...agents were unable to support language in bid documents, officials say. They now plan to rebid the job in mid-July after some rewriting. The utility estimated bids to exceed $150 million when the job was announced last year, but sources say they are expected to come in at around $250 million.
Bidding complexities producing fewer bidders are prompting environmental infrastructure owners to seek new approaches. “We’ve seen an increase in alternative procurement methods other than low-bid, hard-dollar contracts, including prequalification and at-fee program managers,” says Pester. “It’s an area we want to grow.” He says western utilities are looking more favorably at design-build for water delivery projects.
Action. U.S. is funding work to expand water and wastewater capacity in Afghanistan. |
(Photo courtesy of CDM)
Firms also see the trend on non-U.S. projects. “Design-bid-build is unusual internationally, except when applied by Americans,” says Bill Webb, executive vice president of Earth Tech. The Agency for International Development is pushing DB on jobs it funds in Afghanistan and Pakistan, says CDM’s Fox.
On June 26, a group of nine major design-build firms in the water-wastewater arena announced formation of the Water Design-Build Council, a Washington, D.C.-based group that will promote the practice for environmental infrastructure. “Our goal is to enable municipalities to realize the full benefits,” says Mark Alpert, council president and a CH2M Hill executive.
Firms also see more work in environmental science and management, including permitting and due diligence. They each rose nearly 20%. Kleinfelder was picked to handle air and water permits for Midwest Ethanol Producers Inc.’s $95-million plant in O’Neill, Neb., to produce 50 million gallons of ethanol per day. Russ Erbes, chief technical officer, says air emissions curbs are strict.
The sector growth lured Bureau Veritas, a Paris environmental management firm that works globally, to buy out Clayton Group Services Inc. last year. Business development director Rick Aspray expects tougher site assessment and contaminant exposure regulations to spur more work in the U.S.
Parsons Brinckerhoff sees environmental planning “as a huge investment area” for the transportation firm, says Lisa Nungesser, national director for planning and environmental services for PB Americas. “We’re assessing how they can grow related to our core business.”
If the U.S. market wasn’t enough, Top 200 companies also found new revenue abroad, many by following multinational clients. Stronger European Union rules and new U.K. mandates for environmental impact statements for structures 25 stories or higher are drivers.
While firms in other sectors are drooling over the China market, Top 200 firms seemed to find a “not welcome” sign. “We consider it a weak market for traditional services,” says Fox. Asia revenue dropped .2% last year.
The Middle East, with its booming oil revenue, was the global oasis. The market zoomed 160% in 2005. Some had environmental work as part of Iraq reconstruction, but others see action in Arab Gulf states. CH2M Hill’s Abdelhamid says Kuwait is set to start remediating 600 oil wells blown up in 1991 by Saddam Hussain during the Gulf War.
“We see robust growth for the next several years, up to 15% and higher in the Gulf states,” says David Backus, president of Parsons Water and Infrastructure. “The population is growing and moving and Mother Nature doesn’t make any new water. Water is the oil of the 21st century.”