The global agrifood system is currently operating at an unsustainable intersection of resource depletion, climatic instability, and rising economic hidden costs. As of 2024, the Food and Agriculture Organization (FAO) and the World Bank have highlighted that hidden costs within global agrifood systems, encompassing environmental damage, health impacts from poor nutrition, and social inequities, amount to approximately $12 trillion annually. This staggering figure underscores the necessity for national governments to prioritize a radical transformation of their agricultural operations. Transitioning toward energy-smart and water-secure systems is no longer a matter of environmental idealism but a core requirement for national economic stability and food security.
Agrifood systems account for approximately 30 percent of globally available energy consumption and contribute to 31 percent of total greenhouse gas emissions. This energy use is heavily skewed toward post-farmgate activities, with 70 percent of consumption occurring in transportation, processing, packaging, shipping, storage, and marketing. Furthermore, nearly one-third of the food produced is lost or wasted, representing approximately 38 percent of the total energy consumed in the system. In tandem with energy inefficiency, agriculture remains the primary consumer of the world’s freshwater, accounting for 70 to 80 percent of global withdrawals. To meet the demand of a projected population of 10 billion by 2050, average farm yields must double in major cereal systems, an objective that can only be met through a significant increase in water-use efficiency and a decoupling of production from fossil fuel reliance.
Governments must facilitate a transition toward energy-smart systems that are efficient, sustainable, and resilient. This transition requires moving away from the industry's heavy dependence on fossil fuel inputs, which currently accounts for a substantial portion of greenhouse gas emissions. Decarbonization by mid-century is viewed by international bodies as impossible without addressing the energy intensity of food production. A critical first step in this prioritization is recognizing that different types of farming, from industrialized corporate entities to small-scale family farms, require tailored solutions.
Source: https://www.fao.org/energy/en
Below we explore how the US, EU, and GCC can prioritize energy and water efficiency in agriculture, highlighting innovative solutions like agrivoltaics, precision irrigation, and advanced greenhouses, followed by actionable policy steps.
In the United States, agriculture’s resource footprint is enormous. Irrigation alone accounts for roughly 42% of the nation’s freshwater withdrawals, and agriculture makes up as much as 80–90% of U.S. consumptive water use. This means improving on-farm water efficiency is critical. American farmers are increasingly adopting precision irrigation, for example, drip and sensor-controlled systems, to minimize waste. Studies show that well-managed drip irrigation can reduce water usage by 26–65% compared to traditional flood methods, without sacrificing yields. This translates to huge water savings, especially in drought-prone Western states. On the energy side, U.S. agriculture is leveraging renewable energy to cut costs and emissions. Agrivoltaics – the practice of installing solar panels on farmland while growing crops or grazing livestock beneath – has seen a rapid expansion. U.S. agrivoltaic capacity doubled from about 4.5 GW in 2020 to 10 GW in 2024, now spanning nearly 600 dual-use solar farm sites nationwide. These systems generate clean power for rural communities while the panel shade can reduce soil evaporation and even boost certain crop yields. By embracing precision water management and on-farm solar, the US is moving toward climate-smart farming that produces more food with lower water and energy inputs.
The European Union faces a growing urgency to make farming more sustainable amid climate change. Agriculture in the EU accounts for around 29% of total water abstractions (with energy production and public supply also major users). Southern Europe, in particular, suffers frequent droughts and water scarcity. To address this, EU policymakers and farmers are prioritizing water-efficient farming techniques. Replacing old, leaky irrigation systems with modern drip or subsurface irrigation and employing smart farming (using soil moisture sensors, weather data, and AI for irrigation scheduling) could cut agricultural water use significantly – by up to 20% of current withdrawals, according to European assessments. In parallel, Europe is harnessing technology to align agricultural practices with its clean energy transition. Agrivoltaics and solar greenhouses are gaining traction as win-win solutions. Remarkably, research by the EU’s Joint Research Centre found that covering just 1% of EU farmland with agrivoltaic installations could deliver about 944 GW of solar capacity – more than the EU’s entire 2030 solar energy target. This highlights enormous potential to generate renewable energy on farms without competing for land. The EU is actively encouraging such innovations: the European Commission’s Solar Strategy and updates to the Common Agricultural Policy urge member states to integrate agrivoltaics into their national plans. By accelerating precision irrigation, drought-resistant crops, and farm-based solar power, Europe aims to strengthen its food system’s resilience while advancing climate goals under the Green Deal.
For the GCC countries (e.g. Saudi Arabia, UAE, Qatar, and neighbors), water and energy efficiency in agriculture is a matter of survival. A staggering 75% of the GCC’s freshwater is consumed by agriculture, even though these desert nations have scarce rainfall and limited arable land. Historically, this led to heavy reliance on food imports and energy-intensive desalination for water. To change course, GCC governments are investing in cutting-edge agritech to produce more food locally with minimal water. Precision irrigation (like widespread drip irrigation and automated watering based on sensors) has become standard to eliminate the waste of flood irrigation. Countries are also turning to soilless farming: for instance, hydroponic and aquaponic greenhouses that can grow vegetables with up to 90% less water than traditional soil farming. These climate-controlled greenhouses (often powered by solar energy) allow year-round production of crops like lettuce and tomatoes in the middle of the desert. Another game-changer is agrivoltaics in the GCC’s sun-drenched environment. By installing solar panels over fields or integrating photovoltaics into greenhouse roofs, farmers generate renewable power and simultaneously shade crops from intense heat, which reduces soil evaporation and plant water demand. Such dual-use projects address the GCC’s high solar potential and water constraints in tandem. Combined with initiatives to reuse treated wastewater and develop salt-tolerant crops, these innovations help Gulf states conserve precious groundwater, cut energy costs, and improve food security despite harsh climatic challenges.
The economic rationale for government intervention is bolstered by the potential for cost savings and stability. In 2024, lower natural gas prices—a key input for nitrogen fertilizers—helped stabilize production costs after a volatile 2022. However, the long-term volatility of fossil fuel markets presents a persistent risk to food prices. Governments can mitigate this by investing in renewable energy integration at the farm level, such as the deployment of solar-powered water pumps and biogas systems derived from organic waste.
Agrivoltaics, or Agri-PV, represents a sophisticated method for governments to resolve the inherent conflict between energy expansion and agricultural preservation. As the urgency of climate change pushes for a rapid shift to renewables, projections suggest that solar and wind will provide the majority of the world's power by 2050. However, utility-scale solar projects typically require five to seven acres of land per megawatt of capacity, often displacing fertile cropland.1 Agrivoltaics provides a systems-level solution by allowing for the dual use of land, which can increase total land productivity by 160 percent or more.
The integration of solar panels over crops is not merely a technical innovation but a multidimensional strategy. Recent literature identifies six interconnected spheres of impact (6S):
Sustainability,
Soil-crop productivity,
Socioeconomic resilience,
Solar power generation,
Spatial efficiency, and
Species biodiversity.
By providing partial shade, PV panels reduce plant heat stress and evapotranspiration, which can boost yields in arid regions while simultaneously generating clean energy.
Beyond crop production, agrivoltaics serves as a mechanism for improving socioeconomic resilience. Farmers can diversify their income through lease agreements with energy developers, creating a financial buffer against crop failures or market fluctuations. For governments, this reduces the need for emergency agricultural aid and supports rural development goals.
Controlled Environment Agriculture, including greenhouses and vertical farms, offers the ability to decouple food production from climate-related risks like drought and extreme weather. By controlling variables such as light, temperature, and humidity, CEA systems can produce local food year-round while using up to 95 percent less water and land than traditional field agriculture.
Governments can further prioritize CEA through urban planning policies that integrate these facilities into city infrastructure, reducing the transportation-related carbon footprint of "farm-to-table" logistics. Incentives for renewable energy integration, such as on-site solar and battery storage, can move vertical farms toward energy neutrality, making them a more viable component of a low-carbon food system.
With agriculture constituting an estimated 80 percent of national consumptive water use in the United States, water-use efficiency is a critical pillar of national resource management. Traditional flood or spray irrigation methods are increasingly unsustainable as aquifers are extracted faster than they can recharge. Governments must transition from fragmented water management to a coordinated "circular water economy" that prioritizes reuse and precision application.
In developing countries, the transition to precision irrigation is often hampered by high upfront costs and a lack of technical expertise. Government prioritization must therefore include a shift from treating irrigation as an "expenditure" to viewing it as a long-term "investment" in national stability.
The data is clear: the era of "cheap" agricultural inputs, be it fossil fuels, groundwater, or land, has come to a close. As global hidden costs in the agrifood sector approach $12 trillion annually, the transition to energy-smart and water-secure systems is no longer a peripheral environmental goal; it is a foundational pillar of national security and economic sovereignty.
By strategically integrating Agrivoltaics to resolve land-use conflicts, scaling Controlled Environment Agriculture (CEA) to insulate production from climatic volatility, and deploying Digital Precision Irrigation to preserve depleting aquifers, nations can do more than just mitigate risk. They can build a food system that is a net-positive contributor to the economy and the environment.
However, the roadmap to resilience is not "one size fits all." The success of these frameworks depends on the ability of governments to bridge the gap between high-level policy and on-the-ground implementation. The transition requires a localized understanding of micro-climates, energy infrastructure, and economic incentives. Those who move first to de-risk their agricultural operations through technology and smart policy will be the most resilient in the face of the 21st century’s resource challenges.
Navigating the complexities of agrifood transformation requires more than just data, it requires a partner with a proven track record in system-level integration.
Agritecture Consulting is a global leader in providing data-driven solutions for the future of food. Whether you are a government body seeking to develop a national strategic framework, or a private enterprise looking to optimize energy and water efficiency through CEA or agrivoltaics, we provide the expertise to turn policy into practice.
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Ready to lead the transition to a more resilient agrifood system? Contact Agritecture Consulting today to discuss how we can help you design and implement your strategy for energy and water efficiency in agriculture.