Cheap clean water is the most valuable resource on the planet without a doubt. It is needed and used in every industry. The oil production industry uses a significant amount of it. So does all mining and resource extraction.
In agriculture in particular obviously we are talking 1000 and 10,000 to 1 ratios for the production of food. A quarter pound of hamburger requires 110 gallons alone. Imagine the amount of energy required to clean that much water and having to include it in the price.
Incidentally forget about the drought in southern California which is a desert. We get the vast majority of our water from the mountains of northern California. There is plenty of water there even in a "drought". The problem is the farmers in California which produce a significant amount of the worlds food. They are water greedy. People watering their lawns and cars in LA is a drop in the bucket compared to farmers.