Digital is making waves in water management, enabling smarter decisions and greater efficiency through real-time monitoring and predictive analytics. Dr Thomas D Krom, Seequent Segment Director, Environment, writes.
Water is the lifeblood of our economies, societies, and ecosystems. Yet, for decades, we’ve undervalued and mismanaged it. Today, the stakes couldn’t be higher.
The economics of water: Turning challenges into opportunities
The Global Commission on the Economics of Water (GCEW) has sounded the alarm: water scarcity, climate change, and biodiversity loss are destabilising the hydrological cycle that sustains life on Earth. At the same time, the European Union is doubling down on water resilience as a cornerstone of its sustainability agenda.
The question isn’t whether we need to act – it’s how quickly we can scale solutions that work. And here’s the good news: water isn’t just a challenge; it’s also an opportunity. With billions of dollars flowing into water-related projects globally, there’s a growing market for innovative solutions—particularly in the digital area—that can transform how we manage this critical resource.
A massive funding gap—and a chance to close it
Let’s start with the numbers. Achieving Sustainable Development Goal 6 (clean water and sanitation for all) will require an additional $500 billion annually in investments in low and middle-income countries alone.
That’s just the tip of the iceberg. To stabilise the global water cycle – blue water (rivers and lakes) and green water (soil moisture)—we’ll need even more. The World Bank has estimated that up to 80% of climate adaptation costs are related to water.
In Europe, the EU Recovery and Resilience Facility (RRF) has already committed €12.92 billion to water-related projects across 15 Member States. Spain and Italy are leading the charge, investing heavily in reducing leakage, improving wastewater treatment, and modernising infrastructure. These efforts aren’t just about compliance—they’re about building resilience in a world where water risks are becoming increasingly unpredictable.
For decision-makers like you, this significant funding gap represents a call to action—and an enormous opportunity to lead.
Spain and Italy are leaders in terms of investing in reducing leakage, improving wastewater treatment and modernising infrastructure.
Digital can make waves
Technology is rewriting the rules of water management. From real-time monitoring to predictive analytics, digital approaches are enabling smarter more timely decisions and more efficient operations across industries and sectors. Here are three areas where digital is already making a difference – and where investment opportunities are ripe:
1. Digital water management. Imagine being able to monitor an entire city’s water network in real time -detecting leaks before they happen, or optimising distribution based on demand patterns. That’s not science fiction; it’s happening now at utilities like Evides, Agea and Sabesp.
Why it matters: In some cities, up to 40% of water is lost due to leaks. Fixing this isn’t just about saving water – it’s about saving money.
Who’s investing: Venture capital firms and corporate players like Bentley Systems are pouring millions into startups that specialise in IoT-enabled sensors, AI-driven analytics, and smart water platforms.
EU spotlight: The European Commission put forward a political mandate to digitalise water management and water utilities in its 2024-29 mission letter to Commissioner Jessika Roswall and continues to fund R&D programs like Horizon Europe, which supports cutting-edge research projects in the sector.
Detecting leaks in real time is not science fiction, it’s science fact.
2. Wastewater treatment and reuse. In a world where freshwater is becoming scarcer by the day, wastewater isn’t waste—it’s a resource waiting to be tapped.
Why it matters: Treating wastewater could reclaim about 8% of global freshwater withdrawals, equivalent to all municipal water use worldwide.
Who’s investing: Startups like Gradiant have raised over $392 million to scale advanced treatment technologies that recover nutrients and energy from wastewater.
EU spotlight: Under its circular economy agenda, the EU is investing heavily in wastewater reuse systems that reduce pollution while creating economic value.
3. Agricultural water efficiency. Agriculture accounts for 70% of global freshwater withdrawals—and much of it is wasted due to inefficient irrigation systems.
Why it matters: Scaling precision irrigation could save up to 25% of irrigated water consumption by 2050 while boosting crop yields.
Who’s investing: Agri-tech startups like Kilimo are using SaaS platforms to optimise irrigation schedules and verify water savings that can be monetized as offset credits.
EU spotlight: The EU supports regenerative farming practices through its Common Agricultural Policy (CAP), creating fertile ground for innovation in agricultural efficiency.
The EU’s leadership on water resilience
Europe has positioned itself as a leader in addressing global water challenges. The European Commission’s focus on water resilience underscores its commitment to aligning climate action with economic development. Through frameworks like the RRF, and Cohesion Policy, the EU is not only funding infrastructure upgrades but also looking more closely at how to foster innovation to make these systems smarter and more efficient.
But what is in place now is not enough when one considers the urgency of the problems and the funding gap. Therefore, policymakers and business leaders alike should work together, as this presents a unique opportunity to Solve a strategic European problem while tapping into one of the fastest-growing markets in sustainability.
Who’s funding this revolution? The funding landscape for water solutions is diverse—and growing:
1. Private venture capital: Firms like Westly Group are betting big on early-stage startups developing game-changing technologies. Corporate venture capital initiatives are targeting scalable solutions for utilities and industries. Venture capital investments are expected to nearly double in 2025 compared to 2024.
2. Development finance institutions (DFIs): Many organisations like the European Investment Bank; the European Bank for Reconstruction and Development; World Bank and African Development Bank are providing concessional loans to de-risk investments in emerging markets. DFIs are increasingly backing Just Water Partnerships to mobilise private capital for underserved regions.
3. Public-Private partnerships (PPPs): Governments are teaming up with private entities to modernise infrastructure through performance-based contracts. Examples include leak detection systems funded by municipal utilities in Sub-Saharan Africa and South Asia.
4. Multilateral initiatives: Programs like the UN System-wide Strategy for Water and Sanitation aim to accelerate progress toward SDG 6 by fostering innovation at scale.
What does this mean for you?
The intersection of technology, funding, and policy presents an unprecedented opportunity to transform how we manage water—a resource that underpins everything from food security to climate resilience. For decision-makers in government or business, this isn’t just about solving problems; it’s about seizing opportunities.
By investing in digitally-driven solutions—whether it’s digital monitoring platforms for utilities, advanced wastewater treatment technologies for industries, or precision agriculture tools—you can drive measurable impact while unlocking long-term economic value.
Given the massive funding gap and the strategic nature of these challenges, now is the time to lead boldly. Together, we can reshape Europe—and ensure that water security becomes a cornerstone of sustainable development worldwide.
