The latest installment in my compilation of the unintended consequences of new energy technologies: “clean” power projects can be giant water hogs. (Here’s part I and here’s part II.)

The New York Times reported today that utility-scale solar energy projects in the sun-rich but water-poor Southwest and California are running into obstacles as project developers compete with local interests for access to water. One proposed solar project in Nevada, for example, would have used some 1.3 billion gallons of water per year.

If water is the new oil, water-guzzling energy installations will face justifiable skepticism, especially in dry areas.

The article references BrightSource, a solar developer with a relatively less water-intensive approach to power generation. It quotes BrightSource investor (and my new favorite VC) Alan Salzman of VantagePoint Venture Partners explaining his decision to invest in BrightSource:  “Our approach is high sensitivity to water use …. We thought that was going to be huge differentiator.”

As alternative energy sources are developed and deployed, it clearly critical that investors, developers and regulators consider the big picture environmental impacts of new projects.

What’s your perspective?