In 1954, Lewis Strauss, then chairman of the Atomic Energy Commission, gave a speech in which he famously predicted that “our children will enjoy in their homes electrical energy too cheap to meter.” Whether he was talking about fission reactors or a secret fusion project is unclear, but he was wrong in either case. What did turn out to be too cheap to meter, however, was water.

In 1954, Lewis Strauss, then chairman of the Atomic Energy Commission, gave a speech in which he famously predicted that “our children will enjoy in their homes electrical energy too cheap to meter.” Whether he was talking about fission reactors or a secret fusion project is unclear, but he was wrong in either case. What did turn out to be too cheap to meter, however, was water.

Unless you have a private well or spring on your property, you probably don’t enjoy free water in your home. But it’s a different story if you’re running a power plant or drilling for oil: The biggest water consumers pay the least for every gallon, and most power plants pay almost nothing at all. Perhaps that’s why so little research and funding is devoted to saving water — far less than is spent on energy efficiency.

This year’s drought, however, is a painful reminder that water is not an unlimited resource. According to the National Climate Data Center, moderate to exceptional drought currently covers 64 percent of the contiguous United States. A new study in the journal Nature Climate Change predicts that severe and widespread droughts will continue during the coming decades.

Though we live on a blue planet, if you were to gather all the water on Earth inside one gigantic water balloon, it would measure just 860 miles across. And, since oceans cover 71 percent of the planet’s surface, 98 percent of that balloon would be saltwater. Of the remaining freshwater, very little comes out of your faucets. A lot more of it comes out of your walls, in the form of electricity. A June 2012 report from the watershed-protection group River Network found that, for every gallon of water used in an average American household, five times as much water is used to provide that same home with electricity.

It takes water to make energy. Coal, gas, and nuclear power plants generate electricity using steam-driven turbine generators. They withdraw surface water from rivers, lakes, or other bodies and use it to cool the steam. Thermoelectric power production has been the largest category of water use in the United States since 1965, and it is currently the fastest-growing user of freshwater. In fact, thermoelectric production accounted for more than 41 percent of all freshwater withdrawals in 2005, the most recent year for which US Geological Survey data are available. That year, thermoelectric production consumed more than 200 billion gallons of water daily. That was about 675 gallons per person. Every. Single. Day.

According to a 2011 report from the Union of Concerned Scientists, water withdrawals vary widely from one type of power plant to another: “On average in 2008, plants in the US nuclear fleet withdrew nearly eight times more freshwater than natural gas plants per unit of electricity generated, and 11 percent more than coal plants.” The mining of coal, oil, gas, and uranium together consumes less water than power production does. But that’s not saying much. The mining category is expanding quickly, spurred by a boom in unconventional fossil fuels like shale oil and gas. In the Bakken shale of North Dakota, for example, where rainfall is less than 15 inches per year, drillers inject up to 800 truckloads of pressurized water into each well in order to extract oil.

Rather than treating water as a valuable and sacrosanct commodity upon which our lives depend, we have come to see it as an entitlement. While American households pay a premium for all the water-generated electricity found in their walls, those same households also expect cheap, potable water to issue forth from their taps at will. As do major energy companies, who expect water to be made available to them as though it were an inherent right. The US Army Corps of Engineers has issued temporary, no-cost permits to Bakken oil drillers, allowing them to siphon water from the Missouri River, and state representatives say they will fight any attempt by the federal government to charge for the water.

It takes energy to make water. Before you can use water in your dishwasher or bathtub, it must be pumped out of the ground or a surface source, treated to make it potable, delivered to your home, and heated. All of that takes energy. Plus, energy is required to treat and dispose of the wastewater that goes down your drain. In places where water is especially scarce, the only option may be desalination — an extremely energy-intensive process. And while thermoelectric power plants pay little or nothing for their water, water utilities get big electricity bills. (Remember, electricity isn’t too cheap to meter.)

A 2009 River Network study explored the flip side of the water-energy relationship, estimating that US water-related energy use is at least 521 million megawatt-hours per year — equivalent to 13 percent of US electricity consumption and double the amount generated by all the country’s hydroelectric dams. It doesn’t help that the US plumbing system is leaking an estimated seven billion gallons of water per day, earning it a D-minus grade from the American Society of Civil Engineers. To add insult to injury, this wasted water has already been treated to ensure that it meets drinking-water standards.

Energy-water collisions. This year’s summer is not only dry; it’s hot. According to National Oceanic and Atmospheric Administration scientists, July was the hottest month in the contiguous United States since recordkeeping began in 1895. And what happens in hot weather? People crank up air conditioners, increasing the need for energy — which, in turn, increases the need for water. As the climate changes, we’ll see even more hot, dry summers, causing what the Union of Concerned Scientists calls “energy-water collisions”: If there isn’t enough water to cool power plants, or the water is too hot to be used, power plants have to cut back on production or close.

For example, one of two units at Connecticut’s Millstone nuclear power plant shut down on August 12, because the water in the Long Island Sound was overheated. It was the first time in the plant’s 37-year history that Millstone found itself in, er, hot water. So energy-water collisions are already occurring, and they will only get worse.

A study in Nature Climate Change modeled the combined impacts of lower summer river flows and higher river temperatures and concluded that the summertime capacity of US power plants could decrease by as much as 16 percent beginning in the 2030s. The study also predicted that the probability of extreme (more than 90 percent) reductions in power production would triple. Get ready for hotter weather and less relief.

Saving water, saving energy. Luckily, there are solutions in plain view, including some low-hanging fruit. A “G-Science” statement on the linkage between water and energy, issued by the national science academies of 15 countries before the G8 Summit three months ago, recommended integrating water and energy programs, and investing in water efficiency as well as energy efficiency.

Monitoring by Idaho Rivers United, for example, has revealed that reductions in domestic hot water consumption could make a big dent in energy use and carbon emissions. That’s because hot water contains a tremendous amount of “embedded” energy — energy to transport, treat, and heat it. Surprisingly, simple improvements in water efficiency (switching to low-flow showerheads, for example) are often more cost-effective than improvements in energy efficiency (such as installing better light bulbs).

“Water efficiency research, as well as consumer retrofit programs, should be incentivized on a par with energy efficiency programs, because they yield documentable energy savings,” testified Mary Ann Dickinson, president and CEO of the Alliance for Water Efficiency, at a July Senate subcommittee hearing to examine the role of water use efficiency and its impacts on energy use. “To date, funding has been limited and insufficient, given the chronic need. For example, in the past 10 years only $3.5 million has been spent by the EPA on water efficiency research, a fraction of what has been spent by the Department of Energy on energy efficiency research.”

All of the above: energy and water. When water efficiency is factored into the equation, alternative energy sources, like wind turbines and solar cells, compare more favorably to coal, gas, and nuclear power. And thus, it becomes obvious — blindingly so — that thermoelectric power plants need to switch from “once-through” cooling systems to recirculating systems.

The drought has made it clear to most Americans — though, sadly, not to our political leaders — that water efficiency is essential to smart energy planning. For far too long, water and energy experts have existed in separate realms; they are finally finding one another at the water-energy nexus. Now it’s time to redefine “all of the above,” the phrase both presidential candidates have embraced to describe their energy policies. Mitt Romney needs to rethink his opposition to government support for water-efficient technologies, and both he and Barack Obama should focus a lot more attention on conservation — the cheapest, safest, and most expedient solution to energy and water problems. In a year when drought, record-breaking heat, and dire scientific warnings about climate change are making headlines day after day, neither candidate has yet grasped that “all of the above” isn’t just about energy but also about that most essential — and increasingly scarce — ingredient of human life. It’s the water, stupid.