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Friday, January 14, 2011

Energy’s Water Demand: Trends, Vulnerabilities, and Management

Nicole T. Carter
Specialist in Natural Resources Policy

The energy choices before Congress represent vastly different demands on domestic freshwater because water is used in varying amounts in most aspects of the energy sector. Transitions in the energy sector, such as the pursuit of greater energy independence and security, produce changes in how much and where the energy sector uses water. The energy sector is the fastest-growing water consumer in the United States, in part because of energy policies. Whether the federal government addresses the energy sector’s rising water demand, and if so how, is one of the many energy decisions that may be considered by the 112th Congress.

Much of the growth in the energy sector’s water demand is concentrated in regions with already intense competition over water. Whether the energy sector exacerbates or alleviates future water tensions is influenced by near-term energy policy and investment decisions. These decisions also may determine whether water will limit or harm U.S. capability to reliably meet the nation’s energy demand. Part of the policy issue for Congress is identifying the extent of the federal role in responding to the energy sector’s water use. Currently, the energy industry and states have the most responsibility for managing and meeting the energy sector’s water demand.

The energy sector’s water consumption is projected to rise 50% from 2005 to 2030. Projections attribute to the energy sector 85% of the growth in domestic water consumption between 2005 and 2030. The drivers of the energy sector’s increasing water use are rising energy demand, greater development of domestic energy, and shifts to more water-intense energy sources and technologies. The more water used by the energy sector, the more vulnerable the energy system is to water availability. Climate change alterations of historic water patterns may exacerbate this vulnerability in some regions. While the energy sector’s water demand is anticipated to rise across the United States, the West is likely to experience some of the more significant constraints in meeting this demand. Examples of regional water use concerns related to energy are shale gas production using hydraulic fracturing in many regions across the nation, some solar electricity generation in the Southwest, and current biofuel feedstock production in the High Plains.

The 112
th Congress may see the issue of energy’s water demand in a variety of contexts, including oversight and legislation on energy, infrastructure, environment, agriculture, public lands, climate, research, and water. Approaches for addressing energy’s water demand range from maintaining the current approach to taking a range of actions. One set of available actions includes those that attempt to minimize the growth in energy’s freshwater use (e.g., through promotion of water-efficient energy alternatives and energy demand management), which could be accomplished through changes to broad policies or legislation targeted at water use. Many of the possible actions to decrease water use come with energy cost, generation, and reliability penalties. Another set of actions includes measures that facilitate access to water for the energy sector. While water allocations and permits generally are a state responsibility, limited federal actions to provide water to the energy sector are possible (e.g., access to surplus water at federal reservoirs). An additional set of actions encompasses investments in data and research to inform decision making and to expand water-efficient energy technology choices. These approaches represent different potential roles and expenses for government, the energy sector, and energy consumers. Legislation in the 111th Congress proposed a variety of actions, including provisions in H.R. 469, H.R. 2454, H.R. 3598, H.R. 1145, S. 1462, S. 1733, S. 3396, and the Secure Water Act of 2009, Subtitle IV of P.L. 111-11 (H.R. 146). A significant challenge to a federal response to the energy sector’s water demand is that the available options are not equally needed, attractive, or feasible across the United States.

Date of Report: January 5, 2011
Number of Pages: 40
Order Number: R41507
Price: $29.95

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