Water scarcity assessment

A water scarcity assessment is a structured process that analyses the availability of water resources in a given territory against the demand placed on them by different sectors (agriculture, industry, urban use and the environment). It is essential for identifying situations of water stress, planning sustainable management policies and anticipating risks linked to climate change, population growth and economic intensification.

International bodies such as the FAO, the World Resources Institute (WRI) and the European Environment Agency use water scarcity assessment methodologies to inform decisions at global, national and local level.

Definition

A water scarcity assessment brings together the methodologies, indicators and analytical tools used to measure the extent to which water demand exceeds, or threatens to exceed, availability in a specific area. It is not a simple calculation: it integrates environmental, social, economic and climatic factors.

Objectives of the assessment

• Diagnose the current state of water availability and use.
• Identify future risks under different climate and development scenarios.
• Set management priorities for productive sectors and ecosystems.
• Guide public policy for water resource planning.
• Give companies tools to assess risks across their supply chains.

Methodologies

1. Indicator-based approaches
   • Falkenmark Index: cubic metres of water available per person per year.
   • Water Stress Index (WSI): the ratio of demand to availability.
   • Scarcity coefficient: the proportion between consumption and available resources.
2. Hydrological models
   • Simulation of river flows and aquifer recharge.
   • Projections under different climate scenarios.
3. Integrated assessments
   • Incorporate socio-economic variables, water quality and ecological needs.
   • Example: the WRI Aqueduct Water Risk Atlas.

Key variables analysed

• Natural water availability: annual renewable resources.
• Sectoral demand: agricultural, industrial, urban and environmental.
• Water quality: pollution and salinisation.
• Efficiency of use: losses in distribution networks and irrigation systems.
• Temporal variability: seasonal and multi-year droughts.
• Climate change: reduced rainfall and rising temperatures.

Regulation and reference frameworks

• EU Water Framework Directive (2000/60/EC): requires Member States to assess and report on the status of water bodies.
• Regulation (EU) 2021/2115, which integrates sustainable water management into the Common Agricultural Policy through national CAP Strategic Plans.
• River Basin Management Plans (in Spain), which include periodic scarcity assessments.
• UN Sustainable Development Goal 6: ensure water and sanitation for all.

Benefits of the assessment

• Environmental: helps maintain ecological flows.
• Economic: supports investment planning and avoids losses from water shortages.
• Social: reduces conflicts between sectors and territories.
• Business: provides security in water-dependent supply chains, complementing a wider water risk assessment.

Current challenges

• Availability of reliable data, especially for aquifers.
• Spatial scales: differences between basins, regions and countries.
• Integrating water quality, not only quantity.
• Incorporating the corporate water footprint into local assessments.

Relationship with the circular economy

A water scarcity assessment drives circularity measures such as the reuse of wastewater, recirculation technologies in industry and more water-efficient agriculture. It is closely related to the concept of water scarcity and to corporate water stewardship more broadly.

Assessing water scarcity is a strategic tool for anticipating risks and managing one of the most critical resources. It helps address recurring droughts, secure food and energy supplies and guide both public policy and business strategy towards more resilient models. At Manglai we help companies measure their environmental footprint and prepare their sustainability reporting. Discover how Manglai can help you.