The second step in conducting an initial
risk assessment of a company's water uses is to consider
the water source information prepared in Module
1 to assess the likelihood of the changes considered
in the sensitivity analysis actually occurring. Frequently,
this will be linked to the vulnerability of the water
source(s) relied on for the use. For example, an aquifer
that is being rapidly depleted or contaminated would
likely be vulnerable to changes or response actions
such as public policy changes or price increases that
can affect the business. However, changes in water prices
and allocations are often not directly related to the
vulnerability of local water sources, but may instead
stem from broader changes in public opinion and policy
related to the needs of other water users.
For this probability analysis, you
should decide on a consistent planning horizon that
meets your needs, such as five, ten, or twenty-five
- Source vulnerability: How
secure are your current sources? What is the likelihood
that you will need to seek alternative sources? Factors
to consider include weather patterns, such as drought,
catastrophic events, infrastructure failure, contamination
from spills, increased demands from higher priority
users, changes as a result of regulation, public policy,
judicial action, or political conflict.
- Water price: What is the
likelihood of direct water price increases? What is
the likelihood of indirect price increases that result
from changes in water availability? Examples of indirect
costs increases include energy costs, key supplier
inputs, or transportation costs.
- Water quantity: What is
the likelihood of future restrictions on current water
- Water quality: What is
the probability that the quality of the water used
for this activity will change?
For the Module 2 risk assessment,
probabilities can be assessed using simple "high,
medium and low" ratings.
to Module 2