Water scarcity could drive push towards wind and solar

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Emissions controls will not be the only factor influencing our choice of future energy sources. The IEA and private analysts have pointed to the impending water crisis which could lead to stranded assets – particularly in coal and shale gas – and accelerate the push towards ‘dry’ technologies, like wind and solar PV.

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In 2010, more water – 583 billion cubic metres – than is discharged each year by the mighty Ganges River in India was used to meet the world’s growing energy needs.

It’s an interesting statistic, but why should that matter? Well, if the world continues on its merry way, power capacity – particularly with water-hungry energy technologies such as coal and nuclear – and water-dependent extractive techniques such as coal, shale gas and tar sands, are going to grow quickly, and, according to the International Energy Agency, the world’s demand for water will grow at twice the pace, putting pressure on increasingly scarce water resources.

In countries such as India and China which are already experiencing water stress, power demands will grow 70 per cent over the next 20 years. Most of their water is reserved for agricultural and municipal needs. Both countries, like many others in the developing world, are water stressed, and neither can afford to replicate the US, where nearly half of the water consumption is reserved for energy use – biofuels, coal mining, gas extraction, and generation.

The pressure is so great that the IEA has, for the first time, dedicated a whole chapter of its annual reference work, the World Energy Outlook, to the issue of water scarcity and energy supply.  It says water is going to become an “increasingly serious” issue for unconventional gas development and power generation in parts of China and the US, and for the growing fleet of water-dependent power plants in India, and the oil sands production in Canada.

It seems to serve as a warning to those that wish to invest in energy projects. As a general rule – with the exception of water-hungry nuclear – the more emissions intensive the energy type, the more water it needs. The politics of climate change may mean that no limits on carbon emissions are imposed to restrain the development of these technologies, but nature may impose its own restraint through the access to water. And, as the IEA notes, a surging population, a growing economy and heightening climate change impacts will further impact on energy reliability and costs.

It might be the first time that the IEA has addressed the issue of water stress and its impact on the electricity sector, but private analysts have been watching the issue carefully for some time.

In September, HSBC Bank issued a report, entitled No water, no power, that looked at the challenges facing China and its electricity demand, highlighting the fact that its most coal-rich and industrialised provinces faced the most critical water shortages, and the ambitious expansion plans for power capacity faced real constraints. “There is a mismatch between water capacity and planned capacity additions,” it noted.

The HSBC report said that some 47 per cent of China’s coal reserves are located in provinces where water is scarce (see graph), and HSBC thinks there may not be enough water to extract it. “Coal requires water to extract, transport, process (wash), store and dispose. We think water scarcity is another reason for authorities to reduce reliance on fossil fuels,” they wrote. “Without a vast improvement in the water efficiency of power capacity, some power plants potentially run the risk of becoming stranded assets.”

The Chinese administration is obviously aware of the challenges. “We should launch a revolution in energy production and consumption, impose a ceiling on total energy consumption,” the outgoing leader Hu Jintao told the party congress this week.

The IEA picks up on a similar theme. It notes that energy efficiency and wind energy and solar PV are the energy options with the lowest water requirements (see table below), and in its 450 scenario – where the world acts boldly to limit global warming – the deployment of these technologies means that water use grows only marginally over the coming decades.

In its business-as-usual and its “lip service” scenarios – where governments do a little bit on climate but not terribly much – water demands grow exponentially.

However, apart its focus on energy efficiency and renewables such as solar PV and wind, the IEA’s mainstream 450 Scenario also requires technologies – including nuclear power, CCS-fitted power plants and conventional biofuels – whose high water-use requirements must be taken into account. All of these technologies can find ways of using less water, but to do so adds to operating and capital costs, and can make the plants less efficient in some instances. Solar thermal – or concentrated solar power – which uses the sun’s heat (instead of coal) to boil water – is also water hungry.

The HSBC report notes that three provinces – Shanxi, Shaanxi, Inner Mongolia and Xinjiang – hold 74 per cent of China’s total coal resources, but only 7 per cent of the nation’s water resources. This could limit the scope to build power plants in those areas, forcing more coal to be transported to demand centres, adding to capacity bottlenecks – the infamous 110km traffic jam in China in 2010 was caused by more than 10,000 trucks carrying coal supplies from Inner Mongolia. Water shortages in those areas have already caused the cancellation of dozens of water intensive coal-to-liquids projects.

In nuclear power, while all of China’s existing plants use seawater for cooling, future plans include the development of inland nuclear power facilities – three are due to start construction during the course of the 12th Five-Year Plan – that will add to competition for scarce water resources where the plants are sited.

The IEA notes that India is facing similar problems. Summer water shortages in 2010 caused the 2.3GW Chandrapur coal-fired power station in Maharashtra to shut down, leading to power outages across the state. The plant again faced water shortages, due to the delayed monsoon, in mid-2012, and water shortages in northern India have at times reduced hydropower generation, exacerbating power shortages due to insufficient coal supply to power plants.

In the US, the IEA notes, concerns about water availability and the effect of production on water quality could also significantly slow the development of shale gas production – particularly in water-poor states such as Texas.

“There is no doubt that water is growing in importance as a criterion for assessing the physical, economic and environmental viability of energy projects,” the IEA notes.

The Agency says there are several options to address this: one is a greater reliance on renewable energy technologies that have minimal water requirements, such as solar PV and wind; another is to improve the efficiency of plants, and another is to deploy more advanced cooling systems. (The CSIRO is working on one technology that uses minimal amounts of water for solar thermal plants).

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  1. David 7 years ago

    In Victoria, the new Wonthaggi desalination plant has a production capacity roughly comparable with the water used in brown coal generators in the nearby Latrobe valley. If the supposed $5 billion cost of the plant is true, an alternative would have been progressive closure of the generators to make this fresh water available. The $5 billion saving would pay for several GW of PV or wind power.
    Several GW of PV or wind would not replace 6 GW of (very old) brown coal generation; but it makes you think.

  2. Concerned 7 years ago

    Wonder how Kogan Creek copes?

    • Ronald Brak 7 years ago

      Kogan Creek uses air cooling which cuts its water use by about 90% compared to normal coal plant. Cost is why air cooling is not more common.

  3. keith williams 7 years ago


    Does the IEA say anything about the converse problem with coal, nuclear etc ie flooding? Since these plants are usually set close to rivers, the sea, what happens if climate change accelerates sea level rise substantially?

    Given that the 2007 IPCC projections on sea level rise didn’t account for arctic and antarctic melting, I suspect the new projections for sea level rise are going to be scary and surely must have implications for siting plants that need lots of cooling water … not cheap to relocate a coal or nuclear plant???

  4. Bart 7 years ago

    As a point of comparison, a desalination plant using RO produces 4*10^5 liters of water per MWh. So any of the above plants could replace all their water consumption with 3% or less of their power output.

    There is still the issue of getting the water to where its needed and the cost of the desalination plant.

    • Concerned 7 years ago

      Re distillation, a Nuclear Plant on the coast ,MSF and MED does for it for very little, apart from capital cost and maintenance using the waste heat.
      KoganCreek,as it works must give a return to investors?

    • David 7 years ago

      Bart, the power consumed by the desalination process is not an issue. It is the capital cost which is the problem. If the Wonthaggi plant cost $5 billion to produce enough water to cool 6 GW of coal generation then that is almost $1000/kW added cost. This would about one third of the cost of new coal plant.

      • Ronald Brak 7 years ago

        David, my comment below is not meant to suggest that it would be practical to pipe seawater inland to cool power plants. Just as desalination plants are too expensive to be practical, piping water any real distance inland, whether fresh or salt, would have both capital and energy cost that are far too high to be practical.

    • Ronald Brak 7 years ago

      Water doesn’t need to be fresh to be used for cooling, so desalination isn’t necessary.

  5. Uzza 7 years ago

    I would like to note that the case for nuclear is not as clean cut as it’s made out to be here.
    The water requirement for nuclear power depends on the type of reactor used.

    Current reactors use quite a bit of water, but there are a thousand ways to build a nuclear reactor (not all are good ideas though.)

    There are reactors that use almost zero water in the cooling operation, and the thing they have in common is that they’re high temperature reactors.
    Since they operate at high temperature, there is a very large temperature difference between the reactor and it’s ultimate heat sink, making it possible to do passive air cooling.
    Even better, since they’re high temperature, they can use other turbines types than steam, or even combines cycles, to increase thermodynamic efficiency, reducing the amount of heat that needs to be cooled per MWh.

    Something that can be done for many power plants is to not just let the heat radiate away, but instead use it productively in, for example, a district heating system.

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