From barely getting a mention last year, water scarcity and conservation has become a big issue at Davos in 2008, with a plenary and five other sessions.

The most interesting idea to emerge from a session this morning was the suggestion that market forces - specifically a market price for water - should be used to help prioritise use and drive conservation.

Nestle Chief Executive Peter Brabeck said such a move would cause a major rethink of production processes. In particular, production of biofuels — turning crops into energy — would not be viable if producers had to pay the true price of the water they use.      

 ”There is a need for there to be a price associated with water, ” he told a panel at the World Economic Forum annual meeting.     

 ”It takes 9,000 litres of water to produce one litre of biodiesel. This strategy, which is not the right one, is backed by all major governments.”      

Water has become a hot topic at Davos this year, with advocates arguing that changing diets, global warming and energy needs will rapidly cause scarcity and potentially drive political conflicts.      

Biofuels are now being produced in large scale and have been encouraged by governments hoping to tap renewable energy sources, drive down prices and reduce dependency on often unstable oil producing nations.      

Brabeck also said that increasing oil exploration would require huge amounts of water. He said that it now requires 2.5 litres of water to produce one litre of oil, but if plans go ahead to exploit heavy oil and oil sands that number would multiply to a ratio of between 20-100 to one.  

Photo credit: REUTERS/Stefan Wermuth