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【Abstract】

70% of the earth’s surface is covered by water, yet water security is a growing issue. Modern water processing plants, though technologically advanced, are costly and not resilient in the face of higher demands, droughts, floods or reduced quality of raw water. A healthy ecosystem improves the quality of raw water and makes an area more resilient to climate events, thereby improving water security.

The UK already has an innovative water industry that expands its influence beyond its borders. Several water companies have developed inspirational initiatives that further embed sustainability into water services, some of which are discussed in this article. Upstream Thinking develops partnerships across the public and private sector to improve the ecology in catchment areas. EnTrade – a spin-off from Wessex water – converts the needs of industry into offset projects for local communities around the country. In addition, it funds more nature-based solutions by selling the diverse ecosystem benefits to multiple buyers using its multi-buyer, multi-benefit model.

Another water company, Yorkshire Water, developed a framework exploring the application of Circular Economy in the water industry and recognized the need for partnership across industry sectors. Through collaboration, they restored a redundant site and made use of other by-products such as heat and organic nutrients.

The multiple approaches point to the multiple opportunities available in this sector. Designed mindfully, these projects can be recreated worldwide to make our water safe for us and our planet.

（Image: Water treatment for reuse in the UK）

Main Highlights

• Water security is a major global issue. By 2025, 66% of the world’s inhabitants could live in water-stressed conditions.

• In the UK, water companies spend billions in water services, which includes extraction, processing and distribution of clean water to households and businesses nationally. Costs of water processing rise with increased pollution of waters nearby.

• Water services increasingly recognize the need to collaborate with stakeholders to reduce pollution without reducing beneficial development.
• Several water companies in the UK have developed solutions that go beyond water security and the role of water companies. Some of these examples in the UK include –

o Upstream Thinking – Improves upstream catchment areas through partnerships with farmers, regulatory bodies, researchers and more.

o Yorkshire Water – Developed a project with circular economy principles redesigned for the water industry.

o EnTrade – Developed offset markets for nature-based solutions with a unique multi-buyer, multi-benefit model.

• These sustainability-oriented solutions provide multiple social, environmental and economic benefits, both short-term and long-term.

Case Overview

According to the World Health Organization (WHO), water-borne diseases resulted in about 1.5 million deaths in 2019, and was the eighth-highest cause of death globally, particularly among lower-income groups. By 2025, 66% of the world’s inhabitants could live in water-stressed conditions. Water security is a major global issue and only a handful of countries have access to safe drinking water. The UK isn’t one of them. According to the Environment Agency’s framework for Water Resources, business-as-usual would mean that by 2050, UK will not be able to meet the demands of people, industry and agriculture.

In the UK, the water industry is privatized and 26 companies provide water and sewerage services to all households and businesses nationally. Water processing plants spend £5.17 billion in services and as much (£5.85 billion) in assets each year. Water service describes the entire range of assets and activities, including the extraction of raw water from surface and underground water bodies; transport of raw water; conversion of raw water to potable water via water treatment processes; and the distribution of treated water to customers. Water companies are eager to slash costs, sometimes unrightfully, while meeting the regulatory needs of clean water in the UK. The processing costs of converting raw water into potable water, which are a large part of the costs, depend on the quality of raw water, which in turn depends on the health of the natural ecosystem. Therefore, water companies have an incentive to invest in ecosystem restoration, but they are not the only ones. For example, the British government spends nearly £15 billion yearly on environmental protection measures, which includes waste management, climate, ambient air, biodiversity protection, R&D and administration costs.

The link between fresh, clean water at source and environmental health is quite ‘natural’ (no pun intended). Contaminations in raw water arise from industrial and agricultural activities within the catchment area. Water services regularly monitor water quality at the catchment level, and increasingly see the need to collaborate with stakeholders to reduce pollution without reducing beneficial development. But sustainable development is costly and benefits many stakeholders – stakeholders that can be part of funding the development. Some water companies have actively implemented collaborative solutions to enhance ecosystem health, for example, by using circular economy principles or by developing business models that invite new partners.

■Upstream Thinking
South West Water provides water and sewerage services in the South West region of UK. The idea was conceptualized in 2003, after an algal bloom in Upper Tamar Lakes resulted in eutrophication and caused problems for water supply and ecology downstream. Algal blooms are a result of nitrogen and phosphorous contamination in waters, often a result of fertilizer run-off from farms near the catchments. South West Water pioneered a whole-catchment approach to improving raw water quality – the Upstream Thinking project – in an effort to 1) stop run-off nutrients from entering the reservoir while supporting farmers, 2) avoid rising costs to their customers as a result of increased water processing, and 3) manage the impact of global warming on their business.

Upstream Thinking project is a multi-award-winning catchment management scheme which applies natural landscape-scale solutions to improve water quality and supply. The project is delivered through partnerships between the water company, landowners and tenant farmers, Westcountry Rivers Trust, Devon and Cornwall Wildlife Trusts, government agencies, environmental experts, as well as the University of Exeter which provides its research services to evaluate the change in water quality at catchment scale.

With early pilots on Exmoor and in the Tamar valley in 2006, catchment management is accepted as best practice by virtually everyone today, including the industry’s economic regulator – Ofwat. In its next 5-year plan (2020-2025), Upstream thinking will apply its successful scheme across 18 catchments encompassing 80% of South West Water’s drinking water catchments.

■Yorkshire Water
Yorkshire Water provides water and sewerage services to 5 million customers in the Yorkshire County in northern England. As part of their services, they invest to conserve and enhance the land in their catchments to improve the quality of water flowing into rivers and reservoirs and make river improvements where needed. In addition to reducing operational emissions as part of their climate change strategy, Yorkshire water have set 44 challenging targets for conserving the environment.

In 2018, Yorkshire Water’s Innovation department piloted an ambitious project to see how far they could get with Circular Economy principles. In this project, they developed and applied the ReSOLVE framework (Regenerate, Share, Optimize, Loop, Virtualize, Exchange). They aimed to regenerate an area that was made redundant by attracting partners and customers into the environment where they could deliver wholesale products for the partners to utilize for sustainable development. For example, their partners included a data centre that could make use of cleaned up effluents in cooling data centres, whereafter the heat collected could be delivered as a resource to another partner in the area. Other partners could use make use of nutrients, different grades of water, or exchange services between each other unrelated to Yorkshire Water’s services.

The results have outlined options for sustainable and resilient offerings like a vertical farm, a potable water production plant, housing and commercial land development, and an industrial innovation centre. Yorkshire Water is now considering how to incorporate these into its strategy and future growth plans.

■EnTrade
EnTrade is a spinoff from the Wessex water company, where it began by offsetting nitrogen for Wessex Water. To reduce or offset nitrogen contamination for Wessex Water, EnTrade invited farmers and landowners to provide offset services by voluntarily implementing various sustainable agriculture practices. By converting water industry needs into attractive opportunities for farmers, the farmers were more willing to change their agricultural practices. This approach saved Wessex Water £6 million in costs and led to a range of other ecosystem and biodiversity benefits for other stakeholders.

EnTrade’s portfolio includes projects on reducing nitrogen and phosphorus pollution, preventing soil erosion, specific biodiversity offsets (for specific species that are harmed in another project elsewhere in the country) and more. To support their online market, EnTrade has developed a tech platform to easily participate, offer, verify, and get paid for offset services.

Nature-based solutions benefit multiple stakeholders. To fund even more projects, EnTrade has developed a multi-buyer, multi-benefit auction. In this model, a project engages multiple partners who require diverse offset services thereby accumulating sufficient funds, and the services to meet the offset goals are provided by various partners too resulting in an equitable distribution of opportunities. To further enable farmers to join, EnTrade provides clear guidance on how an offset service can be provided.

Impact Statement
Population growth, energy crisis and climate disasters are some of the key challenges that contribute to water insecurity. Modern water processing plants, though technologically advanced, are costly and not resilient in the face of higher demands or challenges like reduced quality of raw water. Building a healthy ecosystem sustainably improves water security, reduces costs for water companies, provides co-benefits for the local community and contributes to climate action.

Solutions implemented by Upstream thinking and EnTrade develop partnership and new business models to fund ecosystem restoration in order to meet water security goals. These projects have saved water companies millions in costs and led to social and environmental benefits for the local community. In the long-term, these projects also contribute to climate action and urban resilience.

Yorkshire Water developed a framework to explore circular economy opportunities in the water sector, including restoration of sites and partnerships with other stakeholders to successfully implement circular economy solutions. When designed mindfully with a nature-first approach, this model can bring healthy jobs, sustainable transport, and services to an otherwise disused area.

Systems Perspective

Water – like food – effects a wide range of stakeholders, all of whom have different goals. Water sources are influenced by agricultural and industrial activities who also rely on water as a resource. Clean water is also important for the ecology – for the plants and animals that inhabit a natural environment.

The initiatives described in this article have taken a systems approach and built partnerships to reach short-term water-related goals and reduction in costs, but also affect long-term resilience of our water systems and long-term ecosystem restoration. The initiatives (particularly Upstream Thinking and EnTrade) replace the need to build technological assets with nature-based solutions. In addition to the environmental benefits of reduced water　pollution upstream of water processing plants, the projects create opportunities for the rural economy to participate in building a healthier ecosystem. This has further socio-economic benefits as farmers earn an extra income through offset projects or partnerships, improve their land through cover-crops and reduced fertilizer use, and can hope to have more resilient farms in the future.

For any project on sustainability, the devil’s in the details, which can be very difficult to analyze or altogether inaccessible. Offset projects can be designed with either an ecology-first or an economy-first mindset. When pushing for economic gains, projects can be falsely designed to maximize restoration claims without actually achieving them. This has been particularly true of many carbon offset projects, with varying degrees. With this in mind, another way to critically look at EnTrade’s multi-buyer, multi-benefit model is that it ‘oversells’ ecosystem restoration efforts to multiple buyers, thereby making it cheaper for companies to offset their impact. Upstream thinking and EnTrade do provide regular updates on their projects, and could further address opacity issues by using jargon-free language where possible and easier formats (videos instead of reports).

The application of Circular Economy principles in water by Yorkshire water has a similar limitation. The actual impact of restoring an area by building an industry/residential center may pose challenges of urban planning, such as emissions from construction, unsustainable food imports and increasing commute. Such projects need to be designed mindfully – keeping nature’s needs on top – and to truly try and give back to nature what we constantly take from it.

Links and Contact Information

・Upstream Thinking
– https://www.southwestwater.co.uk/environment/working-in-the-environment/upstream-thinking/

・Yorkshire Water
– https://www.yorkshirewater.com/

・EnTrade
– https://www.entrade.co.uk/