Dow Chemical’s Sewage-to-Water Business

Bloomberg has a feature up today about Dow Chemical’s Water Division and the broader efforts to turn sewage into a safe and acceptable source for water reuse, up to and including human consumption:

Recycled wastewater will probably be the single largest source of water for California over the next quarter century,” says Tim Quinn, executive director of the Association of California Water Agencies. “And it isn’t just happening here—the same goes for many water-strapped regions of the world.” San Diego recently announced plans to produce 33 percent of its water from recycled sewage by 2035, up from none today, and is designing a toilet-to-tap facility even bigger than Orange County’s. Governments in Australia, China, India, Israel, and Spain, and throughout the Middle East and sub-Saharan Africa have developed recycled wastewater systems for irrigation; many are beginning to convert their systems to make drinking water. Singapore has the largest program, producing a third of its potable water from sewage.


Importing water to places like Southern California and Texas has historically been cheap, but with climate change, extended droughts, and increasing stress on rivers and lakes, the economics of water are changing. Virtually every city in the world has to start rethinking the foundation of its water supply. “Not every city has an ocean, not everyone has good lakes and rivers,” Desai says. “But everybody’s got sewage.

From a technological perspective, the write-up focuses mainly on applications for RO membranes (with a Dow bent, of course).

Importantly, the discussion also acknowledges another part of the problem – the social, user-acceptance, side:

There’s one lingering hitch: the gross-out factor. Even given the desperation of drought, drinking your own waste is nobody’s first choice. “Accepting recycled wastewater is kind of like being asked to wear Hitler’s sweater,” says Paul Rozin, a social psychologist at the University of Pennsylvania who’s researched consumer response to toilet-to-tap programs. “No matter how many times you clean the sweater, you just can’t take the Hitler out of it.”

Electricity Generation in Germany

National Geographic delves into the changing energy landscape of the world’s fourth largest economy:

Germany is pioneering an epochal transformation it calls the energiewende—an energy revolution that scientists say all nations must one day complete if a climate disaster is to be averted. Among large industrial nations, Germany is a leader. Last year about 27 percent of its electricity came from renewable sources such as wind and solar power, three times what it got a decade ago and more than twice what the United States gets today. The change accelerated after the 2011 meltdown at Japan’s Fukushima nuclear power plant, which led Chancellor Angela Merkel to declare that Germany would shut all 17 of its own reactors by 2022. Nine have been switched off so far, and renewables have more than picked up the slack.


German politicians sometimes compare the energiewende to the Apollo moon landing. But that feat took less than a decade, and most Americans just watched it on TV. The energiewende will take much longer and will involve every single German—more than 1.5 million of them, nearly 2 percent of the population, are selling electricity to the grid right now.

As is usually the case with National Geographic, the piece features some stunning photos which are worth the click alone.

The article closes by putting the German case in the context articulated by William Nordhaus in his piece for the American Economic Review earlier this year.

Because it’s a global problem, and doing something is costly, every country has an incentive to do nothing and hope that others will act. While most countries have been free riders, Germany has behaved differently: It has ridden out ahead. And in so doing, it has made the journey easier for the rest of us.

I’ve mentioned the Nordhaus piece before.

Whitepaper on Water Risk Valuation

There’s an interesting new whitepaper up on a tool put together by some people at Bloomberg and UNEP’s Natural Capital Declaration. This follows on from a similar approach to the valuation of carbon risk done in 2013.

Water is a critical natural capital factor that underpins many industrial processes. Water scarcity is therefore emerging as a potentially material risk for business, particularly for companies that operate in water stressed regions and water intensive industries such as mining.

The most recent Ernst & Young ranking (in 2014) of the top 10 business risks facing the mining and metals industry included – for the first time – “access to water,” explaining that the availability of affordable water is “an essential part of operations…and has become increasingly difficult.” 2 With competition for water expected to increase and the long lifespan of a typical mine, there is a strong case for systematically factoring water risks into the market valuation of mining companies.

Along with growing recognition of the potential material impacts of water scarcity, the increasing availability of geospatial data makes it feasible to model out possible effects of water risk on revenues and/or costs. The Water Risk Valuation Tool (WRVT) was developed to address the often missing link between corporate environmental risk and financial value. The WRVT is the product of a collaboration between Bloomberg LP and the Natural Capital Declaration (a finance-led initiative managed by the UNEP Finance Initiative and Global Canopy Programme), with support from Bloomberg Philanthropies and the GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit). The WRVT is a practical, high-level demonstration tool that illustrates how water risk can be incorporated into company valuation in the mining sector using familiar financial modelling techniques. The methodology can also be adapted to other relevant sectors and refined to eventually support the creation of plug-and-play tools for market participants.

Desalination in California

Wired has a story about the renewed interest and use of desalination in California, which is currently facing increased drought pressure with little sign of relief on the horizon:

But now, with snowpacks at zero percent and reservoirs looking more like puddles, engineers in San Diego are preparing to hook up a new $1 billion desalinization plant that will provide enough water for 300,000 thirsty people each day.

Desalination, of course, has been intensively used for quite sometime in other places. The new plant (first proposed in 1998) comes amidst a broad renewal of interest in widening California’s water supply :

Santa Barbara’s mothballed plant will start running again after sitting idle for 23 years. Cambria, Calif., opened an emergency $9.5 million desal plant in November 2014, while Monterey County approved “atmospheric water generators” (just like Luke’s uncle ran on Tatooine) to supply water for some businesses and industrial parks.

The article also has the mandatory statement about heightened financial costs of desalination. Their ballpark numbers are a 1:1 rate of cost growth (i.e. a 7% shift to desal would raise the cost of supply about 7%) so California’s water bill is going to go up. They don’t talk about the growth in requirements on other infrastructure, but this is understood. The developers plan to mitigate some of the discharge problems by using the fact that warm water is a waste product of power generation:

The developers are building the plant next to a gas-fired power plant in Carlsbad, about 35 miles north of San Diego. That way it can take use some of the power station’s coolant water to dilute the salty brine discharge.

We’re likely to see more integration of infrastructure pieces like this.

The article closes with a brief mention of the work by a microfluidics research group at MIT to develop single-layer graphene membranes.