PA Consulting (PA), the consultancy that's bringing ingenuity to life, publishes first of its kind research which reveals that leading global organisations could save 86 billion cubic meters of water – equivalent to the yearly water consumption of Japan – and reduce greenhouse gas emissions (GHG) by 12 million tonnes by 2030. This would provide up to a quarter of the annual GHG emissions cuts needed between now and 2030 to reach the 1.5 °C global temperature climate goal set out in the Paris Agreement.
PA's report, 'The big drop: The untapped potential of water on decarbonisation', surveyed leaders from 73 global organisations across sectors where water demand is intensive: drinks, fast-moving consumer goods, high-tech manufacturing, traditional manufacturing, and pharmaceuticals. Almost all respondents said it would be possible to improve water efficiencies by at least 5%, and 36% said they could increase water efficiency by 10-19%.
Key findings from the report show that:
Across all sectors, the potential extrapolated total water saving would result in 12 million tonnes GHG reduction, which could provide up to one quarter of the 7.6% annual GHG emissions cut needed between now and 2030 to reach the 1.5 °C global temperature climate goal set out in the Paris Agreement.
Organisations face real challenges in improving awareness of the potential of water on decarbonisation, with just one fifth of respondents (22%) extremely aware of the relationship between water and carbon.
Over a quarter (28%) of leaders were either not at all aware or only slightly aware of the relationship between water and carbon. More than two thirds (68%) did not understand their organisations' water usage importance by region or country and 39% did not understand where water usage is highest across their supply chain.
More than a third of businesses (38%) say it's too difficult to know where to target action to achieve the biggest reduction in water usage and the associated carbon footprint.
Over a third (35%) of leaders said the other barriers to driving improvements included the low uptake of new technologies, difficulties accessing the right data from across the supply chain, and a lack of incentives and support from government.
To address these issues, global leaders need to treat water as a high priority – looking to access water in greener ways, using less water and reducing their carbon footprint from water use. To achieve results leaders should:
- Understand their water and decarbonisation challenges and opportunities.
- Determine greener ways to access water.
- Innovate for water and energy efficiency.
- Green your core business strategy and partner for everything else.
Jonquil Hackenberg, head of climate response at PA Consulting, says: "Collaboration is key to solving our global water and carbon challenges. There really is a virtuous circle where reducing water consumption and using water more efficiently reduces energy use and costs, resulting in lower carbon emissions and wider benefits to the environment. To progress further, faster, it's imperative that leaders treat water as a high priority area of opportunity and think about the water-carbon relationship holistically across the entire supply chain
"But it will require focused attention on sustainability strategy and focus areas, in improving data, implementing and scaling new technologies such as green desalination, and looking into opportunities to partner and collaborate to achieve greater value and impact. Organisations can start small by investigating new and existing solutions that could easily slot into their water and carbon strategy, or they could take inspiration from the consumer sector which is ahead of the curve when it comes to delivering water efficiencies in design and product. The big carbon drop will only come through cleaner, greener, smarter water use and progress."
Download a copy of the report
Methodology
PA conducted qualitative research with leaders from organisations in the following sectors: drinks, fast-moving consumer goods (FMCG), high-tech manufacturing, manufacturing, and pharmaceutical. They operated across Africa, the US, South America, the UK, the Nordics and Australasia. We also surveyed water companies. Half of our respondents had annual revenues of at least £1 billion. We looked across each organisation's value chain, to examine water use across four common processes: plan and source; make; deliver; return. The bulk of our findings were based upon the results of in-depth analysis of 52 respondents from larger multi-nationals. We also factored in observations from additional analysis of 21 organisations of smaller revenue size (below £10 m) to ascertain whether the challenges were the same and to unearth further opportunities.
To understand how the water efficiency targets indicated by our respondents translated to wider water-carbon reductions, PA identified average water usage from published company reports (dating no further back than 2019) of the four largest global organisations in these sectors. We extrapolated the approximate sector impact using an uprate factor based on the share of market revenue of companies in each sector. Then, we calculated potential GHG emission savings across the sector using the UK Government's most recent GHG emission factors for water use as an indicative benchmark.