Water has become one of the biggest risks to business continuity, sitting alongside cyberattacks and supply chain disruption on the risk registers of 340 executives of industrial producers and water utilities across Europe, Schneider Electric found in a survey.
Historically an underpriced, taken-for-granted line on a financial report, water is finally being recognized for its criticality as a limited resource dictating decision making at the highest level, according to The Water Crunch Report, released by Schneider Electric. Results of a survey among executives in Europe showed that for them water is on the same page as cybersecurity and supply chain security.
Availability and quality, alongside infrastructure constraints, are reshaping operational risk, investment priorities and growth planning, the document reads. The research was conducted with decision makers in 210 industrial organizations with more than a thousand employees each and 130 water utilities organizations.
“More than half of industrial leaders now expect water availability and quality to become a barrier to growth within the next five years… The companies building resilience today may be the ones that can still expand tomorrow,” the company pointed out.
It highlighted the example of Romanian military blasting a section of the Danube riverbed to keep water flowing to the Cernavodă nuclear power plant. The attempt failed to prevent a complete shutdown in mid-August. The facility is still offline, for at least another week.
Water risk reaches board-level discussions
The report was produced in partnership with Censuswide water industry journalist Tom
Freyberg. It involved France, Germany, Ireland, Italy, the Nordics (Sweden and Denmark), Spain and the United Kingdom.
“Water scarcity, infrastructure strain, and rising demand are creating new operational challenges across Europe. Industrial organizations are already increasing investment, revising procurement strategies, and elevating water risk to board-level discussions,” the document adds.
It also cites aging infrastructure and pressure from climate, as Europe is the fastest-warming continent.
Investment in smart tech is just a business case away
“Almost three in five industrial organizations describe their own water monitoring capability as immature. The barrier is not skepticism about the technology; it is legacy infrastructure, competing priorities, and, critically, an inability to build the internal business case for an investment they already believe in,” the authors stressed.
There is broad consensus that smart water technologies including real-time monitoring, digital twins and automated controls can provide visibility over distribution networks, treatment plants or in industrial operations.
Water becoming more expensive to source, treat, discharge
Respondents identified operating costs as the most common consequence of water stress over the past 24 months – 44% of them – meaning water is becoming more expensive to source, treat or discharge. Next are infrastructure strain and rising maintenance (38%) and stakeholder scrutiny of water practices (34%).
Disruption reaching upstream and downstream partners was flagged by 30%, compared to 29% mentioning a drop in local water quality affecting operations.
The pressures are unevenly distributed. In Spain, 60% of participants reported higher operating costs from water stress, but only 27% in France.
Water availability, quality or infrastructure capacity has already influenced a business decision among 98%.
The most important considerations in the industrial group’s business continuity planning are cybersecurity threats (53%), supply chain disruption (52%) and the disruption of water supply or quality (50%).