Introduction to the water-energy nexus

The fuels or technologies used to achieve the clean energy transition could, if not properly managed, increase water stress or be limited by it. Some low-carbon technologies, such as wind and solar PV require very little water, others, such as biofuels, concentrating solar power (CSP), carbon capture, utilization and storage or nuclear power are relatively water-intensive.

IEA analysis found that an integrated approach focused on tackling climate change, delivering energy for all and reducing the impacts of air pollution (Sustainable Development Scenario) results in lower water withdrawals in 2030 relative to today and other scenarios thanks to the increased deployment of solar PV and wind, a shift away from coal-fired power generation and energy efficiency. However, consumption in this scenario increases by 50% relative to today.

Water scarcity is already having an impact on energy production and reliability; further constraints may call into question the physical, economic and environmental viability of future projects. IEA analysis found that increased water stress has a material impact on the cooling technologies (and related costs) deployed across China’s coal-fired power fleet. Additionally, forthcoming IEA analysis on hydropower in Africa will underscore the importance of putting in place technical and policy measures necessary to enhance the resilience of hydropower.

On the other side, diminished freshwater resources can lead to a greater reliance on energy-intensive sources of water supply such as desalination. In the Middle East, desalination’s share of total final energy consumption increases from 5% today to almost 15% by 2040.  

The largest increase comes from desalination, followed by large-scale water transfer and increasing demand for wastewater treatment (and higher levels of treatment). Electricity consumption rises by 80% by 2040. However, there is significant potential for energy savings in the water sector if all the economically available energy efficiency and energy recovery potentials in the water sector are exploited. Wastewater contains significant amounts of embedded energy that, if harnessed, could cover more than half of the electricity needs of municipal wastewater utilities. There is also a major opportunity to reduce water losses along the supply chain - from leaks, bursts and theft- which would save water and energy.

Billions of people today lack access to clean drinking water and sanitation and 80% of wastewater is discharged untreated. Energy is an essential part of the solution. IEA analysis shows that achieving universal access to clean water and sanitation (SDG 6) would add less than 1% to global energy demand in the Sustainable Development Scenario by 2030 and highlights a range of potential synergies between SDG 7 and SDG 6. For example, in rural areas, almost two-thirds of those who lack access to electricity also lack access to clean drinking water. As a result, considering water supply needs when planning electricity provision can open different pathways for both and lower the cost of electricity for households.