The drinking-water treatment market is facing financing challenges.
"Restoring aging water infrastructures is a challenge due to cost. Only about one-third of water systems earn enough revenue to cover replacement costs," says Blair Lavoie, president of MWH Constructors. "The U.S. has a big water infrastructure gap—the level of treatment should be improved," comments Marie-Ange Debon, group deputy chief executive officer in charge of the international division of Suez. "In the U.S., it's a fragmented market with many small plants, which makes it difficult to share utilities and equipment. There is still a lot of investment needed in the U.S. to improve water quality."
Suez acquired GE Water & Process Technologies for $3.7 billion in September 2017 and now has approximately $10 billion in annual water revenues. The firm is involved in constructing water facilities in 70 countries and operates water or wastewater plants in more than 40 countries.
Investment needs differ in accordance with levels of development. "In developed countries, we see growth in rehabilitation work and projects to improve the quality of installations," says Debon. "Emerging countries have greater need for new primary infrastructure. China and India have more than 5% growth, and Southeast Asia, Africa and Latin America are also growing. There is also a second level of development to improve the quality of rivers in many countries."
Financing approaches are also shifting. "Many countries that have been postponing investment in water programs due to other priorities or budget constraints have started looking at implementing ambitious plans by way of recurring to private financing," says Silvio Oliva, chief executive officer of Fisia Italimpianti, a subsidiary of Salini Impregilo Group. "Argentina and Peru are two countries [that are going in this direction]. In order to succeed with this approach, there needs to be a valid legislative scheme and adequate guarantees."
"We are seeing an increase in alternative or integrated delivery, program management and other approaches to bring water infrastructure projects to construction faster," says Jonathan Pressdee, vice president and drinking-water market-sector leader at AECOM. "We are not just talking a traditional P3. This can be debt financing to kick-start projects and performance contracting for shared risk."
New Treatment Technologies
New treatment technologies are being adopted or evaluated. "One new method is using membrane filtration differently, reducing the need for chemical cleaning and less frequent backwashing to simplify operation, reduce life-cycle costs and, consequently, much reduced risk of fiber breakage," says Pressdee. "We also see developments with ceramic filtration materials as alternatives to polymeric membranes and potentially as a replacement for conventional media filtration over time. The enhanced pathogen-removal capabilities of these filtration systems are a major benefit when protecting public health. Reengineering of ion exchange resins targeting dissolved organic material also holds promise, as we treat increasingly challenging surface waters as we diversify our water supplies."
Automation also is bringing greater efficiencies to treatment plants. "More and more digital technologies [are being implemented] that allow real-time and remote detection and remote management of equipment and plants," explains Debon. "These technologies allow fully remote operation of pumping stations."
The aging workforce in the water sector is creating interest in plant automation. "Water-plant operators are retiring, and the public sector is losing experienced personnel," says Pressdee. "[The water industry struggles] to attract younger people to operate facilities. This struggle has made facility automation an attractive alternative. The trend is driving automation concepts—smarter controls, algorithms, data-driven approaches to managing infrastructure and so on."
"Data is in buckets now," comments Bob Hulsey, global practice rechnology leader at Black & Veatch. "We can now get it to a place where people can get it quickly so people can use it in dealing with emergencies."
The Impact of Climate Change
Mother Nature is also having her say. "Another market driver we have seen this year is the impact of climate change on water availability and demand and the social perception of and responses to water-related risks, such as droughts, floods and pollution," says Lavoie. "The devastating droughts and hurricanes we have encountered this year have caused a lot of concern in areas [such as] water and disaster risk management, water supply and quality, drainage and flood management."
Pressdee points out, “Severe weather events—like the recent fires and flooding—impact our surface-water and water-treatment systems. These events can change the chemistry of the water in the systems that can result in water-quality issues like taste, odor, algae and so on."
One example of a project directly linked to climate conditions is an advanced water-recycling plant that Suez broke ground on last month in Perth, Australia. The Perth region has experienced more than a decade of dwindling rain, which has impacted groundwater supplies. "This re-use plant will allow the city to treat water and achieve a drinking-water quality level while putting water back into the aquifer," comments Debon. The plant will employ ultrafiltration, reverse osmosis and ultraviolet disinfection, while recharging up to 3.7 billion gallons per year. It should be operational in 2019.
"Having come out of the long drought—at least temporarily—California is a good example of looking to alternative sources for water supply," says Hulsey. "The Orange County Water District is expanding their groundwater replenishment system. One of our inland clients is expanding its brackish water supply and looking to recover more of the water for potable use," producing less brine to discharge to the brine line.
"Whether highly treated wastewater effluent or brackish inland sources or seawater desalination—all [these types of reuse] are expected to be a growing and significant part of our water portfolio for the foreseeable future," says Pressdee.
Another emerging threat is algal blooms, a seasonal phenomena during the past five years on Lake Erie. "Concern for toxins produced from harmful algal blooms has resulted in an organized approach that regulators are adopting to ensure control of these chemicals in potable water," says Hulsey. "For instance, the state of Ohio has a requirement that utilities that measure mycrocystin in their raw water above a trigger value have to come up with a plan to address how those toxins would be removed through their existing treatment processes and/or additional treatment processes to be included in the future."
One nation making big strides is India. "It has been a very active market for the past two years," says Debon. "The country is trying to optimize its networks in order to use less water: improving water pressure by replacing pipes and installing new meters." The effort is taking place in Bangalore, Mumbai, Kolkata, Delhi and Pune.