This talk suggests a framework for evaluating water and energy demands and the impact of climate change on water energy systems.   Successive sections of the talk  (1) organize water system activities according to their responsiveness to water and energy prices, (2) indicate the likely the impact of climate change on water and energy prices, (3) evaluate the likely direction and magnitude of price effects on selected components of the water system and (4) suggest priority research to more accurately forecast trends in future water and energy demands.