This week I got an e mail in from Sustainable Asset Management (SAM) and their statistic of the month was:

“The production of one cup of tea from start to finish requires on average 35 litres of water. “

Initially that surprised me but when I thought about it, it made sense and it got me thinking about how we now need to view water as a limited resource no matter where you live.

We all know the global population continues to boom and global warming is becoming more of a reality so it is obvious that pressure will mount on water resources that are already under enormous strain. Sure this is why some people are now calling water the new “Blue Gold”.

Even in Ireland where it appears to rain for the majority of the year we are experiencing water shortages. Think back to last winter when we had the very cold spell and remember the damage that was done to all the underground pipes that transport the water from the reservoir to our homes. Water was escaping out of the pipes faster than we could replace it so the authorities had to turn off the water supply in many areas.

So even in a country like Ireland, governments and consumers are becoming increasingly aware that water is a precious resource that needs to be managed in a sustainable way. Well that’s all well and good but as a consumer and an investor what does that mean to you.

Over the coming years governments are going to have to introduce tougher environmental standards to ensure sustainable management of water resources across the world. So it doesn’t matter if you think you have an abundance of water or if it is a rare commodity each government will have to take a strict stance.

Tougher demands on water quality, more public spending on infrastructure construction and maintenance as well as fixing of tariffs and fees will have a significant impact on the growth of individual segments of the water market.

Technologies that promote more efficient use of water are already available, water saving domestic appliances, efficient industrial plants or low cost methods or repairing pipes are just some of the practical ways investors can invest in water but as the demand grows greater, there will be many more interesting opportunities for long term investors.

I attach a recent presentation from Sustainable Asset Management which I hope you will find interesting.

If you have any questions please let me know as we are always delighted to help.

Best wishes,

Killian

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