When you think of cleaning a city’s dirty drinking water, it’s easy to imagine using giant plants or some tiny new portable technology. But one of the most effective ways to provide cleaner drinking water may be to protect and restore nature.

Urban areas globally spend an estimated $90 billion a year on water infrastructure, and watershed areas are a crucial part of that investment, a new report from The Nature Conservancy highlights.

On average, forests make up just 40 percent of urban watersheds, with 30 percent of the area being used for crops and 20 percent for pasture. In the developing world, the area used for farming is even higher, which causes water problems from fertilizer use and erosion, the report finds.

“Investing in nature can change how land use in source watersheds affects water quality—and, over time, possibly water quantity,” the report finds. Investing in nature in this case means things like saving and replanting forests, restoring rivers, and changing farming practices to limit runoff.

These strategies “could measurably improve the quality of water sources serving over 700 million people living in the 100 largest cities,” the authors find.

The idea that nature can provide services on par with traditional infrastructure investments has long been touted by environmentalists. It is now gaining more widespread recognition from unlikely places: companies with a history of pollution. Dow Chemical, for example, is working with The Nature Conservancy to evaluate the water use at its chemical processing plants and place a dollar amount on their environmental impact.

China may someday serve as a valuable case study for other countries looking to improve their water. Seventy-three percent of China's watersheds are significantly polluted, the report found. A problem like that is hard to ignore, and there seems to be a recognition that conservation can help provide China with clean water.

About 16 years ago, China kicked off the world's largest conservation program, which aimed to restore the country's forests. The effort appears to be working, according to a study released last month from Michigan State University. By paying farmers and former loggers to serve as stewards of the country’s woodlands, instead of simply banning deforestation, the country gained much more forest than it lost in the decade after it kicked off the program.

Between 2000 and 2010, China recovered about 1.6 percent, or 61,000 square miles, of tree cover, the study found. That compares to the 0.38 percent, or 14,400 square miles, of forest cut down. Replanting forests is one of the five ways identified by The Nature Conservancy to help improve water quality.

“China’s environmental issues are very challenging -- everybody knows of the bad air quality and water pollution,” Jianguo Liu, the director of Michigan State University’s Center for Systems Integration and Sustainability who co-authored the study, told The Huffington Post. Compared to the country's widespread environmental blights, "the forests are a major exception," he added.

The key to the program’s success in China lies in the subsidies built in to deter logging and incentivize conservation. Some state-owned timber companies are paid to plant trees, Liu said. Rather than clearing land for crops, local governments instead pay farmers to monitor forests as watchdogs.

“This stick and carrot approach seems to really work well,” Liu said. “It’s different from many previous policies that just said, ‘Oh, you can’t do this.’”

It may prove a difficult model to emulate in other countries. The Communist Party in China maintains authoritarian control over the country’s politics and economy, allowing it to make sweeping decisions with little pushback from would-be opposition leaders. People who live in Western-style democracies might recoil at such unfettered power in the hands of a government, but when addressing the slow-moving disaster that is human-caused climate change, it can be an asset.

“If the Chinese government realizes something which is important to do, they can do it very fast,” Liu said. “To some degree, it’s unique."