Natural capital valuation offers water companies a powerful tool to identify sustainability challenges, engage stakeholders such as the chief financial officer and drive innovation in low-carbon technologies, a recent meeting of water industry executives concluded.
Natural capital valuation is a way of putting a monetary value on natural resources such as water, clean air, a stable climate and plentiful land, forests and oceans. At present, our economic system takes these natural resources for granted, yet we all rely on them for our continued prosperity and well-being. By putting a price on natural resources that reflects their real value, we can encourage business and society to use them in a sustainable way.
In Australia – a country that is already suffering extreme weather including droughts and wildfires – Yarra Valley Water commissioned research to calculate the value of water in Melbourne. The study found that the value was three times higher than official water prices. The results helped inform debate on how to balance customer demand with the need to conserve and enhance water resources.