Conservation will be the new ethic. It's the only way, really, given that freshwater is a limited resource and costly to transport for any distance, unlike other natural resources. Higher prices will be a motivating factor. Consumers, both business and residential, will pay more. In some places, they'll pay a lot more with rates that escalate as use increases.
There will be limits on use, some of them by government mandates, as is the case in several California counties already. But most communities with less severe water issues will rely on pleading, cajoling or tax incentives to cut water usage.
Water technology companies will thrive. Sales of equipment for filtration, ultraviolet oxidation and vapor compression, for instance, will rise 15% annually for five years and probably beyond, up from about $1.8 billion today. Leading manufacturers of the equipment, as well as manufacturers of water-efficient appliances, include CH2M Hill, Separation Dynamics, Siemens, EZ Environmental Solutions and SETS Systems.
Watch Australia. When it comes to water, Australia's present may be our future. Climate changes that occurred there about a dozen years ago that dropped the country's average annual rainfall in half forced the nation to adopt among the most innovative conservation projects, substantially reducing per capita water use. Several Australian firms that flourished with their country's programs are also well positioned to benefit from an expanding U.S. market. Among them are Perpetual Water, which makes on-site and in-home water recycling systems, and Caroma, which specializes in highly water-efficient bathroom fittings and accessories.