Water shortages increasingly threaten Germany’s economy and ecosystems – report

Germany’s water storage deficit is increasing, as more water is lost than restored countrywide, said a report by the Boston Consulting Group (BCG) and climate NGO NABU. These shortages disrupt existing ecosystems, and increase risks of severe droughts, flooding, and decreasing water quality and accessibility, thereby creating economic costs of at least 20 to 25 billion euros annually.

These estimates include the direct costs of droughts, such as lower crop yields; damages to infrastructure induced by flooding; and water treatment costs following pollution incidents. They also include the less direct costs as a result of chronic water stress, such as growing competition over water as a scarce resource.

Failing to address this could cost Germany 500 to 625 billion euros in total until 2050, the authors said. They added that changing climate conditions, such as shifting rainfall patterns, and the increasing frequency of both droughts and flooding, are accelerating the growing water storage deficit in Germany, in combination with unsustainable land use practices.

Both climate and land use-related drivers have led to an estimated loss of 60 billion cubic metres of stored water in Germany in the past two decades, the equivalent to Germany’s largest lake, Lake Constance, the researchers estimated.

To counter the growing water shortage, managing water runoff at the surface is the most effective approach, the report showed. Nature-based solutions that increase the amount of water that can be retained by landscapes, and that optimise water use, have the highest positive impact on stored water levels. In particular, regenerative agriculture, water-smart forest management, and adapting agricultural drainage to current soil moisture would add approximately 7 to 7.5 billion cubic metres of water, which would be enough to overcome Germany’s water storage deficit.

The report also emphasises the importance of public recognition of water as a limited, strategic resource, that requires collaborative, cross-sector management. “Water must be understood not as an isolated input or a private commodity, but as a shared system of interdependence,” the report concluded.

Climate change is putting Europe’s water resources under immense pressure. Without swift mitigation and adaptation measures, not only will ecosystems and public water supply be under threat, but so will agriculture, inland navigation, and power production. In Germany, times of too little water, for example, affect navigability of the country's most important shipping route, the Rhine river, as well as impact crop yields and damage forests. The situation is set to intensify as climate change progresses, a 2024 report by the Federal Environment Agency (UBA) found. All the while, water use could increase in future, for example through the expansion of data centres in need of cooling, and battery and semiconductor factories.