(upbeat music) - Hi, Reza, how are you? - Good, Shay, how are you doing? - I am good. It is episode seven of "Future Forward" here. Yeah. - I'm excited about this one, Shay. Tell us what we're gonna talk about today. - Yes, today's episode is all about the future of water in cities. - Wow, so this one's gonna be a good one, Shay, because you've been, your last startup was on water. My first job, as I've mentioned before, was add energy and water utility. And so it's like front and center in my early development, in my career. So I had a lot of questions, and I know that you've spent a lot of time thinking about water. But before we do that, let's tell folks about "Future Forward" Jay. - Yeah, yeah, so for new listeners, welcome to "Future Forward." It's a conversation Reza and myself I've been having for the last few years, and we recently decided to bring you all into it. It's our exploration of the future of cities, taking a good look at the history of the systems that run our cities, and then providing some strategic foresight about where we believe the industry or the system is going. - Awesome, so let's jump in, Shay. Let's take us back, like where did this begin? - Yes, this one is a fun one. I've presented about the water industry at several points, and I always love starting with the story of Aaron Burr, the infamous Aaron Burr, who apparently was the first person in the US to start a water utility. And the story goes, yeah, it's crazy. In the 1780s, 1780s, 1790s, when in New Amsterdam, which we all now know as New York, a thousand people died from what doctors believe back then were waterborne diseases. Reading a bunch of books highlights that this was technically the first official water crisis in the US. We had the great stink in the UK that really started to move the country, and most of Europe, honestly, towards sanitation and filtration and sewage systems and water systems. But the first real crisis in the US was in the 1780s, early 90s, when Aaron Burr, who was already in government at this point, and the technology and ideas from Europe, we're starting to bubble over across the pond into the US, proposed to the new Amsterdam is what I'll call it, the new Amsterdam planet and government that he could build sewer systems, drinking water filtration systems, treatment plans to help address what had been identified as the waterborne disease. 2,000 people dying at that point in New Amsterdam was a big deal. Remember, consequently, Aaron Burr was given $2 million, which is about $44 million in today's terms. But instead of building the water system, he took that money and put it in a company called the Manhattan Company, which was supposedly the water company he was starting. But it wasn't really a water company. It was what we now know as the first business entity slash location for what we know as JP Morgan Chase. - That's crazy story. - Yes, it's crazy. And so he failed to address the problem and other industrialists, business people were given more funds and the issue got addressed because again, remember, we already had some of this technology from Europe and it was just the case of implementation. New Amsterdam got water from beyond its direct sources, which led us to our first grand builds of water infrastructure systems, getting water from the Delaware River, happening up to New York. So that was the first water crisis, 1780s, 1790s. And we can really consider where we are today as the fourth water crisis in the U.S., but I'll touch on the second and the third quickly. The second water crisis in the U.S. was right after World War II. And similar to the first one, the government of the United States at this point made financial decisions to pour billions into building infrastructure, most of which is what we still use today. A lot of the water systems that we use today that we rely on today were built right after World War II. The third water crisis happened in the 1970s and the major flashpoint then was industrial pollution of the Koya-Hoga River, which led to a river fire and protest. Remember, we talked about this protesting in the 70s across these different systems that we've discussed. Well, the protests as a result of some of the pollution, industrial pollution that led to the fire is what a lot of industry experts consider as the birth movement for the Environmental Protection Agency in the U.S. now, $60 billion of funds were appropriated for what we now know as the Clean Water Act in 1972. I'm mentioning the Clean Water Act because that was in 1972, which is over 50 years ago now. It is still the dominant and prevailing law under which we manage water systems, ignoring the fact that we have discovered millions of new formulations of materials and chemicals and chemistry, which we're not testing for properly or cleaning and drinking water systems, and which is how we've landed in our current state of what I've said far and wide is the fourth water crisis in the U.S. - So I'm just gonna, I have two comments, one. Aaron Burr from Hamilton, Dang. - Yes. - Yes. - Okay. - Okay. Just trying to like pinpoint that. And so that was first, you know, first crisis, then we had the one after World War II, that sort of drove out the infrastructure, and then we had this crisis in the 70s, which we've seen with other systems, but that drove a set of regulations, but we've stifled some of the things that we're trying to do with water as a system, and we haven't evolved our thinking as the science has evolved. Like, am I catching up on that, right? - You are catching up on it. I will say it's both slowed down the evolution of the system. - Really? - I'd say that is more the case, because water is life, and we know that. And consequently, the entities that are charged with providing us water take that responsibility seriously. - Yes. - But the incentive is not to change anything, honestly, even as everything is changing around it, because the framing is it currently works. And we're talking about drinking water here. What we've been doing for so far works, for so long works is sort of how we frame it. About 92% of US water systems, utilities, both private and public still use chlorine as the disinfection mechanism in water. This is a technology that was invented in the early 1900s, and the approach was invented in the early 1900s, and it is still the dominant method for filtering water in the US today. That kind of shouldn't be the case. - Yeah, that's kind of crazy. Deep parts, we see parts of our world sort of evolved so rapidly, this one just seems to have, you know, just stultified, stagnant, stagnant water stagnation. - Yeah, yeah, yeah. - So Shay, bring us into the present fourth water crisis. Tell us where we are now. - Yeah, so we're recording this in late June, and the first week of June in Atlanta, Georgia, in the US, they had a water crisis. And the nature of water crisis from time past that we've just explained, the nature is that the infrastructure to do one of the two things we need to do to water. We either need to clean it if we have it in a place, so that it's drinkable or more, we need infrastructure to move it from one place to another place to then clean it, to make it drinkable, and then we move it to the people who need to drink it. So the crisis with water always revolves around one of both of these two systems failing, the system for moving the water or the system for cleaning the water. And in Atlanta, Georgia, as has been the case in Jackson, Mississippi, New Jersey, Houston, Austin, Texas, and tens of thousands of other cities in the US, one or two of these systems have broken or both. And in Atlanta, both of those systems failed in the first week of June, the last day of May, 2024, into the first week of June, 2024. Assets failed, pipes broke, and remember, these pipes were built after the Second World War, and consequently, they are well past their cell by date, unfortunately. And the approach in the US has been, and honestly, in many parts of the world, having studied this industry is not to do the hard work of fundamentally rebuilding the water systems. It is to patch and ignore till the next crisis happens. Atlanta had the problem, the city with the most, the busiest airports in the world couldn't provide water to its residents. And I was having a conversation with a friend who reached out when this happened, and people ignore that when you have a water problem in your city and they declare a ball water issue, which means don't drink the water, you need to boil it because there might be contaminants in it, it is not just the average individual that struggles. It is, the knock on effect is astonishing, and I'll give you the scenario I played out on my conversation with him. Atlanta will be one of the cities hosting the World Cup in a few years, 2026, soccer world club in 2026. If the same incident that happened in Atlanta at the beginning of June 2024 happens during the World Cup, the athletes who come will not be able to drink water from the hotels they're staying in, the restaurants will not be able to serve them. The stadium will not be able to host the games, because as we saw with the Atlanta situation when I believe it was Megan the Stallion's concert got canceled, you will have to cancel everything. And we will, I hope we won't, let me reframe that. I hope we won't experience that because this Atlanta incident happened less than three weeks ago. It is no longer in the news, Reza, and it has not been fixed. - I mean, Jay, I try to keep up with the news. I might have glanced that something happened, but it passed by, just passed by, you know, it was like the majority of the news was much more prominent. So, and I'm really curious, like, Jay, and maybe you'll start touching on this as we start talking about the future, but it seems that water is such a fundamental part of, you know, our lives and us being able to form communities and cities in the historical times, like people would form communities where there was a source of water because we just needed it to live. - Yes. - And now we build cities that have systems that allow us to build in places that don't necessarily have, you know, just a river running by or a lake or what have you. And I'm curious about why we allow these situations to occur and the thought that comes to my mind is this is something that I, you know, when I worked at that utility, it was always conversation about like, well, water is never priced at the market rate. - Yes. - And I understand why because like you can't price water at the level that you need to pay for it because it would be expensive. Like it costs a lot to purify water. And so that would create like inequity in a way that would like you're basically taking away a fundamental, you know, right or a way of moving to have water access to good water. So yeah, so that's the one thought that comes to my mind, Jay. - It's a, it is at the core, the problem with water systems in the US and you've nailed it, Reza. It is at the core. There's this mismatch between what work is done to get water to the end user and how much it genuinely costs. A bottle of water, quote unquote, bottled purified water for what it's, what the marketing department suggests these company issues. The same quantity of water is about 220 times what you pay for that water when it comes out of your tap in your home. - Gee. - And at some point we need to balance that difference so that the water systems that do the utilities that do the work can provide updates or update the infrastructure and the assets so they can continue to provide the water to residents but not at a price that makes it impossible for that worse-ins inequalities in our cities. You made a second point that I think is again, quite critical in this conversation. We free the big major global cities, the cities that we all talk about as the places we want to visit and enjoy. Economically and ecologically tied to the water. Tokyo, London, New York, Amsterdam is even known for the canals and the workways. Any city that you are attracted to to visit that has a rich culture, rich history and is global in its populace is close to water. Match those two things you just shared the inability to price water correctly and the centrality of water to those cities and you have the problem of experiencing right there in the front of our cities, yeah. - Well, I have like another follow-up question which is, and this comes from our experience growing up in a developing country like India or Nigeria, like water was always a problem. Like there was times when we didn't get water. Tanker would come, fill up the tank and you fill up buckets during the day so you could take a bucket bath at night. It was just like we lived with water scarcity at times and when I, coming to the US, I was shocked that the water that came out of the tap was water that I could drink 'cause it was never true in India. - Yes. - But what shocked me even further was that same water was used to water yards. I just blew me away. It just utter waste in my, in my, you know, it just, you know, it's like all that electricity and especially in a state like Texas and here's a stat that, you know, made my mind explode is that, you know, what percentage of water, you know, home in Texas is used to water the yard? It's 70%. - That is insane. - But 70% of that water that has been purified for drinking goes into watering yards. So all of that to say, like it just, that drives me nuts when I, when I learned that I don't water my yard. I call it God's garden, you know, like thinking that lives in there, because, you know, God meant it to be, except there's a phrase in, in Parsi and in Jungkalimola, which is like, you know, that it lives, it was meant to live. - That is great. - Almost not. But the question that I have, Shay, is it doesn't seem that we have figured out in the system of water, of like recycling water well? Maybe it exists in other countries, like I've heard of desalination, you know, in Middle Eastern countries. It takes up a lot of electricity, but they had a lot of energy to do so. But I'm curious about water recycling. And is it because we don't have a market rate for water to invest in those types of things? Or is there some fundamental problem with water recycling? I just don't know enough about it. - Yeah, so this actually starts to touch on sort of the future that we always want to make sure we thread through from the past. A big part of what you're highlighting here, Reza, is that we need to fundamentally redesign our water systems. So the waste that you've rightly called out, the waste of both clean water to water your gardens, and the energy used to power the systems that clean and purify the water. - Yeah. - Leave us in a situation where we will always be playing catch up because that system is just wasteful, period. - So we need to redesign our systems. And now we're having a lot more conversations about pipes in homes with gray water and blue water, is maybe the best way to frame it, to separate what gets you. So do we not fully purify the water that comes from water sources at a certain point in the filtration experience? We pipe it out into the gray pipes so that it goes into the homes for flushing toilets, watering your grass, and those non-portable needs. Portability is the ability to drink the water, and then you perform the rest of the steps to filter and clean the water for the drinking part of what comes into the home. So you are correct. That is part of what the future, the water drinking water and wastewater needs to be. Do we recycle water? Yes, we do a lot more than people realize, actually. And that is a good thing about the water systems I'd say here in the US. There are multiple steps in even the traditional wastewater to drinking water process that make it a thing. Yeah. And the part of the problem with the industry, which goes to the second thing, I think needs to change about the industry in the future. So the first one was to design in the systems fundamentally. The second one is to start to like show the work that goes into getting clean water into our homes, because then we will provide information to you and I, such that when we price water correctly, the end user, you and I, understand that it's because there's a lot of work that happens on the back end. So I'll use an example, LA, I believe it was LA water department. They ran this project where they have gone to desalination, the example you use. And desalination is not new technology, it's just energy inefficient, which is why it hasn't been used as much. But the city of LA and the water department, they ran this campaign where they took wastewater, sewage, and converted it to drinking water and essentially branded it to make it acceptable. And there are parts of LA right now that the water they're drinking was used to flush the toilet, just a few weeks before that. So we're getting there, the inefficiencies of desalination, of energy use of desalination, we're starting to address those with dual sightings. A desalination, a water desalination plant now has its own renewable energy power plant, for example, and it uses solar and battery storage. So it's sustainable and you get the clean water on the back end from what was sewage or wastewater, just a few cycles before it gets consumed. - Interesting, interesting. It seems like you said that these systems have to be fundamentally redesigned, but I could imagine that there are some constraints on doing that 'cause my impression about water utilities are they're very fragmented much more so than electric utilities. Like electric utilities tend to sort of be larger, serving larger areas and water utilities are like smaller and more fragmented, even have like these municipal utility districts and small towns with all these public water systems. So given that how, you face that with your startup baruna, where it was a struggle, the go-to-market was a struggle because of this fragmentation. So maybe I'm curious a little bit more about what you mean by fundamentally changing these systems and if that fragmentation is a constraint. - It is, it is your again, hitting the core element or the core constraint is, it's a better word. So there are about 50,000 water and wastewater systems in the US. It is highly fragmented. - Yeah. - And part of the issue here is that where all in some cases I'll use an example, you have three or four small municipal water systems trying to run their own water system and they face the constraint of both the examples, the framing I provided before of do we have the water and in the case of the west of the country, we're now seeing situations where water systems or water utilities that are further down south of the head of the Colorado River are now struggling with having the water to clean. So there's not enough water in the first place and you have a municipal utility just a few miles up the road also trying to do the same work. So the fragmentation leads to massive inefficiencies and these inefficiencies worsen when we start facing the problem we're experiencing with climate change. Now, whether it's not enough water in the system. And then you get to the second problem of this fragmentation, the purification of the water or the cleaning of the water and these utilities, these municipalities not having enough resources because they're not pricing the water adequately, struggling to pay for the infrastructure and the upgrades to get clean water to their residents. So I say we have to fundamentally redesign the water systems. There was a bit of a lifeline with the federal government providing in total over a trillion dollars of spend across different systems in cities across the country. But the water sector is getting hundreds of billions of dollars, which the Society of Engineers have come out to say will not be enough to fully rebuild. But I actually think that's a, that is not as much of an issue as the one I'm seeing, which is even as we're replacing pipes, one of the ideas I have here is that we should restructure the utilities and move away from, we'll go back to this centralized versus distributed, who have huge water plants in the north end of the city, treating the water for the whole city and then piping it down. The idea is we should move to smaller, sort of micro infrastructure that addresses the water needs of a constrained geographic region that is smaller than what we've currently done, one. And then two, we shouldn't just lead the same pipes where lane, the work that's currently going on with changing out the lead pipes that is leading to a lot of contamination across the country. These lead pipe replacement projects, they literally lane types right beside the old pipes and they're not lane gray or blue pipes or whatever it is, which is just the same, it's just the same. And we're not embedding the new pipes with internet of things infrastructures so that we can better track and manage both the quantity and the quality. So we don't have enough and we're not using what we have wisely is my realistic assessment, even though I'm naturally an optimist, is my realistic assessment of where we are with the water crisis and my calls for fundamentally redesigning the water system seem to be falling on deaf ears now, unfortunately. - Well, I say you don't sound your optimistic self when it comes to water, but we're hopeful where both of us are and I'm looking forward to an episode in a year or two where some of this money that's going into these new systems, maybe some of that identifies new ways for us to rebuild these systems. - I'd like us to sort of close on an awful note. - It is, I can share a real hope here. Some countries and some regions and some cities have figured it out, they've figured it out. They saw the problem and they chose to address it. The amount of innovation coming out of Israel for drinking water and flood management 'cause we've talked about drinking water mainly on this episode, but we also have the flood water considerations that we have to think about and the source water considerations we have to think about. Israel is a big kind of light in terms of facing the problem head on and implementing innovation at the, making available new sources of water by cleaning water that we thought we couldn't clean before, at energy efficiencies that are phenomenal. There's the redesign of homes and water usage in homes to impact consumer behavior, to address the problems of both contamination and wasting homes. And we have just a lot of what I believe innovation, what we need is the willpower and the will to say we will face it head on instead of what we've done so far, kicking down the, kicking out the road. But I 100% believe it will be addressed. Otherwise, I'd probably have found another country to move to, I strongly believe we'll address it here. - Yeah, no, that's great. No, thanks for bringing that up. I think that's, yeah, like you said, a ray of light, some hope over there in seeing maybe some of that coming back to the US and being applied. - Absolutely. - Yeah, that's good. - Absolutely. - Yeah, so she, I think that's a good place to bring this to a close. As we always end our episode, we have our mail bag and I have one for us this time. When our listeners used to reach out to me and said, hey, you guys do a really good job of editing every episode and making it a really good production, like who is doing this for you, thinking that was some professional and so I sent you a text and, you know, I think it was pretty funny what you said in response. - Yes, yes, I confess that this is aided editing. So I do the editing, but it's aided with the A and the I at the beginning of the ADB, the critical part here. AI does a lot of the good work for us, both in image generation to suit the conversation and for those of you who listen on podcast tools, you're not seeing those images which we post on YouTube and you can check those out anytime. And then the editing of the whole episode is aided by AI. I'm just the guy who gets to say yes or no to the edits that AI recommends. - That's pretty cool. I think that's pretty cool. I mean, here's a good example of AI and well technology in general, just becoming a tool that allows us as humans to create and connect and help us to connect. You know, help us figure out how we can thrive better. I love, I love how AI is, you know, I'm a little biased, but I love how AI is. - Yes, yes, considering AI is part of your daily work and I know you're positive about it and I am as well. And it touches on some of just how we see the need for technology to aid how we build the future of our cities always. - Yeah, well, great. So Shay, like we always say at our close of our episodes, please keep the mail bags coming, send your comments, your questions, your corrections, your input. Of course, like and subscribe rate and review that helps feed the algorithm and encourages others to listen to us. But most important, as we always say, share it with a friend, make that connection. And hopefully we grow this community of, you know, talking and thinking about the future of cities. - Thanks so much, Reza and to all our listeners, we'll see you next time. - Thank you, bye. - Bye. (upbeat music) (upbeat music) [MUSIC PLAYING]
