Demand for water could outstrip supply by 2035 in parts of northern England, according to a report.

Recent focus on near-future water shortages has been on dry south-east England, where London’s consumption of water already outstrips supply in dry years, and the water companies that serve the capital are located in areas classified as seriously water stressed.

But the report for the thinktank IPPR North warns that, despite its abundance of water, the north could also become water stressed, with significant reductions in rainfall and water flow alongside population increase, economic growth and shortcomings in water companies’ efforts to reduce leakage. The report says northern powerhouse projects could be at risk unless politicians plan ahead for the climate crisis.

In Yorkshire and the Humber, demand could outstrip supply by 2035 unless households and businesses reduce their water use, the report warns.

Although leakages are down by 38% from their mid-1990s peak, leakage rates have flatlined over the last decade. Household water use is slowly reducing, but the current average of 141 litres per person per day is still significantly higher than Germany’s 121 litres per day, according to the report.

The north accounts for 41% of all water abstracted across England, but it relies far more on surface water than elsewhere in the country. With global heating, the likelihood of drought is projected to increase while average summer river flows may decrease, reducing water availability, even as the risk of flooding is likely to increase, particularly in winter.

Facebook Twitter Pinterest York after the Foss burst its banks in 2015. The report says more floods, as well as droughts, are likely. Photograph: Jeff J Mitchell/Getty Images

The report says: “Although much of the north – unlike parts of the south of England – is not considered water stressed, the region’s water security cannot be taken for granted. There are very limited opportunities to substantially increase the supply of water, for example by building new reservoirs, because of a lack of water availability, abstraction limitations, and the likely impact upon the natural environment.

“Instead, to ensure the region remains water resilient, we will have to make better use of our existing water supply by managing demand, reducing leakage and encouraging greater water efficiency.”

While the north-east is expected to have a water surplus for several decades, water could also become a valuable asset to the north-west, with water management schemes potentially enabling it to supply other regions of England.

Jack Hunter, the author of the report and a research fellow at IPPR North, said: “This is a shared problem that requires shared solutions. Water companies need to deliver on their plans to dramatically reduce leakages, and households, businesses and political leaders all need to treat water much more responsibly in future.”

The report also recommends that water companies should be legally required to be part of any strategic planning processes and consultees on individual planning applications.

The Environment Agency has warned that England could run short of water within 25 years unless drastic action is taken to stop leaks, improve efficiency of water usage in the home and transform public attitudes.

“We need water wastage to be as socially unacceptable as blowing smoke in the face of a baby or throwing your plastic bags into the sea,” said its chief executive, Sir James Bevan, earlier this year.

According to the agency, it will be necessary to build controversial reservoirs, as well as energy-intensive desalination plants such as the one at Beckton on the Thames, which has supplied water to London since 2010.