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Lindsey Hall: I'm Lindsey Hall.

Esther Whieldon: And I’m Esther Whieldon.

Lindsey Hall: Welcome to All Things Sustainable, a podcast from S&P Global. As your hosts, we’ll dive in to all the sustainability topics that are reshaping the business world.

Esther Whieldon: Join as every Friday for in-depth analysis and interviews with leaders from around the globe. Together, we’ll break down big sustainability headlines and cut through the jargon. Water, it’s fundamental to all aspects of society, and yet an estimated 2.2 billion people around the world lack access to safe drinking water.

That’s according to the United Nations, which held its annual World Water Day observance on March 22. A core focus of World Water Day is supporting the achievement of sustainable development goal 6, water and sanitation for all by 2030. In today's episode, we're taking a look at the water stewardship practices of one of the world's largest companies, Amazon.

About half of the world's population experiences severe water scarcity for at least part of the year, according to the 2024 World Water Development Report published by the UN's Educational, Scientific and Cultural Organization, or UNESCO, on behalf of UN-Water.

Lindsey Hall: At S&P Global Sustainable1, we've published a number of research reports on the topic of water impacts and dependencies. For example, our physical risk data set projects that many parts of the world are on a pathway to longer periods of severe or extreme drought conditions. Our data also shows that exposure to water stress is projected to climb for major food exporting nations over the coming decades.

We've also explored how companies face water risks and how they're responding to those. Water is, of course, an essential part of many business operations from the production of food, and other materials and company supply chains to cooling plants and facilities. We'll include a link to some of those reports in our show notes in case you'd like to read more.

Esther Whieldon: And this brings us to today's guest, who manages the water stewardship practices across all of Amazon's business lines. As a bit of background to understand why we're talking to Amazon, the company has a market cap of more than $2 trillion. In 2024, it was number two by revenue in the Fortune Global 500 ranking. And as of 2023, Amazon employed more than 1.5 million people.

Amazon's business includes e-commerce and delivery services, the creation and distribution of movies and other digital video, gaming and audiobook services. It manufactures and sells electronic devices. It provides cloud computing services through Amazon Web Services, and it has a growing grocery business as well.

As we'll hear in today's episode, Amazon operates in a number of countries and regions that face water-related challenges, and it has set a number of targets related to its own operations as well as to replenishing water supplies for communities. All this means that Amazon can have a huge impact and influence when it comes to water stewardship. Okay, let's turn to today's interview.

Will Hewes: My name is Will Hewes, and I lead water stewardship for Amazon broadly. I've been in the water sector for about 20 years, worked in a nonprofit water policy space, also done some water infrastructure finance work.

And now I look over our water stewardship strategy across Amazon, in particular, thinking about and working on the replenishment projects, which are those water projects that we invest in, in communities where we operate to help support water availability, water access, water quality, those types of projects.

Question and Answer

Esther Whieldon: Thank you. So can you tell me a little bit more about that? What should our listeners know about Amazon and its approach to water stewardship?

Will Hewes: Yes. So we're thinking about water stewardship across the entire company and thinking about how to be good water stewards in the communities where we operate. A couple of broad categories of what that looks like, we're thinking about how can we reduce water use within our own operations and then also working on replenishing water in those communities. So that work is happening across the whole company.

Amazon is a really diverse company with a lot of different types of businesses, and we also use water in really different ways across different parts of the company. And so while we're thinking about water stewardship broadly across the company, we've set a couple of goals for particular geographies or particular parts of the company.

So really water stewardship started within AWS, within Amazon Web Services, the data center side of Amazon, where we announced our water positive goal by 2030. We announced that back in 2022, but it really started before that. In 2020, the program became formalized internally. And so we said that within our data center operations, we're going to be returning more water to communities than we use in our direct operations through four key pillars, we can go into those in more detail.

But that's really where we started thinking about water stewardship. And then we more recently set a goal for India across all Amazon business units to also be water positive but moved that up to 2027 for India specifically because of the scarcity there and the changes around water resources driven by climate change, India having about 18% of the world's population, but only 4% of the water resources.

And so we said that's a geography in particular, where we want to focus and where we want to make sure that we're delivering positive change immediately. So those are a couple of the public goals that we've announced so far within the context of water stewardship across all of Amazon.

Esther Whieldon: Great. So you mentioned that how you use water varies, right, by different parts of your company. Can you talk us through some of the areas that we use water the most and sort of what's that purpose for? What is it needed for?

Will Hewes: Yes. I mean, we really started within AWS because water, I would say, is most integral to our operations there and because we really want to be able to show what good water stewardship looks like within the data center industry. So we started within Amazon Web Services around those data center operations, and there's four key ways that we're meeting the water positive goal there.

One is we're really maximizing efficiency. Our last statistic there around our water efficiency is from 2023, but we'll have an update on that for 2024 soon. And that we're able to show that we use about 0.18 liters of water per kilowatt hour globally across our data center operations, which is a really industry-leading figure. And we do that by monitoring our water use in real time and making sure that we're not wasting any water.

We also use a really water-efficient cooling design, direct evaporative cooling design that only uses water part of the year and otherwise just uses outside air. And we keep looking at those operations to see how can we make those more water efficient continually. And so we've seen decreases in our water use or improvements in our water efficiency year-over-year for the past three years there. So that's one of the pillars around the Amazon or the AWS water positive program.

The second is around thinking about what other types of water can we use aside from potable water. And so we're using recycled water in 24 of our data centers currently. And recycled water, you know, it's treated sewage. So you can't do everything with that water. We're not putting it directly into faucets that people are using in their homes. There's a limited set of uses. And so we're thinking about, well, how can we help build out that recycled water use.

We can use it safely for our data center operations. How can we work with communities to co-invest in recycled water infrastructure? Which is a really drought-proof and resilient water supply. Communities make wastewater even in droughts, and so helping to build out that infrastructure helps build in more resilience for that community.

The third pillar is around reusing the cooling water. So we cycle it through our operations, through our cooling units as many times as we can. At some point, we need to discharge that and bring in fresh water, but there's an opportunity to provide that to others to use in things like irrigation.

And then finally, the replenishment pillar. So those first three are all about our data centers, how do we minimize the water use there. And then we think about after that, how can we replenish? How can we help support water resources in those communities, whether that is expanding water access or improving water quality or addressing scarcity concerns? Those are the ways that we think about that within our data center operations.

Esther Whieldon: And then for some of the other aspects of your company's operations, how does that work?

Will Hewes: Yes. So I'd say the key strategies are still the same. It's largely about, first, how do we minimize those impacts within our own facilities? And we're using water-efficient fixtures. We've looked at more water-efficient defrost systems in some of our grocery business, we're using those. We're tracking water use in real time, again, to make sure that we're limiting any waste.

And then after we've done all those things that we can to minimize water use within our own facilities, looking into the communities, especially in those that are most water stressed and looking for ways to support water resources. Plenty of examples we can go to on the replenishment side.

One of the really recent examples is around our data center operations in Spain, where we just announced three new replenishment projects, three new water projects, one that's helping to alleviate flood risk, another that's helping farmers improve the irrigation of efficiency within their operations, which is really important because then that part of Spain, 90% of the water goes for irrigation.

And so if we can help others become more efficient, it really helps make more water available to the community or leaves more water in the rivers, reduces withdrawals from those farming operations. And then the third project that we announced is helping to replace a pipeline, build more secure water supply for one of the communities where we're operating data centers in that region.

So it's really -- that's in addition to a couple of other water replenishment projects in that region that we've already announced, really trying to come at it from a basin level perspective, not just how do we meet our goal, but how do we support a portfolio of projects that meet those key water-related challenges in that area.

Esther Whieldon: So then how do you factor, like, nature and biodiversity issues into decision-making and planning here?

Will Hewes: Yes. There's a lot of internal conversations between their teams internally, thinking about biodiversity. And then, of course, there's the water goals that we've been talking about here. I'd say a lot of the water projects have biodiversity components. So some examples there, we have helped support wetland creation in a number of locations, including in the Thames River Basin outside London.

We're helping support a portfolio of floodplain reconnection projects and side channel reconnection projects in California and the Central Valley, and those are helping to support endangered and threatened salmon species, fisheries in California. And so there's a lot of nature-based solutions that are supporting rehabilitating, restoring key habitat for species.

And then there are also water-related components to some of the projects that, for example, our Right Now Climate Fund is supporting. And we look for ways that we can support projects together and really make sure that we are working in concert to maximize the benefits, both for biodiversity and nature as well as for the water resources.

Esther Whieldon: A lot of podcasts, we like to define terminology. And you've talked about scarcity and water stress are two terms, and just wondering how you define and think about those two terms.

Will Hewes: Yes. We certainly look at -- when we're thinking about where we're going to invest in water stewardship and how we're going to invest in water stewardship, water stress is one component. There's a range of different water challenges out there, not all of them just specific to water stress. And so within our replenishment portfolio, certainly, some of those projects respond to baseline water scarcity.

And for example, in Cape Town, South Africa, we've worked with The Nature Conservancy there to help them support removal of invasive species. That reduces the amount of water consumed by those invasive species, means there's more water flowing downstream into those reservoirs. And of course, back in 2018, 2019, there were those -- the really severe droughts around Cape Town. And so this is helping to alleviate some of those core scarcity concerns.

But in other places in the Eastern U.S., we've been focused on improving water quality. And in some places like India, Indonesia, there are scarcity concerns, but there's also water access concerns. And so there's a range of different challenges. There's no one single global water crisis. There's really specific local and regional challenges that we're trying to address.

But we do factor scarcity, and I will say, especially into our data center planning, when we are thinking about what's the right strategy here for cooling a data center. We use water for cooling a data center because it helps us reduce energy use, helps us meet our net zero carbon goal, helps us meet our 100% renewable energy goal. Those are all good things. But we also want to make sure that we're using water in a way that's responsible for that local context.

And so -- we do a really careful analysis of scarcity in those areas. And in certain places, even though we're very efficient in how we use water and we're trying to use recycled water and/or replenishing, in certain cases, you say it's still not the right decision for us to use water for cooling a data center here. So places like Cape Town, South Africa, and in India, in some other really water-stressed places, we've opted not to use water for cooling in those places just because it's not the right decision for the community or for our operations there.

Esther Whieldon: Thank you. So you've mentioned a couple of times the climate change and the impacts it's having around this, including the new goal you set for India. Can you talk about what you're seeing happening with climate change and how it's affecting water stress, availability, all the above related to water?

Will Hewes: Yes. A lot of the climate crisis is related to the water cycle. So a lot of the ways that people are going to experience climate change is through increased floods and droughts. Floods are going to become more frequent and when they happen, more extreme. Droughts are also becoming both more frequent and more extreme when they happen.

So the poles of the wet and dry cycle just become more pronounced for a lot of people in addition to overall -- some overall shift in the distribution of water globally. And we've built water infrastructure to respond to a historical record of precipitation, when it falls, where it falls and what intensity. And so there's a lot of adaptation that needs to happen.

And so we're really thinking about, well, we can't solve that entire crisis on our own, obviously. But how can we help plug in and help support some of those adaptations that need to happen to make sure that communities and the environment still have water they need when they need it. And part of that can be about making better use of the water that we have available. And so one of the things that we've been focused on for the past few years has been reducing leakage.

You know, every -- in a lot of parts of the world, we have aging water infrastructure systems that lose on average about 30% of the water that they have available to leaks. In some places, it's 50%, 60%, which means you can actually only use a portion of the water that you have available to you.

And so we're helping to think about in funding projects to reduce that leakage to either help communities and water utilities better locate where that's happening and prioritize leaks by size, so that they can go spend the money they have available to them in the smartest possible way or other ways that you can think about it too is to manage pressure within the system.

And so thinking across the board about how do we make better use of those water resources that we have available. And for me, the question is, with the resources we have available, what are the key innovations that we can invest in around innovative financing models, technology, business models that will not just help us meet the water positive goal, but also highlight those key innovations that will bring progress to the water sector more broadly.

So with that innovation lens, I think we can really help hopefully accelerate the pace of change and these adaptations within the water sector that we need to see to deal with that changing climate.

Esther Whieldon: How are you working with local organizations or communities on your projects?

Will Hewes: Yes. Local organizations are really the key part of the whole water replenishment work that we do. They are the ones that know what those water-related challenges are in every place where we're operating, and we're working to replenish. And so one example in Australia, we're working with a group called Great Eastern Ranges.

Spent a few months talking with them about what the challenges are that they're seeing, and they really had that community knowledge, that connection to the local groups, that understanding of what needed to happen in that community to build a more resilient water supply.

And we're working with them to do a number of things within the watershed that are going to help reduce wildfire risk and help portions of the watershed serving Sydney, Australia recover from previous fires. The regrowth wasn't happening in a way that was supporting the flow of clean water downstream, and they had a program that would help address that, bringing in a lot of local groups.

And so those are the types of groups that we really rely on to tell us what those needs are and that we work together with to create a project or a series of projects that will respond to those needs.

Esther Whieldon: What would you say are the biggest challenges and opportunities going forward in reaching the water positive goals, and other strategies that Amazon more broadly is looking to do?

Will Hewes: Yes. I think the opportunity is a huge one. We have standards for how we're implementing these programs and how we're quantifying the benefits of replenishment projects globally across the industry, but there's so much room for innovation within these projects. There's a lot of latitude in what we can support.

And so I think there's some really exciting work out there that's happening, again, to not just implement projects that help us meet the goal, but to bring in some key innovations that are crucial to ensuring a long-term resilience of the water supply. So some of the ways that we're doing that are -- I'll give two examples.

One was some of the first work that we funded with Water.org. We had conversations with them and realized they had a really innovative model that not just funded water access work, not just that brought people access to clean water and sanitation that didn't have it, but really was a very efficient way to tap into micro financing and help people access that in a way that's much more capital efficient.

So we can reach a lot more people working through their business model, through the Water.org model, in a way that's helped us reach over 1 million people so far with access to clean water and sanitation. And then we also made additional investments with them to help them build out this water and climate fund with a goal of reaching 100 million people with access to climate resilient water and sanitation solutions.

So that's one example of a really innovative business model that we realized back in 2019 when we started those conversations, could have a big impact. And subsequently, there's been a lot more investment from corporate replenishment, water replenishment and water stewardship programs into that model. So that's one way to highlight something that's working really well, but needs to be scaled up to reach more people.

One other example is we're doing a lot of work with a few different partners on, as I mentioned before, helping farmers improve the efficiency of their irrigation. And we're not just providing funding there, but we're aligning it with some of our core businesses, which is, you know, within AWS being experts in IoT, and AI and machine learning. we're helping to accelerate the deployment of technologies built on those solutions within AWS to help farmers improve their irrigation, and so the efficiency of their irrigation.

And so I think bringing that technology into it is a huge opportunity here. And I think if we're picking those projects right and we're finding the things that can maximize the impact for every dollar invested, then I think there's huge potential for these corporate water replenishment programs and water stewardship programs more broadly to make a positive impact in the water sector.

Esther Whieldon: I'm curious how you are allowing your consumers to help play a role? Do you provide any mechanisms for them in their purchasing decisions or in other ways for them to help you reach your goal or to make similar efforts?

Will Hewes: I think the focus for us is on transparency and showing how we're doing what we're doing. And so where we are on that goal, we're 41% of the way towards the AWS water positive goal, and that's as of the end of 2023. We'll again have an update on that for 2024 coming out soon in our sustainability report.

And so showing the way, I think, the way that we're engaging and not just showing customers how we're doing that, but also trying to show other companies that have similar ambitions what we're doing, what we think is innovative. And so we have the Amazon Sustainability Exchange that shows others how they can make a positive impact on water stewardship and on the resilience of water supplies.

We put out a lot of information on projects and the innovations that we're supporting in our sustainability report. And all of that, I think, is a really interesting way for others to be able to track what we're doing and to understand how we're getting to these goals as well as to potentially look at some of the ways that they could support water stewardship, whether it's an individual or a company.

Esther Whieldon: Are there any particular misconceptions around water use and water stewardship options that you often hear expressed outside of the company?

Will Hewes: I think there are – sometimes, specifically within the data center side of things, some beliefs about the water intensity of those operations that really don't align at all with the facilities that we operate and the data centers that we operate. And I think it's really important to highlight what does a water-efficient data center look like, which is what we've been trying to do.

Which is to say a water-efficient data center has really efficient water use and is constantly working to make that better. And also is thinking about how to support sustainable sources like recycled water and bring those into their operations and is thinking about how replenishment can operate and support water resources in that community.

And if you're doing all of those things as well as being really careful about that risk analysis upfront and saying, in certain places, we're not going to use water, that -- actually, the data center world can have a really positive impact on water resources.

And I think sometimes what is maybe a number from one water inefficient data center or from a specific example that maybe where water use gets misconstrued. But I think there is a difference and there is a way to be water efficient in data center operations, and we're hoping that we're showing the way on that.

Esther Whieldon: It's interesting you mentioned working like with municipalities or local water utilities because in the past years that I've covered these issues, one of the big challenges is how do they fund this infrastructure, right?

Will Hewes: Yes. I think there's two different parts of our water stewardship strategy where that integration or cooperation with municipalities takes place. One is around recycled water and the sustainable water sources. And certainly, in places we have helped to build out the distribution network, folks may not know, but a recycled water system has a whole separate set of pipes, and they are colored purple.

They're called purple pipe so that you don't accidentally mix them up with a potable water pipe. And so you have to build out that infrastructure, which is expensive. And in places -- we've worked with communities to help build out that infrastructure so that we and potentially others can also use that recycled water.

We're now even thinking about -- you know, we've looked at so many cases where we want to bring recycled water to our data centers and realized it may be too far away, and we don't really -- we're not all that water intensive and we only use water part of the year. And so we're now thinking about would it make sense to invest in recycled water infrastructure, building out the pipe to build it to someone else, even if it doesn't come to our facility, so that they can switch from potable to recycled water.

So really thinking about how do we maximize the benefit of those investments and not insisting on just supplying our facility. So we're trying to work towards some pilots there and create that mechanism and show how others -- we and others can help support that recycled water infrastructure.

And then within the replenishment portfolio, lots of conversations going on with utilities about how we can help support their operations, and the range of opportunities there could vary significantly. You know, we -- I have mentioned before, leak reduction is one key thing, and we've worked on that and are working towards some more projects in that space.

Also thinking about how can we help them protect source water, how can we help within the community improve efficiency of either public irrigation systems or public buildings. There's a whole bunch of different things that we can do to help support infrastructure and a lot of conversations that we're having around that topic.

Esther Whieldon: Now I'm curious about -- so you've been doing this for a number of years now. What are some lessons you've learned along the way?

Will Hewes: Yes. I think one important thing to think about within a water stewardship strategy is one, that innovation point that I've mentioned a couple of times. What are the key things that we want to invest in that we think are going to have a broader benefit across the water sector, and maybe we can help highlight those and accelerate adoption across the board. I think that's one really key one.

Another is thinking about how do we get to scale either by saying we're going to focus on those watersheds where we know we can do the most good. So for example, the Spain projects that I've mentioned. We just announced three new ones. We already had helped do some leak reduction there as well as helped work on a water quality project that's helping to improve or reduce the nutrient concentration in the Ebro River.

Five projects in that one watershed across a range of different types of water-related challenges starts to add up to something really meaningful for that basin, whereas a one-off project maybe wouldn't have that same level of impact.

So either thinking about how you can get there by focusing within your portfolio of replenishment projects on a few areas where you could do the most good or thinking about how you can collaborate with others on that, whether that means selecting projects that are aligned with government policies.

Those California projects that I mentioned are very much in support of state and federal efforts to restore fisheries there. And so we're helping -- it's not just us, but we're helping to support a broader portfolio of projects that other types of funding are also supporting or thinking about who are the other companies that have water stewardship goals in this area that I could team up with.

And that doesn't necessarily mean let's go spend a year studying things, right? We want to get to projects and start realizing those benefits as quickly as possible, but you start to build up a network and say, all right, if I see this concept here, can I send out some e-mails to others? Can I bring others on board and try to scale this to something that really has that impact at a basin scale?

And so I think making those connections and starting to build that network is really helpful to maximizing the impact of the investments that you make. And we're always thinking about not just how do we invest in a project, how do we do it and get to scale that's going to have a broader impact for that ecosystem for that community.

Esther Whieldon: Today, we've heard Will using the term water positive. And for listeners who aren't familiar, this term means when a company returns more water to communities than it uses in its own operations. We'll also talked about Amazon's work with Water.org. That's a nonprofit co-founded by the actor, Matt Damon.

We talked to Water.org CEO, Gary White, for World Water Day in 2024, and we'll include a link to that episode in our show notes. Will also mentioned that Amazon's strategy includes focusing on specific watershed areas where it can do the most good. A watershed is a system of creeks, streams, wetlands and rivers that flow into a common outlet such as a reservoir, a bay or the ocean.

A watershed also includes any surface water or groundwater that's in the area. Watersheds are also sometimes called drainage basins. So for example, where I live in College Park, Maryland, I'm in the Anacostia River watershed, which is part of the broader Chesapeake Bay watershed or drainage basin. I asked Will what advice would he give to individuals who want to adopt water stewardship practices in their own lives. Here are his suggestions.

Will Hewes: There's really a diverse set of different water challenges out there. So if you're in the Eastern U.S., a lot of those challenges are around water quality. And so if you're thinking about how do I think about my impact on that watershed, you may think about how do I reduce runoff from my house or the parking lots that – or, you know, the driveway.

Maybe I think about putting in a rain barrel that allows me to reduce the use of water from the potable water system and at the same time, reduces runoff from my property because that runoff, especially in more areas with higher rainfall often carries -- the rainfall carries with it once it lands, bad stuff that's already on the ground.

So how do I think about reducing the runoff? How do I think about maybe reducing fertilizer or pesticide use? It's a lot of those challenges around water quality. In the Western U.S. and other more arid places, you want to think about the more scarcity-driven challenges. How can I think about landscaping and use less water-intensive landscaping? Can I find ways to install more efficient fixtures? Can I find ways to make sure I'm identifying leaks?

And there are projects out there that will alert you when there are leaks on your property, which saves you money, can reduce your risk of having water damage, but also make sure that you're not wasting water resources. So there's no one answer there, but I would say thinking about and understanding your watershed, what the challenges are there, that's one key place to start.

Esther Whieldon: Thank you so much for talking with me. We're really glad to have you on to talk about this important issue.

Will Hewes: Thanks for having me. I enjoyed the conversation.

Lindsey Hall: So today, we heard how one of the world's largest companies is approaching water stewardship. Will said that Amazon is working to reduce water usage across its operations and also replenish and improve the quality of water in the communities where it operates. He said the strategy for Amazon's operations includes water efficiency, using recycled water where possible and cycling water multiple times as part of its systems cooling process.

Esther Whieldon: Two things Will mentioned stood out to me. One is that Amazon will sometimes opt to not use water for cooling its data centers if the region already faces extreme water shortages. Another is how they're working with communities and local organizations to make sure that the solutions they tailor are effective.

Lindsey Hall: Please stay tuned as next week, we'll be back with more coverage from the S&P Global CERAWeek Conference, where we'll be talking to companies about how they're approaching the energy transition. Thanks for tuning in to this episode of All Things Sustainable. If you like what heard, please subscribe, share and leave us review wherever you get your podcast.

Esther Whieldon: And special thanks to our agency partner, The 199. See you next time.

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