REPORT: Water Demand Offset Programs Offer a Path to Sustainable Community Development

Net Blue Initiative Will Help Communities Pursue Water-Neutral Growth


Net Blue Logo smallerCHICAGO, Ill. (January 26, 2015) -  Amidst growing demands on water resources, water demand offset and water-neutral growth programs show promise as an effective way for communities to support sustainable growth, according to a new report released today by the Alliance for Water Efficiency (AWE).

As the U.S. population continues to grow and urbanize, planners and decision makers are becoming increasingly challenged with the task of accommodating new water customers with existing and possibly limited water supplies. Nearly 40 out of 50 states are experiencing or anticipating water shortages in the next decade, creating potential challenges for growing communities and industrial centers in both arid and traditionally water-rich regions.[1]  

“Communities need to reevaluate traditional planning approaches if they are to support increasing population and economic expansion in the coming years – particularly in areas with high growth and stressed water supplies,” said Mary Ann Dickinson, President and CEO of the Alliance for Water Efficiency. “Innovative strategies and new land use planning tools that consider and address natural resource constraints can help communities to thrive and become more resilient to potential climate-related impacts.”    

AWE’s report, Water Offset Policies for Water-Neutral Community Growth, reviewed 13 communities throughout the United States that currently have a water demand offset policy or water neutral growth policy in place. These policies require offsetting the projected water demand of new development with water efficiency measures to create a “Net Zero” or neutral impact on overall service area demands and water use. The report found that the most common scenario where this has been applied entails issuing building permits for development that requires offset of the new water use through both on-site water efficiency measures and replacement of inefficient fixtures in pre-existing facilities. In numerous California communities and in cities ranging from Santa Fe, New Mexico to Sharon, Massachusetts, water demand offset programs have been utilized to help enable new construction that likely would have been prohibited due to supply constraints.

"We examined communities in which water demand offset programs have been applied and found that they seem to be effective, but that this is not a widely implemented practice,” said Bill Christiansen, Program Manager at the Alliance for Water Efficiency.  “We believe one barrier is the lack of a standard approach to determine how much water a specific action will save. A clear methodology for calculating savings would help communities more easily adopt a water demand offset strategy and ensure success.” 

To guide more communities to utilize these strategies, AWE has partnered with the Environmental Law Institute and River Network to launch Net Blue, a new initiative aiming to offer a practical path to sustainable community development. The three organizations are developing a model ordinance template, including a consistent and industry-approved methodology for calculating offsets to ensure desired water savings, which communities can tailor to create a water demand offset approach that meets their needs. 

Water_Offset_Cover_AWE’s report also revealed what components are necessary for a successful and sustainable ordinance or policy. This includes not only a methodology for estimating savings of eligible efficiency measures, but also a water demand offset requirement in proportion to projected demand, mechanisms to verify implementation of efficiency measures, and polices to ensure demand reductions are permanent.

“The Net Blue effort will help cities such as San Francisco that must balance growth projections with limited water supplies,” said Paula Kehoe, Director of Water Resources of the San Francisco Public Utilities Commission. “A customizable ordinance, based on best practices and developed by water and land use experts is a valuable and timely resource.”

The project will preview the ordinances in communities in different regions throughout North America to develop the ordinance components and to ensure it is adaptable in communities with diverse political climates, legal frameworks and environmental challenges. The project partners are seeking additional pilot/partner communities to participate.  

Further information on the Net Blue initiative and the full Water Offset Policies for Water-Neutral Community Growth report are available here

About the Alliance for Water Efficiency  

The Alliance for Water Efficiency (AWE) is a nonprofit organization dedicated to the efficient and sustainable use of water in North America. Working with more than 400 water suppliers, business and industry, regulatory and advocacy organizations, AWE delivers innovative tools and training to encourage cost-effective water conservation programs, cutting-edge research, and policy options necessary for a sustainable water future.  For more information, visit AWE’s website, like AWE on Facebook, join the discussion on LinkedIn and follow AWE on Twitter @A4WE.


Megan Chery
Alliance for Water Efficiency
(773) 360-5100


[1]U.S. Government Accountability Office. (2014). FRESHWATER: Supply Concerns Continue, and Uncertainties Complicate Planning. (