The water and energy sectors are becoming increasingly integrated and interdependent. This requires collaboration. Therefore, the skills of workers, regulators, and policymakers should be based on mutual understanding. As sector integration increases, more win-win scenarios will emerge to optimize infrastructure development and we should take those opportunities.
Water and energy dependency
Water sources supply 45% of the region’s electricity. They are also essential for refining minerals and cooling energy processes. Imagine the regional hydropower generation faltering due to reduced flow caused by climate change.
The water sector’s reliance on electricity has grown as well. According to the IEA, global electricity consumption in the water sector will increase from 978 TWh in 2020 to 1,473 TWh in 2040. This growth of over 50% in just two decades is mainly driven by increasing demand and droughts, prompting countries to explore ways to supply drinking water from farther and deeper sources. All these extracting and pumping actions require extra power.
Water shortages and technological improvements lead many countries to develop desalination. Despite its high power consumption (around 4 kWh per m³), desalination’s share in global consumption is expected to rise from 5.7% in 2020 to 23.4% in 2040. About 60% of global energy consumption growth by 2040 will be related to desalination.
Promoting innovation to tackle water-energy challenges
The global water-energy dependency trends mirror the challenges faced in LAC. In August 2023, the IDB launched “Ideas into Action” in collaboration with the Government of Israel. This pilot program of “Source of Innovation” collected regional challenges evaluated by IDB experts and matched them to potential solutions. As a result, 18 projects have been selected to receive funding for 2024-2025. These three examples address the water-energy interface and improve regional capacity to tackle global trends:
Floating photovoltaic (FPV) systems: This project aims to develop a novel technology with automatic floater tracking to increase solar generation in water reservoirs in the Bahamas, Brazil, and Honduras. Using water bodies for FPV reduces water evaporation, develops self-generation nearby consumption, and cuts operation costs for water utilities. In the energy sector, distributed renewable energy benefits electricity grid operators, reduces carbon footprints, and conserves land compared to traditional PV farms.
Energy efficiency in water networks: In Pasto, Colombia, Empresa de Obras Sanitarias de Pasto operates flowmeters to reduce water leakages and optimize water services. The proposed solution uses sustainable thermal energy sources to increase flowmeters’ battery life and improve flow data transmission, reducing electricity costs and enhancing water supply. Digitalization trends and higher electricity costs challenge water authorities due to ineffective electric sources for metering large networks.
Desalination based on renewables: The Surinam Water Company aims to develop a sustainable brackish water desalination plant powered by solar energy. The project will select optimal sites in the coastal region, design appropriate technology, and develop a full techno-economic model. With many LAC countries facing drinking water scarcity, sector planners are seeking desalination solutions. These systems require significant capital, long execution timelines, and substantial energy consumption.
How we should act to achieve holistic water-energy synergy
The region’s challenges demand comprehensive, cross-sector solutions. Multidisciplinary diversification of technologies, assimilation of knowledge, and supportive regulations are key to mitigating negative impacts.
More than ever, water organizations need knowledge and experience in energy production and consumption. They should:
- Monitor and analyse energy data, professional capacity building, and generate electricity consumption forecasts based on various parameters.
- Enhance market proficiency and best practices awareness in energy generation within facilities and optimize electricity consumption.
- Develop an organizational culture and incentives for energy efficiency and self-generation.
- Create and maintain a strategic plan to promote self-generation along with an energy efficiency program to reduce consumption.
- Foster innovation ecosystem and implement pilots of energy solutions.
Equally, energy organizations need to specialize in the trends and needs of the water sector in the future. They should:
- Invest in research and development of energy production and optimization solutions tailored to water companies, as exemplified by the Ideas into Action initiative.
- Assess different scenarios in the water sector to measure the impact on energy facilities.
- Plan energy generation and its forecasts based on water trends and forecasts.
- Foster innovation ecosystem and implement pilots to optimize energy generation and water use in internal processes within the sector.
Want to know more about innovation in water and sanitation in Latin America and the Caribbean? Source of Innovation is an alliance of the IDB Group with external partners to promote the development and adoption of innovative solutions in the water, sanitation, and solid waste sector to achieve smart, inclusive, and sustainable services, with a focus on service providers in Latin America and the Caribbean.
About Source of Innovation
Source of Innovation is a strategic alliance of the IDB Group with external partners to promote the development and adoption of innovative solutions in the water, sanitation, and solid waste sectors, aiming to achieve smart, inclusive, and sustainable services, with a focus on service providers in Latin America and the Caribbean. Source of Innovation is funded by the Government of Switzerland, through its State Secretariat for Economic Affairs (SECO), the Republic of Korea, through its Ministry of Environment, the Government of Spain, through its Ministry of Economic Affairs, Trade and Industry (MINECO), the Government of Israel., through its Ministry of Finance, the FEMSA Foundation, and The Coca-Cola Foundation. The alliance also benefits from direct contributions from IDB Lab and the Water and Sanitation Division of the IDB. Additionally, it maintains close coordination with the Aquafund, created with IDB capital and supported by a wide range of public and private sector partners.
Guest author
Erez Peri is a consultant in the Water and Sanitation and Energy Divisions at the Inter-American Development Bank (IDB) Headquarters in Washington, DC. His expertise lies in integrating economics, planning, and regulation of climate technologies. He has experience in infrastructure project development, fostering innovative solutions, and developing research methodologies.
Before joining the IDB, Peri worked in the private sector as a business development manager in the energy sector and as a lecturer at an academic college. An Israeli citizen, he holds a Doctorate (PhD) and a master’s degree in Environmental and Earth Sciences, having completed a direct PhD program at Tel-Aviv University in Israel.
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