for implicit subsidies and infrastructure costs that are often not captured in utility tariffs. It uses this and current tariff costs to assess the savings potential for smart water infrastructure projects across 72 countries. The $12.3bn savings potential conservatively assumes one-third the difference between current tariffs and the full cost of water in each country.    

"The return on investment for smart water projects is very positive, with payback periods often of just a few years. Financing and technical issues remain challenging in some countries, but smart water infrastructure has benefits that far exceed costs in almost all markets," added Gardner.

Northeast Group's Emerging Markets Smart Infrastructure: Smart Water study is 160 pages long, includes forecasts of four market segments for 72 individual countries, profiles 35 case studies and key vendors and comes with an excel file with over 5,000 data points. To order a copy of the study, please visit: www.northeast-group.com or email Ben Gardner at: ben.gardner@northeast-group.com

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