China’s Membrane Rush: Foreign vs. Local

By Tom Freyberg 9 July, 2014

Tom Freyberg, Chief Editor at WWi, looks at foreign & local membrane technology companies in China

12 FYP: desalination capacity to increase to 2.2–2.6 mn cum/day by 2015 from <1 mn in 2013; big growth area
State Council goal: 70% of equipment at desal plants to be local; potential limitations for foreign brands
Chinese membrane tech is improving so likely to dominate market but still lucrative for foreingers given China's size

Membrane technology featured considerably at Aquatech China 2014 with its own designated area and over 40 exhibitors. The majority were Chinese though there were some foreign brands. The membrane technology on show was for both industrial and municipal use and filtered various pollutants from heavy metals to basic potable water pollutants. There were also membranes for desalination. For more on Aquatech China 2014 see here.

Given China’s increasing water standards and decision to increase its water capacity, membrane technology is likely to see rapid growth. The question is will this be dominated by Chinese brands or will foreign brands make a play? Tom Freyberg, Chief Editor at PennWell International Ltd writes about this below. This article first appeared in the Water and Wastewater International (WWi) publication, see here

Membrane-analysis-module (300 pixels)Ahead of the IDA World Congress in Tianjin, there was an air of excitement about the desalination market’s future growth in China.

After all, in February 2012, China’s State Council announced its 12th Five-Year Plan (FYP) for desalination. In this, it established a higher than expected target of 2.2 – 2.6 million m3/day of online capacity by 2015. This compares to less than 1 million m3/day today.

And such excitement continued through the week, with multiple suppliers and OEMs holding back key news until the event in China.

California’s Nano H20 kicked things off by announcing a $45 million investment into a manufacturing facility in Liyang, China – a city in the Yangtze River Delta, 250 km west of Shanghai.

State Council has a goal stipulating that 70% of equipment in a desalination plant should come from China

Yet caution continued to remain over what could be a game-changing footnote in the FYP. Despite the high target set by the State Council, a goal stipulating that 70% of all equipment used in desalination plants should be produced in the country is perhaps more relevant to global suppliers. Potentially all equipment such as membranes and pumps in a Chinese desalination plant will come from China.


Writing in WWi magazine, Khoo Teng Chye, former CEO of Singapore utility PUB, believes such a move does not come as a surprise.

He said it’s a policy “similar to that used to build up the country’s wind energy industry a few years ago. In fact, besides the similarity to the wind energy industry, the aim of the government’s plan for the Chinese desalination seems similar to what was achieved in the areas of rail and aviation.”

California’s Nano H2O put its peg in Chinese soil with a $45 million investment in a local manufacturing facility

Surprise or no surprise, the message is clear: China wants its water produced by Chinese equipment. By putting its peg in Chinese soil and establishing a local manufacturing presence, Nano H20 has clearly responded to this strict demand.

Other membrane companies remain guarded on China’s potential.

Brett Andrews, president and CEO of Hydranautics, told WWi: “I think business in China will get more and more competitive. There are many Chinese manufacturers coming onto the scene – some of them are going international. There are literally hundreds in China.”

“The Chinese latest Five Year Plan calls for an increase in local membrane technology…[this may mean] shutting out the market in the future for international players. This is a big danger for us.”

Brett Andres, president & CEO of Hydranautics

“The Chinese latest Five Year Plan calls for an increase in local membrane technology. So this points to local competitors and maybe even shutting out the market in the future for international players. This is a big danger for us.”

Speaking to WWi magazine, Dr Graeme Pearce, membrane expert said: “Only one or two [Chinese membrane manufacturers] have got into exporting their products. But the largest membrane makers of China are quite substantial given the large size of the Chinese market….I think the system integrators should be pleased as it creates another supplier for them.”

“Western suppliers will find that the technology at these companies is becoming on a par with the best technology from the west – that day is fast approaching and has probably dawned.”

“the remaining 30% market share for non-domestic desalination equipment is still a lucrative amount given the predicted size of the Chinese market”

On the positive side, the remaining 30% market share for non-domestic desalination equipment is still a lucrative amount given the predicted size of the Chinese market.

IP challenges and competition to one side, the original intrigue and skepticism of the Chinese desalination market remain. And with China’s South-North Water Diversion Project under construction utill potentially 2052; clean, potable supplies provided by desalination could be a faster solution to China’s water woes.

Further Reading

  • 5 Takeaways from Aquatech China 2014 – How real is China’s war on pollution? Will it translate into a growing domestic water market? See what local & foreign industrial leaders have to say in Shanghai and check out our 5 key takeaways from Aquatech China 2014
  • 8 Facts on China’s Wastewater – Don’t know anything about wastewater in China? Is it on the rise? Is industrial wastewater under-reported? Is it worse for rural areas? Check out our 8 facts from tech, key pollutants to standards
  • 2013-2014 Key Water Policies Review – Haven’t been following China’s Three Red Lines strategy to protect water? Given the war on pollution, check out our summary of key water policies from 2013 to 2014
  • Enforcing China’s Planned Green Economy – Can China achieve its planned RMB4.5trn energy-saving & environmental protection industry? HSBC’s Wai-Shin Chan on incentives, changes in environmental law, more regulatory muscle and what this means for water

Other Background on Desalination

  • Chinese Desal Policies Reviewed – Dr Guo You Zhi, Secretary-General of China’s Desalination Association shares with us his insights on why desalination targets have not been met and what’s in store for the future
  • Desalination: A Technology Driven Market – Amnon Levy, COO of IDE Technologies on the shape of desalination market and the technology challenges ahead. Is this the only way out of China’s water scarcity problem?
  • Desal in China: Trends & Opportunities – With targets for desalination remaining aggressive in the 12th FYP, China Water Risk reviews China’s desalination market – its past & future as desalination is expected to become more profitable given rising water tariffs

Chinese Government Report

Tom Freyberg
Author: Tom Freyberg
Tom Freyberg is an experienced environmental journalist, having worked across a variety of business to business titles. He has had articles and comments published in national newspapers, including The Times, The Guardian and CNN and has been invited to speak at several international conferences, including the World Conference of Science Journalists in Helsinki, Finland. An English graduate from Exeter University, Tom completed his PMA journalism training in London. He joined Pennwell in January 2010 as chief editor of Water & Wastewater International (WWi).
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