Desalination in Australia

In the WSJ today was an interesting piece on the desalination plant built in Australia's largest west coast city - Perth. Desalination is the process of removing salt from sea water. Coming from Sydney which went through a big desalination debate (still going on I hear) during the worst of the drought in 2006, I did not realize that other cities in Australia were well ahead in using desalination to provide part of their water needs. What was especially insightful was the environmentally friendly manner in which it was being done. Here is a video review by Patrick Barta of the WSJ that talks about the story behind the desalination plant:

Points of note from the article were:

- Opened in late 2006, Perth's $360 million desalination plant sucks in roughly 50,000 gallons of the Indian Ocean every minute. It then runs that water through special filters that separate out the salt, yielding some 25,000 gallons of drinkable water -- enough to meet nearly a fifth of Perth's current demand (city population is 1.3 million).

- Perth's facility squarely tackles both environmental and financial concerns. It gets around the issue of noxious emissions by harnessing power from a wind farm. By relying primarily on renewable energy -- a recent trend in desalination -- the plant releases fewer dangerous greenhouse gases into the atmosphere. Upgraded systems remove salt more efficiently than past processes, making operating costs less daunting.

- Several Australian cities are adding massive desalination plants. The largest, near Melbourne, carries a price tag of more than $2.5 billion. Similar facilities are envisioned in Spain and India. And London is planning a $400 million plant along the River Thames.

- Perth's plunge into desalination comes at a critical time, when water is emerging as the world's next major natural-resources challenge. Water use, like oil, is surging as economic growth takes off in China, India and elsewhere. According to the International Water Management Institute in Sri Lanka, about a fifth of the world's population, or more than 1.2 billion people, already lives in areas with insufficient supply.

It is worth reading the full article for the background and details on the desalination process works. I'll be looking into how I can possibly invest in the above trend and provide an update in a future post.