The Coming Water Crisis.
by Marianne
Lavelle; Joshua Kurlantzick; David D'Addio.
U.S. News & World
Report, August 12, 2002
The tap water was so dark in Atlanta
some days this summer that Meg Evans couldn't see the bottom of the tub
when she filled the bath. Elsewhere in her neighborhood, Gregg
Goldenberg puts his infant daughter, Kasey, to bed unbathed rather than
lower her into a brew "the color of iced tea." Tom Crowley is gratified
that the Publix supermarket seems to be keeping extra bottled water on
hand; his housekeeper frequently leaves notes saying, "Don't drink from
the faucet today." All try to keep tuned to local radio, TV, or the
neighborhood Web site to catch "boil water" advisories, four of which
have been issued in the city since May to protect against pathogens.
"We've gotten to the point where I'm thinking this is just normal,"
Evans says. "It's normal to wake up and take a bath in dirty water."
In a nation where abundant, clear, and
cheap drinking water has been
taken for granted for generations,
it is hard to imagine residents of a major city adjusting to life
without it. But Atlanta's water woes won't seem so unusual in the years
ahead. Across the country, long-neglected mains and pipes, many more
than a century old, are reaching the end of their life span. When pipes
fail, pressure drops and sucks dirt, debris, and often bacteria and
other pathogens into the huge underground arteries that deliver water.
Officials handle each isolated incident by flushing out contaminants and
upping the chlorine dose (Atlanta says its water meets health standards
despite its sometimes unappetizing appearance), but no one sees this as
a long-term solution. America's aging water infrastructure needs huge
new investment, and soon.
Decayed pipes alone would be a serious
challenge. Now, add these: Providing water free of disease and toxins is
ever more difficult, as old methods prove inadequate and new hazards
emerge. Shortages have become endemic to many regions, as record drought
and population sprawl sap rivers and aquifers. Then there's the threat,
unthinkable a year ago, that now seems to trump all others: terrorism.
Put it all together, and it's easy to see why concern over clean
drinking water might someday make the energy crisis look like small
potatoes.
"The idea of water as an economic and
social good, and who controls this water, and whether it is clean enough
to drink, are going to be major issues in the country," says economist
Gary Wolff, at Oakland's Pacific Institute for Studies in Development,
Environment, and Security. In March, Environmental Protection Agency
Administrator Christie Whitman called water quantity and quality "the
biggest environmental issue that we face in the 21st century."
Water providers say that Americans can
still trust the product on tap. "People should feel good about their
water. Water is safe and we're working hard to keep it that way," says
Thomas Curtis, deputy executive director of the American Water Works
Association. But the Natural Resources Defense Council's Erik Olson
detects a "schizophrenic" element in industry assurances. "They say we
need hundreds of billions of dollars to fix the system, but when people
ask, `Is there a public-health issue?' they say, `No, no.' But clearly,
there's a public-health problem."
Both the sanguine and the worried agree
on one thing: High costs will force the nation's water delivery system
to evolve into something quite different. Citizens will be asked to pay
more and use less. And big business, still a minor player in this
country's water scene, is seeking a leading role. Private industry
promises needed new capital and greater efficiency, but the jury is
still out on whether it can deliver. Witness, for instance, the plight
of Atlanta, which in 1999 became the largest U.S. city to privatize its
water system. Already the city is weighing whether to nullify its
20-year contract with United Water, a subsidiary of the French company
Suez.
Buried troubles. For now, issues of
ownership, infrastructure, and health have been back-burnered while
governments grapple with the threat of water system terrorism
Terrorism, however, cannot long postpone action on the fissures
spreading in the 700,000 miles of pipes that deliver water to U.S. homes
and businesses. Three generations of water mains are at risk: cast-iron
pipe of the 1880s, thinner conduits of the 1920s, and even less sturdy
post-World War II tubes. While refusing to call it a crisis, Curtis
says, "We are at the dawn of an era where utilities will need to make
significant investments in rebuilding, repairing, or replacing their
underground assets." Cost estimates range from EPA's $151 billion figure
to a $1 trillion tally by a coalition of water industry, engineering,
and environmental groups. The AWWA projects costs as high as $6,900 per
household in some small towns.
Health is at risk if nothing is done.
Already, water mains break 237,600 times each year in the United States.
An industry study last year found pathogens and "fecal indicator"
bacteria at significant levels in soil and trench water at repair sites.
Of the 619 waterborne disease outbreaks the Centers for Disease Control
and Prevention tracked between 1971 and 1998, 18 percent were due to
germs in the distribution system. Researchers also question whether
Americans are getting sick from their drinking water far more often than
is recognized. "Is this happening below the radar screen, with low-level
[gastrointestinal] things, where people will stay home from work, or be
miserable at work, and not ever go to the doctor?" asks Jack Colford of
the University of California-Berkeley. He is leading a major
EPA-CDC-funded study comparing disease rates between participants who
drink tap water through a sophisticated filter and those using a fake
look-alike filter. Harvard researchers reported in 1997 that
emergency-room visits for gastrointestinal illness rose after spikes in
dirt levels that still remained well within federal standards.
Quality concerns. Just keeping up with
federal regulations is increasingly difficult. The next five years will
see more new rules than have been adopted in all the years since
enactment of the Safe Drinking Water Act in 1974. Environmental
advocates blame the logjam on delays in addressing many health hazards.
The arsenic standard, which produced an uproar early in the Bush
administration, was years in the making. The EPA ultimately approved the
same standard President Bill Clinton chose in his last days in
office--reducing the arsenic limit from 50 to 10 parts per billion. The
change of heart coincided with a National Academy of Sciences report,
released to little notice the week of September 11. It indicated that
even the Clinton standard was weak: As little as 3 ppb arsenic carries a
far higher bladder and lung cancer risk than do other substances EPA
regulates.
New science has also undermined
confidence in older methods of purifying water. Chlorination has been
one of the 20th century's great public-health achievements, smiting the
deadliest waterborne diseases, cholera and typhoid. But this sword has
developed a double edge. Nearly 200 women in Chesapeake, Va., sued their
water system, claiming that miscarriages they suffered in the 1980s and
1990s are traceable to trihalomethanes, chemicals produced when chlorine
reacted with their region's murky river water. While pregnancy-risk
research is hotly debated, the EPA decided that cancer risk from
chlorine by-products is high enough that it ordered water system
reductions earlier this year. Localities have already spent millions of
dollars converting to another disinfectant, chloramine (a chlorine and
ammonia mix), which curbs some byproducts.
Cities and towns are finding
that they must deal with new science on contaminants at a much faster
pace than the EPA can regulate them. This summer, Bourne, Mass., the
southern gateway to Cape Cod, had to close three of its six drinking
water wells, having discovered they were contaminated with perchlorate,
a rocket fuel component that leaked from a nearby military reservation.
Across the country, the Metropolitan Water District of Southern
California, serving 17 million people, announced in April that its new
treatment system "will remove a large portion of perchlorate" leaking
into a major regional reservoir, Lake Mead. But U.S. News has obtained
material distributed at a June 11 MWD board meeting showing the
treatment was not working as hoped.
The EPA is still studying
possible drinking water limits for perchlorate as well as for MTBE, a
gasoline additive meant to reduce air pollution that proved to be a
frighteningly efficient groundwater pollutant. (South Tahoe and Santa
Monica, Calif., last month obtained big settlements from oil and
chemical companies to help restore MTBE-poisoned water supplies.) And in
April, a U.S. Geological Survey report revealed that streams nationwide
are laced with prescription and over-the-counter drugs and even
caffeine.
Pollution is shrinking water supplies
for communities at the same time that burgeoning population and weather
are causing severe shortages. Norman, Okla., with 95,700 people the
largest system currently afoul of arsenic standards, very likely will
shut down some wells even though it expects average daily water demand
to more than double in the next 40 years. "We don't want to be a poster
child" for arsenic contamination, says utilities director Brad Gambill.
This summer, more than 40 percent of the nation--over twice the normal
rate--has suffered drought conditions. "Normally, we get tons of
flowers, but now we have nothing growing," says Donna Charpied, a farmer
in Riverside County, Calif., pointing to withered plants on her small
homestead. Some ecologists
believe global warming will make drought the norm in much of the West.
Drought breeds anger: The CIA predicts that by 2015, drinking-water
access could be a major source of world conflict.
Some cities have already instituted
drastic conservation programs. Santa Fe has restricted lawn watering,
leading New Mexicans to decorate yards with spray-painted artificial
flowers. In parched Denver, a conservation campaign encourages residents
to shower in groups. Omaha has an odd-even residential address
lawn-watering program.
One spring Saturday morning this April,
Chuck Maurer of San Antonio realized while brushing his teeth that he
and his neighbors had become victims of a water conservation program
gone awry. "It was grotesque," he recalls. "The water was brown in color
and cloudy with particulates, and a really bad odor. It was sewer
water." Precisely. The San Antonio Water System had accidentally
cross-connected his neighborhood's drinking water lines with pipes
delivering treated sewage water to a public golf course. Watering
fairways and greens with "reclaimed water" has become popular in
water-short tourist areas, especially Florida. But experts say such
systems require extra care to keep sewage from entering potable systems.
Big business to the rescue. With immense
challenges ahead, U.S. drinking water systems are considering something
never tried here on a large scale: privatization. In March, Indianapolis
announced a $1.5 billion agreement with USFilter, the largest U.S.
privatization to date, and in May, San Jose, Calif., voted to consider
privatizing. Private firms helped supply water to Boston as early as
1796, and utilities have long hired outside contractors to build, but
not operate, plants and distribution systems. But over the past five
years, an IRS ruling that helped firms obtain longer-term tax-free water
contracts, combined with politicians' push for deregulation and
municipal-system breakdowns, opened the door for firms to actually
manage systems. Only 15 percent of utilities are investor-owned, but in
recent years, a handful of big water corporations, mostly foreign owned,
have moved onto the U.S. scene: from France, Suez and the media-water
conglomerate, Vivendi; from Germany, the utility RWE. (One domestic
player with giant ambitions was Enron's water subsidiary, Azurix, which
had touted a plan to plumb the Everglades and manage the water.)
Congress is considering hiking federal
funding for infrastructure, but the Bush administration encourages the
privatization trend, saying that water systems cannot expect to get all
the dollars they need from Washington. Says G. Tracy Mehan, EPA
assistant administrator for water: "I think the needs are so great
especially when you see the demands of homeland security and the federal
budget. Private capital is one of several options that are going to have
to be considered much more than they have been."
One private-sector success story is
Leominster, Mass., a town of 40,000, which signed a 20-year deal with
USFilter in 1996. Before then, "our treatment plant was totally
corroded. We fixed leaks by putting out old coffee cans to catch the
water," says Mayor Dean Mazzarella. USFilter saved the city money it
then used to upgrade a 60-year-old filtration plant that was "held
together by wire and chewing gum," says city environmental inspector
Matthew Marro.
Experience in other countries suggests
that privatization can, indeed, pour needed capital into drinking water.
Investment in the United Kingdom increased more than 80 percent after it
turned to total privatization. "Public-private partnerships are going to
sweep the U.S," says Andrew Seidel, president of US Filter. "The country
has 50,000 different water systems, and those will consolidate into
bigger systems aligned with private companies and able to handle the
growing number of water-treatment issues."
But in Atlanta, the experience
has not been so positive. This summer, Mayor Shirley Franklin sent a
formal notice to United Water that the city was dissatisfied with its
performance under the 20-year contract signed with the city's previous
administration. Problems cited by Franklin included the firm's staffing
levels, bill collection, and meter installation. Atlanta had hoped to
halve the $49 million annual cost of running its water system by
privatizing; one city official says savings are less than $3 million.
"You have to keep in mind that a public-private partnership is an
ongoing dialogue between the customer and its private partner," says
United Water spokesman Rich Henning. "We certainly have struggled. But
within the last six to nine months we have dedicated more resources, and
we've been listening more to the client." He calculates Atlanta's
savings to be about $15 million a year but says the city should be using
that money to address the infrastructure problems that United Water
inherited.
Gordon Certain, president of
the civic association of North Buckhead, the neighborhood hardest hit
with water-quality problems, says United Water is unresponsive to
complaints. "They're acting kind of like they have a 20-year contract,"
he says, wryly. (Of course, they do.) The company's response to
complaints has ranged "from polite to totally inappropriate," he says.
"They told one woman who wanted her water tested that she should get it
tested herself." But resident Jacques Davignon thinks privatization "has
only made the finger-pointing much more complex." He says the company
and the city should share responsibility. "Let's not get on TV and beat
United Water up," he says. "Let's do a little forward thinking, come up
with a strategic plan."
Private enterprise also has rushed in
with water-shortage solutions. The agribusiness firm Cadiz Inc. wants to
store water in the barren Mojave Desert, where tidal waves of dust sweep
across salt-rimmed dry lakes. The water, taken from the Colorado River
and from an indigenous underground aquifer, would flow to thirsty Los
Angeles during droughts. "Storing and selling aquifer water will be the
key to California's future," says Mark Liggett, Cadiz's senior vice
president.
Jim Andre, a desert biologist working in
the Mojave, says Cadiz has no impartial scientific study of the
potential impact. Environmental groups warn that drawing groundwater
from the Mojave will create a dust bowl similar to California's Owens
Lake region, a water grab that inspired the film Chinatown. But Cadiz
says it has a monitoring system to prevent overpumping. "We have
solicited tons of input from all groups for our environmental
assessment," Liggett says.
Creative solutions. Other ideas seem
somewhat fanciful. Ric Davidge, a former Reagan administration official,
wants to siphon 10 billion gallons of water each winter from northern
California rivers, pump it into 850-foot-long plastic bladders, and ship
it downstate. Other entrepreneurs suggest melting Alaska icebergs.
Oilman T. Boone Pickens hopes to pipeline water from Texas's Ogallala
aquifer to water-short cities like San Antonio and Dallas.
Privatization projects are also dogged
by accountability concerns. Industry sources worry that the terrorism
vulnerability assessments U.S. water systems are developing will wind up
in corporate parent offices overseas, possibly unprotected from
disclosure. In New Orleans, an official highly familiar with its water
system told U.S News that the Big Easy's move toward privatization lacks
oversight. "The whole approach to having companies bid for the water
system was `public, catch us if you can,' since after bids were taken
the public had only 10 days to examine the proposals," she says.
Privatization worries have even
made it to Broadway: In the comedy Urinetown, a firm privatizes toilets
and raises toilet fees. Residents caught urinating in other places are
arrested. "With private control, who guarantees that the less well off
will get affordable water, and who picks up the cost if the private
company fails?" asks Sandra Postel, director of the Global Water Policy
Project, a research institute in Amherst, Mass.
Progress report. Indeed, the financial
viability of some leading water companies has been called into question
recently. Cadiz lost $2.5 million in the most recent quarter; the firm
recently tried to reduce its debt through a deal with Saudi Prince Al
Waleed ibn Talal, but in July the effort collapsed. Suez's water arm saw
revenues grow by just 1 percent. Vivendi, though experiencing revenue
growth of 12 percent, made major missteps in its media division that
have left it laden with debt and is divesting its stake in one water
investment, Philadelphia Suburban.
Nor have private companies, by
and large, delivered savings to consumers. In fact, most private water
providers surveyed by U.S. News charged higher-than-average rates
(table). George Raftelis, a Charlotte, N.C., industry consultant, points
out that unlike public utilities, private firms do not enjoy tax-exempt
financing, are subject to income taxes, and must return profits to
shareholders. Moreover, "privatization does not equal competition," says
Janice Beecher, director of the Institute of Public Utilities at
Michigan State University. "After bidding, you're transferring the
monopoly powers of a public utility to a private company." She suggests
cities and towns award shorter contracts and make public utilities and
private firms compete.
Citizen outcry over the water rates
private firms charge has boiled over into riots in countries such as
Bolivia. But so far in the United States disputes have been hashed out
in the political process. Peoria and Pekin, Ill., both are moving to
deprivatize their water systems, having determined that if private
ownership continued, future rate increases would be as much as 60
percent higher than if the systems were publicly run. Because other
communities have done the same, Curtis of AWWA does not see a mass
movement to privatize: "Some are looking at it, and some are trying to
move in the other direction."
But the harsh reality is that the price
of drinking water will most likely rise whether private industry or
government manages the system. The EPA estimates that the water bill
consumes only seven tenths of 1 percent of U.S. household median income;
Americans spend more than triple that on bottled water and filters. A
recent Harvard School of Public Health analysis pointed out that rates
in many developed countries are significantly higher. "[W]ater rates
have been insufficient to cover long-run costs," such as maintenance of
pipes and plants, let alone larger issues such as preserving clean
rivers and surrounding watershed, the report said.
"People think water is free because it
falls from the sky," says Seidel of US Filter. "Well, it is--but treated,
filtered, and piped water isn't." Privatization advocates contend that
only market-oriented pricing can force H2O-hogging Americans to
conserve. "Unless you put a market-determined price on something, it is
not respected," says Clay Landry, a research associate at Bozeman,
Mont.'s Political Economy Research Center. "Right now, who even thinks
about the cost of water coming out of their tap?"
But public officials are loath to hike
rates for fear of burdening lower-income families. That's certainly a
problem in big cities, but even more so in small towns, where, lacking
economies of scale, water treatment and distribution is more expensive.
Consultant Raftelis found that water bills in small systems average 25
percent higher than in large ones he has surveyed. The new arsenic rule
is projected to cost households under $1 annually in the largest systems
but over $300 in those serving fewer than 100 customers.
Economist Wallace Oates of the think
tank Resources for the Future says arsenic's economic realities make a
case for abandoning national standards and letting localities weigh
costs and benefits on their own. Congress and the EPA already let small
water systems operate with less regulation and enforcement--some will
have 14 years, instead of four years, to meet the new arsenic rule. The
Bush administration is studying whether to relax small-system standards
even more. Yet all but a fraction of health violations occur in small
systems, which serve some 50 million citizens.
"What you have is a two-tier drinking water system, and that's pretty
troubling," says NRDC'S Olson. He argues that health and efficiency
require a major consolidation among the 54,000 U.S. water suppliers.
Says EPA's Mehan, "Citizens and systems are going to have to look at
this option."
Turning off the tap. Citizens are
certainly looking at other options, but less with an eye to changing the
system than to just protecting themselves and their families. "We're
looking at having a plumber put a filter on our entire house," said
Atlanta resident Davignon. In the meantime, he buys bags of ice and
water from the supermarket, adding, "I hate to pay for water, but if
it's undrinkable, or the kids can't bathe, you do it." Already, 76
percent of Californians rely on bottled or filtered water. "We have
reached a breaking point beyond which central treatment can no longer
go," says Peter Censky, executive director of the Water Quality
Association, which represents filter makers. Joseph Cotruvo, a former
EPA water administrator, agrees: "You wouldn't think of drinking orange
juice out of a pipe, would you? I wouldn't be surprised if 25 years from
now the thought of drinking water as a beverage rather than a commodity
will dominate."
The drive toward bottled water and
filters will, however, widen the gap between haves and have-nots, a
result some hope technology can prevent. "[G]oing into the 21st century,
you can't get the kind of long-term improvements in water quality that
are needed without the next generation of technology," says Olson. A few
U.S. water systems are trying disinfectants used in Europe: ozone,
ultraviolet light, and perhaps the best purifier (used by bottlers Pepsi
and Coke), reverse-osmosis membrane technology. "It removes just about
everything," says Olson, "so you don't have this
contaminant-of-the-month approach."
And yesterday's clean water may
not be clean enough for the future. L. D. McMullen, chief executive
officer of the Des Moines water system, believes as the population ages
and more people have compromised immune systems, cities and towns will
have to provide water much lower in contaminants than they do today. "We
will totally have to deliver water to customers in a totally different
way," he says. "You may see what I like to call `neighborhood polishing
units,' that develop ultrapure water in the neighborhoods and deliver it
to homes" through much smaller pipe systems. Households need relatively
little superclean water, McMullen points out, since less than 15 percent
of "drinking water" is drunk or bathed in. Most goes to flushing toilets
and watering lawns.
Des Moines has learned from experience
that its citizens will pay for such improvements: In 1992, the city
raised water rates 25 percent to build the world's largest removal plant
for nitrate, an agricultural runoff that can reduce infants' oxygen
uptake (blue-baby syndrome) and cause other ills in adults. But whether
public water systems tackle their challenges on their own or turn the
job over to private enterprise, or some combination, the changes ahead
will require a revolution in how Americans think about drinking water.
"People's knowledge of water comes from beer commercials, focused on the
land of sky-blue waters, or mountain springs and aquifers underlying
some Wisconsin hillside," says Censky of the Water Quality Association.
"The public thinks water in these sources is pure, but it's not. Really,
pure water is a man-made product."
Pathogens
Source: sewage discharges and
farm runoff can introduce E. coli bacteria, cryptosporidium, and other
harmful microorganisms.
Problems: gastrointestinal
illness, severe in people with weak immune systems.
Hot spots: New Haven, Mich.,
San Antonio; any place with treatment or pipe system breakdowns
Arsenic
Source: occurs naturally in
groundwater, and sometimes as a residue of mining and other industrial
operations
Problems: a strong poison at
high doses; at low doses linked to cancer, diabetes, and other diseases
Hot spots: Albuquerque, N.M.,
Norman, Okla., towns throughout the Southwest
MTBE
Source: a fuel additive
designed to reduce air pollution that has turned into a swift, efficient
groundwater polluter through spills and storage tank leaks
Problems: stomach, liver, and
nervous system effects, possible cancer risk
Hot spots: Pascoag, R.I., Santa
Monica, Calif., New Hampshire.
Perchlorate
Source: a component of solid
rocket fuel, munitions, and fireworks; has leaked from at least 58 U.S.
military bases and manufacturing plants
Problems: interferes with
functioning of the thyroid gland Hot spots: Riverside, Calif., Bourne,
Mass.; contamination confirmed in 20 states.
THMs
Source: trihalomethanes form
when chlorine reacts with organic material, from decayed leaves to
feces, in water; extremely common contaminant.
Problems: linked to bladder
cancer, with some evidence of miscarriage risk.
Hot spots: Waco, Texas, and the
Washington, D.C., suburbs.
What do Peoria and Paris have
in common?
In the United States, consumers
pay above-average rates in many water systems run by private companies,
a sampling of quarterly bills shows.
PRIVATE U.S. SYSTEMS QUARTERLY BILL
Peoria, Ill. $100.17
Bloomsburg, Pa. $94.69
Hoboken, N.J. $88.50
Camden, N.J. $74.42
Atlanta $51.00
Jersey City, N.J. $49.80
U.S. average
(public and private) $47.50
Leominster, Mass. $44.70
Corvina, Calif. $35.80
Sources: Raftelis Financial Consulting, 2002 Water and Wastewater Rate
Survey, U.S. News research
U.S. water rates are low compared with those of other countries, but
that
could change if localities begin to address water system problems.
CITY QUARTERLY BILL
Paris $171.80
Osaka, Japan $115.39
Vienna $97.02
Hong Kong $88.73
United States $47.50
Riga, Latvia $27.05
Sofia, Bulgaria $16.49
Buenos Aires $10.72
Palmerston North,
New Zealand $5.48
Source: Raftelis Financial Consulting, 2002 Water and Wastewater Rate
Survey. Rates are for 22,450 gallons, typical quarterly U.S. household
water use.