(Bill Holman, a former secretary of the state Department of Environment and Natural Resources, is director of state policy at the Nicholas Institute for Environmental Policy Solutions at Duke University.)

I believe that this drought, combined with awareness of a rapidly growing population and a warming climate, has convinced many people that the era of cheap and abundant water is over.

However, most of our public and private water utilities are still using a 20th-century business model that depends on selling gallons of water to pay capital, operating and maintenance costs. That model worked well in the 20th century, when water was abundant. It failed in the drought, when water was scarce.

Our utilities need to change their business model to sell water services instead of gallons. Customers want water services -- hot showers, clean clothes, clean dishes, sanitation and healthy landscapes -- not gallons.

If our utilities help us become more efficient, we may pay more per gallon, but we will use less and keep our bills reasonable. Increasing efficient use of water also increases efficient use of energy. Pumping, treating, heating and cooling water requires vast amounts of energy.

Cooling coal- and nuclear-fired power plants requires vast amounts of water. Increasing energy efficiency reduces demands for cooling water. Installing, operating and maintaining more efficient fixtures, appliances, toilets and landscapes requires skilled labor and creates opportunities for new companies and trades.

During the drought, we stopped irrigating our gardens and landscapes with drinking water. We flushed our toilets with drinking water less frequently. We began to ask, why are we using highly treated, valuable drinking water to flush our toilets, water our lawns, cool our buildings and wash our cars?

Shouldn't we capture and reuse the water running off our rooftops and driveways for irrigation and cooling -- like the General Assembly has done?

In the 20th century, stormwater was an expensive water quality problem. In the 21st century, stormwater should become another source of water.

Shouldn't we also reuse treated wastewater for industrial processing, cooling and irrigating golf courses -- instead of drinking water? And reduce wastewater discharges into the Neuse and other rivers? Treated wastewater should also become a resource in the 21st century.

Global competition for water, energy and materials is increasing. We must apply new technologies, markets and policies to transform the way we use these resources to sustain our economy and environment.