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How can the European water sector benefit from the digital revolution

About the blog

Emanuele Quaranta
Scientist & Hydropower expert for European Commission, Joint Research Centre, Italy.

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  • How can the European water sector benefit from the digital revolution

Water demand is continuously increasing on the back of a steadily growing population and economic growth. The availability of water per capita has already dropped by 24% and water scarcity affects almost 20% of the European Union (EU) territory. In the EU, the average national water losses in water distribution networks (WDNs) are 23%. Combined-sewer overflows result in billions of cubic metres of wastewater per year entering surface waters in the EU. There is also concern about the effect of new dams on biodiversity and water quality. Therefore, there is now an established awareness of the importance of water conservation strategies.

Digital technologies can play a relevant role in this context, with technical, economic, environmental and social benefits. Digital technologies delivered about EUR 300 billion in capital and operating expenditure savings in the global drinking water and wastewater industry in 2016 –2020. Closely related to the digital revolution is the emergence of new applications for Big Data technologies, that combined with artificial intelligence (AI) and machine learning can better support data-based decisions with high accuracy and less computational cost. However, digital technologies and the use of digital data may also impact water resources. Future projections for 2030 foresee that data usage will likely increase water consumption from 0.3 m3 (in 2022) to 1.1 m3 (in 2030) per person per year, and energy consumption of data centres from the 2020 average of 54.9 kWh to 226 kWh by 2030 per person per year in OECD Europe (approx. 3% of the EU average for electricity consumption per capita in the same region), whose corresponding cost is EUR 19.7 per person per year. Data usage and consumption are also associated with consumption of the critical raw materials needed to produce the electronics. Therefore, there is a need to better understand the benefits and impacts of digital technologies in all sectors including in the water sector, and to propose new solutions to improve them and to implement them more effectively.

Digitalisation delivered about €300 bn in capital and operating expenditure savings in the global water and wastewater industry (2016 –2020)

The exploratory and preliminary study Quaranta et al. (2023) explored some of the market opportunities for digitalisation in the EU, focusing on three water sectors: WDNs, combined sewer systems and hydropower plants, which represent a small proportion of the sectors where digital technologies already are or could bring benefits. The economic benefit of applying a range of digitalisation technologies (more details in the reference list of the full paper) in these sectors was estimated at EUR 5.0, 0.14 and 1.7 billion per year, respectively. Environmental and social benefits (e.g. for water quality and health), which could be significant, were not included in this study because they are very complicated to estimate in a large-scale study. The benefit per person ranged from 1.1 EUR/person/year (Belgium) to 59.1 EUR/person/year (Sweden), with an overall average EU aggregated value of 13.2 EUR/person/year (including the UK). The full article also discusses a future where water might become more scarce and digital technologies more efficient.

 The benefits quantified above, to only those three analysed sectors, would cover most of the costs associated with water usage by data and digital technologies, so it is reasonable to conclude that the overall benefits (when considering all sectors) would, in general, outweigh the costs.

The Digital Decade policy programme 2030 of the European Commission sets up a monitoring and cooperation mechanism to achieve the common objectives and targets of Europe's digital transformation. Each year the European Commission will publish the State of the Digital Decade report in which it will measure and assess the progress made towards the EU-level trajectories and the ultimate Digital Decade targets and recommend further actions and efforts, where needed. Each Member State will define its own national trajectories to contribute to the EU-level trajectories and targets.

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