Leading Wall Street Water Analyst Neil Berlant: Price of Water in US to Rise Up to 300% in Next 2-3 Years
Submitted by EnergyTechStocks.com
Memo to U.S. Federal Reserve chairman Ben Bernanke: You’ve got a new inflation concern headed right at you – water. Over the next two to three years, the price of water may rise 200% to 300%, as the cost of critically-needed infrastructure repairs, greater purification for manufacturing and healthcare, plus more desalination plants, ultimately gets passed through to every American household.
That’s the view of one of Wall Street’s most seasoned water analysts, Neil D. Berlant, manager of the PFW Water Fund (Symbol: PFWAX), a mutual fund focused on companies involved in all aspects of water, including infrastructure, desalination, purification, disinfection and utilities. While the fund only went public about a year ago, Berlant has been covering the multi-faceted water industry for many years and has worked in investment banking for decades.
During nearly a half-day-long conversation with EnergyTechStocks.com, Berlant warned that rising water prices are going to “contribute mightily” to the cost of living in the U.S. One of the drivers of these higher prices – infrastructure repairs – is well known. Up to $1 trillion or more will be needed to fix leaky pipelines and more, Berlant emphasized, adding that a lot of repair work is already underway, the costs of which regulators are starting to pass through to water utilities’ customers.
But other significant drivers of what Berlant sees as the coming tidal wave of rising water costs haven’t yet received much media attention. Noting that “Water is at the heart of every manufacturing process,” Berlant said auto, steel, plastics and a host of other manufacturers increasingly require highly purified water to avoid product imperfections. Meanwhile, the healthcare crisis in the U.S. is causing a sharp increase in the need for products that depend on water purification, filtration and related processes.
Berlant said the price increases for water will show up both directly on water utility bills and indirectly in increased manufacturing costs that get passed through on a wide range of manufactured items, everything from cars to plastic bags. He emphasized that the U.S. has some 60,000 water utilities, primarily small and municipally-owned, which have no way to pay for repairs except through higher rates. He further emphasized that he expects publicly-traded companies to start breaking out water costs separately as the cost of it rises rapidly.
