Can you invest in desalination?
It's not easy to invest in water desalination. Desalination is a small business for many industrial conglomerates or water utilities. For example, Veolia, the world's desalination leader, is also a water and wastewater utility. Desalination companies like Israel's IDE Technologies are private.
Expensive Water
The nonpartisan research group recently issued a lengthy report on the state of desalination in California. Beyond the environmental cost is the actual price tag: the plant in Carlsbad cost $1 billion to build, with a rough estimate of $50 million a year for the power to run it.
Water stocks are stocks of companies whose business is closely tied to irrigation, utilities, water treatment, or other water-related industries. One can invest in these by buying the stocks of individual companies, or by investing in a mutual fund or ETF with high exposure to water stocks.
Large corporations like GE (NYSE:GE) and LG have been vying to enter the market with their desalination plants projects.
In the United States, a similar situation is unfolding. After a prolonged drought between 2011-2015, California's investment in desalination solutions to supply fresh water to the state's dry south grew exponentially.
The United States currently has over 1,400 installed desalination plants with the majority being used to desalt brackish groundwater.
Saudi Arabia is the country that relies most on desalination – mostly of seawater. The US is in second place. It uses mainly brackish and waste water although later this year it will open one of the world's largest seawater desalination plants in Carlsbad, San Diego.
There are approximately 16,000 operational desalination plants, located across 177 countries, which generate an estimated 95 million m3/day of freshwater.
Current methods require about 14 kilowatt-hours of energy to produce 1,000 gallons of desalinated seawater. So we can conclude that cost of distillation is high because we need notable large amount of electricity to heat water in thermal plant and generate high pressure.
Depending on local energy prices, 1,000 gallons of desalinated seawater can cost around $3 or $4. Although that might not seem like much, it is still cheaper in many places to pump water out of the ground or import it from somewhere else.
How much does desalination cost per year?
Desalinated water typically costs about $2,000 an acre foot — roughly the amount of water a family of five uses in a year. The cost is about double that of water obtained from building a new reservoir or recycling wastewater, according to a 2013 study from the state Department of Water Resources.
These ETFs do not invest in water as a commodity or in water rights. Instead, they focus on water resources companies. Water ETFs have underperformed the S&P 500, which posted a one-year trailing total return of 15.2% as of Feb. 15, 2022.
How to invest in water. There are multiple ways to invest in water. You can buy shares of companies that produce water-related equipment, such as pumps, meters and filters, invest in water utilities and environmental companies that clean, purify or distribute water.
Water Funds (ETF's) Another easy way to invest into Water like Michael Burry is to invest into an Index fund of Water stocks, or an ETF (Exchange Traded Fund).
WASHINGTON, D.C. — Today, the U.S. Department of Energy (DOE) and National Alliance for Water Innovation (NAWI) announced $5 million in federal funding to develop desalination technologies that will help bring freshwater supplies to communities across the nation.
It takes approximately 1.5 hours from seawater entering the intake structure to the time potable water enters the City's distribution system. What percentage of the City's water supply does the desalination plant provide?
- Waste Disposal. As with any process, desalination has by-products that must be taken care of. ...
- Brine Production. Brine is the side product of desalination. ...
- Ocean Populations. ...
- Health Concerns. ...
- Energy Use.
Desalination can make saltwater drinkable — but it won't solve the U.S. water crisis - The Washington Post.
The Sorek desalination is the world's largest seawater desalination plant. Sorek plant was built on the Mediterranean coast, about 15km south of Tel Aviv, Israel.
Desalination technologies offer a bright path ahead
Technological innovations that provide quality drinking water are essential for regional growth, economic success, and peace. With over 18,000 plants in over 150 countries around the world, desalination is becoming a major source of potable water.
Does Florida have desalination plants?
Florida leads the nation in the use of desalination technology. Florida's seawater desalination plant in the Tampa Bay area is the largest such facility in North America. In addition to the use of seawater, more than 140 facilities use desalination technology to treat brackish water.
"Seawater desalination is one option for California, but it's the most expensive option and it has significant energy and greenhouse gas impacts and it affects our marine environment," said the Director of Research at the Pacific Institute Heather Cooley.
While there are a few places that boast extremely clean water, such as Canada, Iceland, Antarctica, or even Upstate New York, the team of scientists determined that the cleanest water in the world was in the Patagonia region of Chile, Puerto Williams.
Israel's current scope of desalination
Today some 585 million m3 of water per year are desalinated in the State of Israel. The Soreq plant provides 150 million m3 per year, the Hadera plant 127 million, the Ashkelon plant 118 million, the Palmachim plant 90 million, and the Ashdod plant 100 million.
Other regional centres of production have emerged, such as the Mediterranean Sea and Red Sea and the coastal waters of California, China and Australia. These are oil-rich or relatively wealthy countries which can afford the high energy cost of desalination.
For least expensive option, research solar stills. The daily volume is relatively small but they are generally passive systems with production dependent on daily solar exposure.
But a less chattered-about problem is the effect on the local environment: The primary byproduct of desal is brine, which facilities pump back out to sea. The stuff sinks to the seafloor and wreaks havoc on ecosystems, cratering oxygen levels and spiking salt content.
A scientific process called desalination could help solve a looming water crisis. With a higher demand for freshwater, a growing population will continue to pressure natural freshwater resources. Today, 1 in 9 people already lack access to safe water.
Incorporating renewables into the energy input side of things is a particularly promising approach to enhancing desalination's sustainability. Pretreating water before it goes to membranes can also save energy. “The better you can clean water before it goes into reverse osmosis, the better it runs,” Fravel says.
To desalinate water, pour a small amount of saltwater into a large glass bowl with a coffee mug in the center. Cover the bowl with plastic wrap, making sure it's sealed tightly, and place a small weight or rock on the plastic right above the glass mug.
Does desalination cost a lot of money?
Desalination, the process of removing salt from water, is expensive. Although large-scale desalination plants are running around the world—generally where it's cheaper than pumping water from far away—there aren't nearly enough to provide fresh water everywhere it's needed.
We found that the LCOW for solar-driven thermal desalination ranges from $0.94–4.31 per m3 of freshwater, where the cost is affected mainly by the capital expenditure on the solar field and the operating expenditure of the desalination plant.
Typically, a large seawater desalination plant has thousands of membrane elements connected into a highly automated and efficient water treatment system which typically produces 1 gallon of fresh water from approximately 2 gallons of seawater.
How much does water desalination cost? While there are many variables related to the cost of desalinated water, Texas Water Development Board states a good rule of thumb is $1.10-2.40 per 1,000 gallons for brackish water and $2.46-4.30 per 1,000 gallons for seawater desalination.
How long does it take to build a desalination plant? It takes up to two years from starting construction to finishing it. If we include the process from the very beginning – as in, gaining the permission to build and carrying out environmental impact research – it can be as long as three years.
The problem is that the desalination of water requires a lot of energy. Salt dissolves very easily in water, forming strong chemical bonds, and those bonds are difficult to break. Energy and the technology to desalinate water are both expensive, and this means that desalinating water can be pretty costly.
Desalinated ocean water costs $1,900 to $2,100 per acre-foot. If proposed desalination projects go forward, the average household bill is expected to increase by $3 to $6 each month.
- Essential Utilities (WTRG)
- Xylem Inc. (XYL)
- American Water Works Co. Inc. (AWK)
- Primo Water Corp. (PRMW)
- Invesco S&P Global Water Index ETF (CGW)
- First Trust Water ETF (FIW)
- Invesco Water Resource ETF (PHO)
This low-cost index fund offers exposure to the utilities sector of the U.S. equity market, which includes stocks of companies that distribute electricity, water, or gas, or that operate as independent power producers. The fund's main risk is its narrow scope—it invests solely in utilities stocks.
PHO provides exposure to the US water industry and invests in companies involved in the purification and conservation of water. PHO has outperformed PIO over a 10-year timeframe and closely matched the performance of the S&P 500. Given the low distribution yield, I would not recommend this ETF to dividend investors.
Is investing in water a good idea?
Water is a vital resource with a finite supply, making it a valuable commodity used throughout the economy. Investors can attempt to capitalize on the growing trends in water renewal, conservation, treatment, and purification, by investing in water-related companies or index funds that invest in them.
Whatever happens, demand for the resource is increasing while the supply is limited. That means now is a great time to consider investing in water stocks since water technology is advancing and the challenge of the climate crisis is likely to spawn further innovations.
Water ETFs invest in stocks of companies engaged various activities in the water industry, including water utilities and infrastructure companies, water, sewer and pipeline construction, water purification, and water equipment and materials companies.
Hedge fund manager Michael Burry confirmed that he isn't short Bitcoin (CRYPTO: BTC) despite his belief that cryptocurrencies are in a bubble. What Happened: According to a report from CNBC on Friday, Burry said he has not been shorting Bitcoin or any other cryptocurrencies.
Riskier than stocks are water-rich farmland and water rights opportunities, which may have the greatest upside but equally are the least liquid investment opportunities, so they are probably best for the most sophisticated and experienced of investors – which is why Michael Burry is investing in farmland directly – ...
Key Takeaways. Warren Buffett's investment strategy is to build a portfolio of blue-chip companies with strong balance sheets, holding investments over a long time. The top five investments in Buffett's holding company, Berkshire Hathaway, are Apple, Bank of America, Coca-Cola, American Express, and Kraft Heinz.
