Water and energy are intimately linked: no energy, no water; no water, no energy. Just one example – there is a huge amount of energy embedded in every drop of water. For example, 19% of California’s electricity is used in the heating, extraction, transportation and treatment of water.
At WaterSmart, we bridge the digital & physical worlds of water; we are using powerful network effects to do so; and we are using big data, in the cloud, to solve a critical resource problem. Water is delicious, essential, and irreplaceable. You would think we would take better care of it.
The World Economic Forum identified Water as the #1 global risk for 2015 in terms of potential impact. This isn’t very surprising surprising: there’s about the same amount of water around today as 4 billion years ago, but there 7 billion more people, on the way to 8 billion. More of them live in cities, often far from water supplies. And many have never had access to safe, abundant water.
The water industry has done a great job for the last 100 years. But the approaches that got us this far won’t properly serve us in the future. Because from now on, it gets worse – urbanization of the world shows no signs of letting up – from 34% of the world’s population in cities in 1960 to 54% in 2014. This means that water supply is colliding painfully with water demand in many parts of the world – both those without existing water infrastructure and those who have infrastructure that is not aging so gracefully. The World Resources Institute believes this situation may lead to not just environmental problems, but to social instability and political and military conflicts.
So how do we go about meeting this challenge? The traditional response has been on the supply side. Water is an industry without really being a business. It’s a legacy of all those engineers running the place: engineers love to build things – dams, aqueducts, treatment plants, desalination facilities. But there’s a problem with that approach. Supply side projects take years, sometimes a decade or more. And they are expensive: $100 million, $1 billion, more? Populations grow and shift faster than that. And not everyone can afford projects of that size.
The insight we had at WaterSmart was how to – as we say in Silicon Valley – “hack” the water problem. That is: how to come up with a disruptive approach that solves the core problem but avoids the barriers just described. We realized that the demand side of the equation was underserved and could be much more responsive, and a LOT less expensive.
So that’s what we do at WaterSmart every day: we help utilities and consumers to save water and save money. And we do so not with physical science and mechanical engineering, but with digital and behavioral science. We have built a digital platform “in the cloud”, as they say, that is part data analytics lab, part advertising agency, and part psychology experiment. And we use that platform to help utilities to do 3 important things:
- To better understand who uses how much water, when, where & why.
- We then enable utilities to communicate with & engage their end-consumers in the manner and frequency of their choosing. Whether web, mobile, email, text, voice, or print we can help utilities reach out to their customers on topics that matter most. That means building stronger relationships with them and help educate them on the value of water services.
- Finally, we help utilities to use this improved relationship along with data analyses and some behavioral science magic to “nudge” consumers towards more efficient patterns of behavior. Better for the consumer. Better for the utility. Better for the environment and society around them.
There are skeptics still out there, but the truth is that this stuff works, particularly when compared with physical science, supply-side projects. The Carlsbad desalination plant near San Diego, which began commercial operations at the end of 2015 cost $1B and took nearly 10 years to complete and provides only 7% of San Diego’s water supply. Behavioral programs of the type WaterSmart runs typically bend the demand curve by 4-7% over 1 year and cost less than $1M. So this is very real, very practical, and there is immense value in the data – a parallel, “virtual reservoir” if you like.
But we have much bigger plans to help change the way the world uses water. For major developed economies and the emerging world. For disadvantaged communities, where water is expensive and choices are difficult. For markets where water quality is problematic. Enabling new projects to get financed at the lowest possible cost. Making sure that we as a society can mitigate and adapt to climate change. Democratizing access to data that people need to make good decisions about the one resource that is truly irreplaceable for life on Earth.
But digital water raises a great possibility for our communities: can we use this kind of approach more broadly? Not just in natural resources, but in all kinds of scarcity? At WaterSmart, we would argue that it can, and that this intersection of the digital and behavioral sciences is uniquely suited to other problems… this is going to continue to be a very important story. And we deeply appreciate your help in telling this tale to those people you meet, and sharing our vision, so we can make access to clean, delicious water the basis of happy people, stable nations, and healthy environments.