Water Technology Markets 2020
By Paul O'Callaghan 18 August, 2020
BlueTech CEO O'Callaghan gives you a sneak peak at the key findings from their upcoming report
In 2010, BlueTech Research CEO Paul O’Callaghan was the lead author on a report analysing the prospects of a wide range of innovative technologies across the water and wastewater treatment space; Water Technology Markets 2010: Key opportunities and emerging trends.
BlueTech Research has continued to track, monitor and analyse water technologies over the past 10 years. Our understanding of the technology landscape has evolved, along with our understanding of it, and we have synthesised the knowledge built up over the past decade to take stock of the changes and the rise and fall of various companies to form a view of the technology landscape in 2020, with a view to what may happen up till 2030. These insights will form part of a planned report to be published later in 2020.
Here, we provide a preview of some of our findings, as presented in our BlueTech Forum Connect event in June. The full presentation can be found on the Intelligence Platform.
The Gartner Hype Cycle: from 2010 to 2020
The above figure shows the positions of various technologies on the Gartner Hype Cycle in 2010 on the left, and their positions in 2020. In 2010 a number of technologies were at the early stages, sitting at the peak of inflated expectations. There was excitement about potential applications for ceramic membranes, forward osmosis (FO), and bioelectrochemical systems.
In some cases, the optimism may have outpaced the reality…
In some cases, the optimism may have outpaced the reality. A couple of other technologies, including AI and deep sea reverse osmosis, were on their way up the peak. As the years went by, the bubble burst for some of these technologies, and they started moving down the peak towards the Trough of Disillusionment, and interest began to wane in some cases.
It should be noted that within the model, this is normal and the classic pattern – a discovery is made, announcements, optimism and investment follow, leading onto a shake-out in which companies stall, pivot or refine their expectations of a technology and where it makes commercial sense.
…Bioelectrochemical treatment is one example…
…meanwhile, thermal hydrolysis has been a success
Bioelectrochemical treatment is one example; in 2010 it was significantly hyped, as were ceramic membranes and forward osmosis. Today, bioelectrochemical technologies have become an augmentation of anaerobic treatment, particularly in the case of offerings from Cambrian Innovations, and are being used in sensors – quite a departure from the original vision of generating electricity from wastewater.
Thermal Hydrolysis (TH), however has been a success story in the past decade. In 2010 it was referred to as just one of several “sludge pre-treatment” options which included ultrasonic treatment, high pressure homogenisation, electroporation and chemical treatments. 10 years on, TH is the winning technology. As long as the twin drivers of increasingly tight legislation and anaerobic digestion remain, then there will be significant growth potential.
In the 2010 report, only a single page was devoted to “water software” – this would be an unthinkable omission today and demonstrates how far AI technology has come.
AI tools are here to stay but we have not seen widespread integration
Nevertherless, in the case of AI, we have not seen widespread integration of AI tools into business operations as yet, and the failure of FATHOM may have signalled the beginning of the inevitable slide into the next stage – the Trough of Disillusionment. There is no question that AI tools are here to stay, but as with the development of the automobile, only a selection of approaches will win out.
Atmospheric water capture (AWC) is another technology which has advanced, but also has some abundantly clear pain points. A decade ago it was a fringe technology, and it has been something of a surprise how seriously it is now being taken, with one company, Zero Mass Water, attracting over USD100mn in investment so far. However, on closer inspection, as a technology it is often compared with conventional forms of water delivery such as desalination in terms of cost and efficiency. This is the wrong comparison, however; if AWC is compared to bottled water or point of use then it has its nice in certain areas, where despite the energy penalty, the security of supply may appeal.
Turning to FO, it seems that the worst may be over for it, with the technology beginning to climb the Slope of Enlightenment. A number of companes including Statkraft, Modern Water, Oasys and HTI left the field, while a number of newer companies came in found their niche. Notably, Aquafortus pivoted towards an ionic separation technology, abandoning the membrane component altogether.
FO has made a journey in terms of preceived application as a desalination technology, to being a niche tool for concentrate management in food and beverage applications, and zero liquid discharge.
Applying BlueTech’s Water Technology Adoption model
The progression of technologies across the decade through the Gartner Hype Cycle can be overlaid with BlueTech’s own Water Technology Adoption (WaTa) model. The stages of the model are:
- Applied Research
- Early Adopters
- Early & Late Majority
The following figure (click on charts to enlarge) shows the journey of various technologies described in the 2010 report through different stages over the past 10 years. Looking at how the decade played out, several technologies left the scene, some have stalled and others have moved, some further than others. Membrane aerated bioreactors (MABR) is notable for its progression, having been an almost unknown term 10 years ago to being commonplace today.
Progression of a technology through the model can be divided into three categories of examples, which are necessarily simplifications of the real world:
- Rising stars: These are examples of where the market is adopting a technology at an accelerating rate, sales are occuring, and companies are generating revenue. Examples include MABR, granulated sludge and thermal hydrolysis.
- Zombie technologies are by contrast not making progress and may have remained in the position they were 10 years ago. Super critical water oxidation (SCWO) for example, is at risk of “death by pilot”.
- Technology graveyard: This is a technology area in which the mortality rate of companies is high, and a large percentage of the companies offering this technology have failed. Sludge-to-energy is an example. A look back at 2010 shows that a number of companies were pursuing the conversion of sludge into solid fuel by various methods; carbonisation, torrefaction and pyrolysis. All of the companies offering these technologies are now out of business. They were all anticipating that sludge disposal costs would rise due to a decrease in land application and that energy costs would also rise, and neither of those trends have materialised sufficiently.
BlueTech Reseach has published a paper looking at why some technologies move faster than others. Part of the explanation is due to the type of innovation – whether it is crisis-driven, i.e. meeting an urgent regulatory-based need for example, or value-driven, for example being more energy-efficient.
On average, it is up to 14yrs for Value Driven innovations & 6.5yrs for Needs Driven innovations to move through the stages
Analysis of adoption rates for Needs Driven versus Value Driven innovation water technologies was published in Water Environment Research in 2019. While the average time for a water technology to move through the various stages of the WaTa model is 11-16 years, it is up to 14 years on average for Value Driven innovations, and 6.5 years on average for Needs Driven innovations.
Understanding the type of innovation being addressed could be extremely useful to a potential investor. The model could provide an additional level of understanding, enabling an investor to ensure the innovation being considered matches its anticipated timeline to exit.
Technology markets in 2030
Looking ahead to 2030, it is of course impossible to pick out which emerging technologies will definitely succeed. However, it is possible to look at overall trends, and BlueTech has picked 10 areas which we believe will do very well.
These include the sanitation economy, in particular the opportunity to provide sanitation technology and services to the estimated 2.5bn people that currently lack them, but have the ability to pay.
Looking to 2030, we have picked 10 areas that will do well…
…Stormwater management & quality monitoring, will continue to be growth areas due to climate change
Click on image to enlarge
Climate change is a trend the report covered in 2010 which has certainly not gone away, and as a result we believe stormwater management will continue to be a growth area, as will water quality monitoring, as concern over emerging contaminants and pathogens continues to grow.
Decentralised technologies are also expected to flourish, from solutions within the building such as grey water systems, to point of use.
The outlook for the next decade is extremely strong for water reuse
The outlook for the next decade is extremely strong for water reuse, both municipal and industrial. For similar reasons, brine concentrate management will also be a growth area. The more that water systems “close the loop” on water, the more important methods for dealing with the residue that is left will become.
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