The water market is one of the world's five largest markets, amounting to $400 billion, and growing at 7% annually. In comparison, the $600 billion energy market is growing 1% a year. The semiconductor market is only half the size of the water market. In the U.S. alone, the water industry is expected to grow 7% a year to $150 billion. One factor driving this growth is that America's water systems—some of which were built during the Lincoln administration-- are crumbling. As a result, there are more than 200,000 water main breaks per year and as much as 80% of the water intended for delivery to consumers is lost en route. The nation's infrastructure for water delivery is in dire need of investment: the EPA suggests that $15 to $20 billion per year needs to be spent to address these issues versus current spending of around $3 billion per year.
The worldwide demand for water and water treatment is torrential. For instance, China plans to build 375 wastewater treatment facilities by 2009. The World Bank has estimated that in 2007 investments of between $400-$600 billion were made to meet the demand for fresh water.
Costs for treated wastewater in North America are usually between $1 and $39 per 1,000 gallons treated, while costs for USP purified water average $20-$60 per 1,000 gallons.
Industry
According to Stanford Washington Research Group, The global water market is widely estimated to be between $350-500 billion in annual revenues, with the U.S. market in the range of $95-150 billion. By any measure, the majority – about 60% of the total both in the U.S. and globally– comes from water and sewer utility revenues, most of which remain in the hands of local governments around the world.
The breakdown of the global industry is as follows: Municipal water & sewer revenues ($200-220 billion); Equipment & services ($75-80 billion); Contract services ($32- 40 billion); Transmission, delivery ($16-20 billion); and Chemicals ($13-20 billion).
The breakdown of the US market is as follows: Water and sewer utility revenues ($63 bil); Infrastructure construction ($19 bil); Treatment equipment ($8 bil); Treatment chemicals ($4 bil); Contract operations & maintenance ($4 bil); Consulting ($3 bil); Residential commercial POU/POE ($2 bil); and Analytical instrumentation ($1 bil).
Key Challenges
The outlook for growth in private sector participation in the municipal water and sewer markets that currently dominate the overall sector remains less clear. “Privatization” or “public-private partnership” in owning or managing water and sewer utilities remains highly controversial. Some environmental activists, along with many local government officials, remain vocally opposed to the private sector gaining a profit from bringing direct capital investment into the sector. However, private sector investment in government-controlled water systems, via taxes and tax-subsidized financing, or even charity, is fine.
The United Nations’ “Millenium Development Goals” state that 1.2 billion people already lack access to clean drinking water and 2.4 billion lack access to adequate sanitation, with these numbers continuing to rise. The UN set a goal in 2002 of reducing these numbers by half by 2015. However, Water is still largely taken for granted by consumers, governments, and even by industries that heavily depend on it. Corporations around the globe are at risk, since many industrial users – including agriculture, power, pharmaceuticals, food and beverage, microelectronics, and petrochemical – are dependent on a clean water supply to make their products.
According to the EPA in the US, 53,000 community water systems will need an estimated $277 billion over 20 years to upgrade their infrastructure in order to provide safe drinking water, with medium and large systems (those serving 50,000 people or more) comprising about 80% of the total. These include – transmission & distribution ($184b); treatment ($53b); storage ($25b); and source/supplies ($15b).
The second largest category of needs is treatment systems, which represent about $53 billion in total needs over 20 years and about $24 billion of current needs. This includes projects to install filtration, disinfection, corrosion control, and aeration, as well as associated chemical treatment, testing and automated monitoring and control devices.
According to the Census Bureau, In FY03, government entities collected about $63 billion in water and sewer revenues, but spent nearly $76 billion on their water supply and sewer systems.
Consolidation
Despite a flurry of M&A deals in 2004 and 2005, the industry is still heavily fragmented. The key industry players can be segmented into the following categories: · Water utilities, · Filtration and UV, · Diversified industrial companies with a water flavor, · Infrastructure services, and · Wholesale water rights.
Some of the key players are: French water companies, Suez and Veolia
Environnement; Siemens Water Technologies; GE Water and Process Technologies; Aqua America; American States Water; California Water Service Group; Southwest
Water; German major - RWE AG; UK based Kelda Plc; Danaher; ITT Industries; Pentair; Calgon Carbon; Pall Corp; Zenon; Millipore; Asahi Kasei; Nalco
Holdings; Watts Water; Walter Industries; PICO Holdings; Cadiz Inc; and PureCycle
According to Bill Burmeister, co-founder of Global Safe Water, the industry is likely to see further consolidation with big players mopping up smaller operators. Some notable transactions in the past include: GE acquiring Ionics Inc for $1.1b; Siemens acquiring US Filter division of Veolia for $993m; Pentair, Inc. acquiring WICOR, Division of Wisconsin Energy for $850m; and Blackstone Group & Goldman Sachs Capital Partners acquiring Ondeo Nalco, div of Suez S.A. for $4.2b.
The worldwide demand for water and water treatment is torrential. For instance, China plans to build 375 wastewater treatment facilities by 2009. The World Bank has estimated that in 2007 investments of between $400-$600 billion were made to meet the demand for fresh water.
Costs for treated wastewater in North America are usually between $1 and $39 per 1,000 gallons treated, while costs for USP purified water average $20-$60 per 1,000 gallons.
Industry
According to Stanford Washington Research Group, The global water market is widely estimated to be between $350-500 billion in annual revenues, with the U.S. market in the range of $95-150 billion. By any measure, the majority – about 60% of the total both in the U.S. and globally– comes from water and sewer utility revenues, most of which remain in the hands of local governments around the world.
The breakdown of the global industry is as follows: Municipal water & sewer revenues ($200-220 billion); Equipment & services ($75-80 billion); Contract services ($32- 40 billion); Transmission, delivery ($16-20 billion); and Chemicals ($13-20 billion).
The breakdown of the US market is as follows: Water and sewer utility revenues ($63 bil); Infrastructure construction ($19 bil); Treatment equipment ($8 bil); Treatment chemicals ($4 bil); Contract operations & maintenance ($4 bil); Consulting ($3 bil); Residential commercial POU/POE ($2 bil); and Analytical instrumentation ($1 bil).
Key Challenges
The outlook for growth in private sector participation in the municipal water and sewer markets that currently dominate the overall sector remains less clear. “Privatization” or “public-private partnership” in owning or managing water and sewer utilities remains highly controversial. Some environmental activists, along with many local government officials, remain vocally opposed to the private sector gaining a profit from bringing direct capital investment into the sector. However, private sector investment in government-controlled water systems, via taxes and tax-subsidized financing, or even charity, is fine.
The United Nations’ “Millenium Development Goals” state that 1.2 billion people already lack access to clean drinking water and 2.4 billion lack access to adequate sanitation, with these numbers continuing to rise. The UN set a goal in 2002 of reducing these numbers by half by 2015. However, Water is still largely taken for granted by consumers, governments, and even by industries that heavily depend on it. Corporations around the globe are at risk, since many industrial users – including agriculture, power, pharmaceuticals, food and beverage, microelectronics, and petrochemical – are dependent on a clean water supply to make their products.
According to the EPA in the US, 53,000 community water systems will need an estimated $277 billion over 20 years to upgrade their infrastructure in order to provide safe drinking water, with medium and large systems (those serving 50,000 people or more) comprising about 80% of the total. These include – transmission & distribution ($184b); treatment ($53b); storage ($25b); and source/supplies ($15b).
The second largest category of needs is treatment systems, which represent about $53 billion in total needs over 20 years and about $24 billion of current needs. This includes projects to install filtration, disinfection, corrosion control, and aeration, as well as associated chemical treatment, testing and automated monitoring and control devices.
According to the Census Bureau, In FY03, government entities collected about $63 billion in water and sewer revenues, but spent nearly $76 billion on their water supply and sewer systems.
Consolidation
Despite a flurry of M&A deals in 2004 and 2005, the industry is still heavily fragmented. The key industry players can be segmented into the following categories: · Water utilities, · Filtration and UV, · Diversified industrial companies with a water flavor, · Infrastructure services, and · Wholesale water rights.
Some of the key players are: French water companies, Suez and Veolia
Environnement; Siemens Water Technologies; GE Water and Process Technologies; Aqua America; American States Water; California Water Service Group; Southwest
Water; German major - RWE AG; UK based Kelda Plc; Danaher; ITT Industries; Pentair; Calgon Carbon; Pall Corp; Zenon; Millipore; Asahi Kasei; Nalco
Holdings; Watts Water; Walter Industries; PICO Holdings; Cadiz Inc; and PureCycle
According to Bill Burmeister, co-founder of Global Safe Water, the industry is likely to see further consolidation with big players mopping up smaller operators. Some notable transactions in the past include: GE acquiring Ionics Inc for $1.1b; Siemens acquiring US Filter division of Veolia for $993m; Pentair, Inc. acquiring WICOR, Division of Wisconsin Energy for $850m; and Blackstone Group & Goldman Sachs Capital Partners acquiring Ondeo Nalco, div of Suez S.A. for $4.2b.
No comments:
Post a Comment