Electricity demand is expected to continue growing in Europe, while climate change will put an increasing strain on freshwater resources.
An EU report earlier this year warned of 'permanent water scarcity' in some member states, and pressure is expected to spread from current hotspots in the Mediterranean to South-East and Central Europe.
In Europe, Malta exemplifies the close connection between water and electricity as the island state's chronic freshwater shortage has forced it to filter seawater in three energy-intensive desalination plants, the Worldwatch Institute pointed out in a recent blog post. As a result, hikes in energy costs are immediately reflected in water bills.
"Malta is heading for a water crisis in the near future if it does not change its course soon," the think-tank argued. The country is now moving to resolve the issue by building the world's first multi-utility smart grid system, which includes the installation of 250,000 smart meters to monitor both water and electricity usage in real time.
"It's very clear that there is a link between water and energy," argued Peter Gammeltoft, head of unit for water at the European Commission's environment department, speaking in Brussels earlier this month. "I don't see any final policy solutions, but it should be looked at."
Electrification set to worsen problem
The electrification of the Europe's energy supply is set to continue and could further intensify if electric vehicles become a reality, according to the European Commission's latest energy trends to 2030 report.
The development, however, has consequences in terms of water demand as thermal power plants like nuclear, coal, geothermal and many natural gas installations require large amounts of water for cooling. Moreover, the new renewable alternatives, while preferable for their low CO2 emissions, are not all necessarily better in terms of their water footprint.
Wind and photovoltaic solar power use less water than other power technologies as they only require water during the manufacturing of the equipment, according to a 2009 report by Boston-based market research firm Lux Research.
But another solar technology, concentrating solar power (CSP), requires even more water than conventional power generation. It is being developed in the south-west US in particular, and the first European plant was inaugurated in Spain in 2007.
Parabolic troughs, the most commercially available CSP technology, collect heat from the sun to power steam cycles similar to those used by coal and nuclear stations. Such plants require cooling, which is conventionally done with water. Additionally, water is required for cleaning the mirrors that are used to collect the sun rays.
Figures from the US Department of Energy (DOE) show that CSP plants with conventional cooling systems use two or three times more water than coal-fired power plants, it was noted in another Worldwatch Institute blog post. Moreover, such solar installations are often located in water-scarce areas with maximal hours of sun light.
The answer could lie in alternative systems like air cooling or hybrid wet and dry cooling, which could reduce water usage by 80% to 90%, according to a report by the US National Renewable Energy Laboratory (NREL). The downside is that they require greater capital expenditure and come at the expense of efficiency when air temperature rises, it said.
The Worldwatch Institute suggested that despite the cost and generation trade-offs, water scarcity is likely to lead to the rise of dry cooling systems. "After all, we need to make sure that water does not limit the expansion of clean, sustainable solar energy," it argued.