The nation's energy choices embody many tradeoffs. Water use is one of those tradeoffs. The energy sector is the fastest-growing water consumer in the United States. Projections attribute to the energy sector 85% of the growth in domestic water consumption between 2005 and 2030. This projected growth derives from anticipated demand for more energy, increased development of domestic energy sources, and greater use of water-intense energy alternatives. Much of the energy sector's growing water demand is concentrated in water-constrained regions. Affordable water supplies are limited, and competition for water is becoming more intense. Whether the energy sector helps exacerbate or alleviate future water tensions is influenced by current energy policy and investment choices. These choices also may determine whether water limits or harms the nation's ability to reliably meet energy demand. Water limitations may hinder some water-dependent energy activities in specific locations. Water already plays a significant role in the energy sector, and water use by the energy sector already shapes national water use. For example, more than 80% of U.S. electricity is generated at thermoelectric facilities. With few exceptions, these thermoelectric power plants are cooled with water. In 2005, withdrawal of water for cooling represented 41% of water withdrawn nationally, and 6% of the water consumed nationally. The more water used by the energy sector, the more vulnerable energy production and reliability are to competition with other water uses and water constraints such as droughts. Climate change impacts on water supplies in some regions may exacerbate this vulnerability. Water availability can affect both existing and new energy activities, as well as all those economic activities that depend on the fuels and electricity produced. The energy sector is changing. Paths chosen and capital investments made in the near term are likely to establish long-term trajectories for energy's water use. Trends indicate that energy's changing water use has national and regional significance for water consumption. A question for Congress is: what is the appropriate federal role in responding to energy's water demand? In the aggregate, current federal energy policies contribute to energy's rising water demand, while energy interests and the state and local governments are responsible for managing and meeting water demands and resolving competition over water resources. Questions for Congress include who is the most appropriate entity to respond to energy's growing water demand and water vulnerability and how to respond. At present, little direct federal action is aimed at managing the energy sector's water demand; instead, the current division of responsibilities relies on energy interests and state and local governments to meet and manage energy's water demand and resolve energy-water conflicts. The role of federal policies in contributing to rising water demand is bringing into question the future federal role in this policy arena. Local or regional competition for water with existing users is often what makes energy's water demand significant; at the same time, the regional and local scales of water resources availability and management complicate many federal water-related actions. Options for managing and meeting energy's water demand range from maintaining the current approach, with little federal action targeted at managing energy's water demand, to taking a variety of federal actions. One option is to minimize growth in energy's freshwater use. This could be accomplished through changes to broad policies (e.g., energy demand management) or legislation specifically targeted at water use (e.g., promotion of water-efficient energy alternatives). Another option is to improve the energy sector's access to water. Access is generally a responsibility of the state, but some limited federal actions are possible. An additional option is investing in data and research to inform decision-making and expand water-efficient energy technologies. These alternative policy approaches, which are not mutually exclusive, represent different potential roles and costs for the energy sector; energy consumers; and federal, state, and local governments. Legislation in the 111 th Congress proposed many of the above options; examples include H.R. 469 , H.R. 2454 , H.R. 3598 , H.R. 1145 , S. 1462 , S. 1733 , S. 3396 , and Subtitle IV of P.L. 111-11 ( H.R. 146 ), the Secure Water Act of 2009. During the 112 th Congress, energy's water use may arise in a variety of contexts, including during consideration of energy, agriculture, public land, and water legislation and oversight. While the water tradeoffs of energy choices may be raised in a variety of contexts, they are unlikely to be the focus of energy debates. Instead, the priority on and investments toward different policy goals—low-cost reliable energy, energy independence and security, climate change mitigation, and job creation—are likely to be more significant drivers in congressional energy deliberations. This report focuses on the factors shaping the energy sector's water demand, how that demand fits into national water consumption, and options for managing and meeting water demand. The report first lays out the trends shaping energy's water use; second, it discusses energy's vulnerability to water constraints; and third, it discusses projections of energy's water use. It then explores three regional examples of energy's water use: shale gas in Texas, solar energy in the Southwest, and biofuels in the High Plains. Finally, it discusses policy options and legislative approaches for managing energy's water use. Several appendixes provide more detailed information on specific technologies, fuels, and trends. The report does not discuss in detail the energy sector's water quality impacts, although they represent their own challenges, as shown by concerns over the water quality effects of hydraulic fracturing, mountaintop mining, and the Deepwater Horizon oil spill. Energy use by the water sector also is not discussed in this report, although water conservation is one of many available means for reducing energy demand. Trends in national energy investments, domestic energy use, population, and climate change impacts and responses can affect how much and where the energy sector uses water. Increased emphasis on domestic energy production and efforts to meet increasing energy demand are expected to increase freshwater use by the energy sector. A shift in the electricity sector away from traditional coal power plants may result in either more or less water consumption, depending on alternative fuels or electricity technologies. Carbon capture and sequestration (CCS) by electric utilities has the potential to consume significant quantities of water. Actions such as substituting wind for thermoelectric electricity generation could potentially reduce energy's water demand, but may raise other challenges for energy reliability, dispatchability, and transmission. Other impacts, such as the movement of irrigated agriculture from food crops to energy crops, raise other concerns. These and other examples of energy trends and their effects on energy's water use are summarized in Table 1 . Appendix A has a more extensive list of trends. Whether and how much the energy sector's water demand grows in the next decades will be significantly influenced by whether energy demand increases. Projections of the size and mix of the future energy portfolio vary widely. These projections are highly uncertain and are sensitive to many factors, including market and economic conditions, energy and agricultural policies, resource availability, technology developments, and environmental regulations. By association, projections of energy's water demand also are highly uncertain. The Energy Information Administration (EIA) in the Department of Energy (DOE) projects that the United States will consume 22% more electricity and 12% more liquid fuel in 2030 than in 2010. Population growth and increased electricity use per capita are some drivers of increasing demand. Significant shifts to more water-intense electricity generation (e.g., concentrating solar power facilities using evaporative cooling) or more water-intense fuels (e.g., oil shale) could increase energy's water demand in locations with these energy resources. The significance of energy's water demand depends in part on local conditions—how much water is locally available and what its alternative uses would be. The most growth in freshwater consumption by the energy sector is expected in the Southwest, the Northwest, and the High Plains—that is, regions already experiencing intense competition over water and disputes over river and aquifer management. The more freshwater used by the energy sector, the more the sector is vulnerable to water constraints. However, as described above and in Appendix A , major energy trends are pushing the sector to become more water-intensive. Water availability problems, especially regional drought and low streamflow, can pose a risk to energy production and reliability. Electricity generation is particularly sensitive to low-flow conditions. More than 80% of U.S. electricity is generated at thermoelectric facilities that depend on access to cooling water. Low-flow conditions and water scarcity may constrain water-intense alternatives for thermoelectric cooling in counties across the country. Additional ways that water can constrain energy include a possible decrease in hydroelectric generation during drought. Bioenergy yields may be reduced by low precipitation, droughts, heat waves, or floods. Energy extraction, like coal mining, may be scaled back to avoid water quality impairments exacerbated by low water conditions. While water constraints are often perceived as an issue for the western United States, an increasing number of water bodies in the East are experiencing diminished stream flows. While multiple examples exist of water availability affecting siting and operations of thermoelectric facilities from New York to Arizona, generally there are ways to reduce the use of water and the risk posed by water constraints. Water supplies often are most constrained during summer, when the energy sector's water use is at its height in many regions. Approximately 24 of the nation's 104 nuclear reactors are situated in drought-prone regions. The Nuclear Regulatory Commission sets minimum source water elevation levels for each plant, so that a plant does not operate when source water levels drop below plant cooling water intakes. If cooling water sources fall below the established minimum water level, or if the maximum thermal threshold for the discharge of cooling water cannot be met, a facility is required to power down or go offline. A commonly cited example of this occurred on August 16, 2007, when a nuclear reactor owned by the Tennessee Valley Authority (TVA) at the Browns Ferry Nuclear Power Plant in Alabama shut down for a day.