Synergistic effects between water and energy policies are still not fully considered in Shaanxi province of China. To address the challenges of water scarcity and growing energy demand, the water–energy nexus of Shaanxi is investigated in this paper by input–output analysis (IOA). The findings indicate that water and energy resources are interdependent on each other. It is observed that agricultural water use intensity is 0.28 m³ per USD and industrial water use intensity is at the lowest level of 0.013 m³. Therefore, there is a huge water saving potential in the agricultural sector. Owing to the high energy consumption in agricultural irrigation, reducing irrigation water is of benefit both for water saving and energy conservation in the agricultural sector. Meanwhile, the industrial sector accounts for 63.8% of total energy consumption in Shaanxi, and it is urgent to change the economic structure to service-based rather than agricultural or industrial activities. It is believed that integrated strategies and planning are more favored in the future in Shaanxi. Water use limitation, energy mix adjustment and pricing mechanisms should be involved in water and energy policy formulation. Remarkably, because of being low carbon and water saving, the natural gas industry will become increasingly promising in the following decades.

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