- Water quality and scarcity problems (‘water stress’) are reaching critical proportions worldwide, increasing governmental regulatory responses (mandates, not price support)
- Different developmental stages drive varying investment priorities & projects globally; technological approaches are currently only a small part of the solution and even smaller part of CapEx (vs. infrastructure, services etc.)
- Technology (‘WaterTech’) promises to transform the huge (~US$450bn annual investment) water sector, but faces significant legacy challenges (infrastructure, regulation, incumbents, conservatism) and entails scale-up risk (costs, timeframes)
- While the Agricultural sector dominates water consumption (& waste), followed by Utilities, the Industrial sector is a quicker adopter of new technologies
- An increasing interdependence is emerging between the water & energy sectors (‘water-energy nexus’)
- Europe’s Circular Economy Action Plan and an energy efficiency push (as part of its Green Deal), will drive initiatives and opportunities in the Water sector
- Innovation and investment opportunities exist in most major segments – water treatment (WT), wastewater treatment (WWT), conveyance systems, leakage avoidance/remediation – as well as new segments (“smart” water, waste-to-energy …), but a proliferation of different technologies / approaches, for a highly fragmented and insular customer base, stifles business scaling
- Despite an early VC enthusiasm for WaterTech, this has waned as the associated long project/customer leadtimes and high CapEx (pilot projects) have become apparent
- The high fragmentation of water SMEs presents significant potential for consolidation and bolt-ons for large industrial groups
Subsectors
Water Technology
