Survey predicts strong growth for U.S. water market

NEW YORK—America’s water and wastewater sector appears set to decline in 2009 as capital expenditure on crucial infrastructure projects is cut back by 12.9 percent, according to Water Market USA, a report recently published by Global Water Intelligence. But in the longer term, much stronger growth is in store, as scarcity and the need for environmental protection and repair of decaying networks force the pace of investment. Restraints on borrowing, shrinking tax bases, and a drop in capital contributions from property developers have derailed investment plans, the report suggests. However, capital expenditure is expected to grow from $25.2 billion in 2009 to $49.7 billion in 2016.

Water Market USA is an independent assessment of the U.S. municipal water market based on a survey of the spending plans of 1,000 major water and sewer utilities. It includes detailed market forecasts for pipeline and treatment technologies, as well as a list of current project opportunities.

According to the report, the biggest area of expenditure will be rehabilitating the sewer network, attracting total expenditures of $46 billion between 2009 and 2016. Up-grading wastewater treatment plants is also a priority, attracting $41.1 billion during the same period. The fastest-growing market will be seawater desalination, attracting total capital expenditure of around $130 million in 2008. This will grow to more than $1 billion by 2015.
Other findings from Water Market USA include the following:

• Water rates will need to rise steeply. Currently, U.S. consumers pay between a third and a half the amount that European consumers pay for water, but they use two to three times the amount of water.
• The challenge of recruiting skilled staff will drive investment in automation among larger utilities, as well as encourage outsourcing among smaller utilities.
• The fastest-growing water technology markets between 2008 and 2016 will be ultrafiltration and microfiltration membranes (up 280 percent), UV disinfection (up 227 percent), ozone disinfection systems (up 233 percent), membrane bioreactors (up 180 percent), and reverse osmosis membrane systems (up 165 percent).
• Capital expenditure on water reuse will top $10 billion between 2009 and 2016; whereas seawater desalination will attract investment of $5.5 billion during the same period.

More information on Water Market USA is available online at www.globalwaterintel.com/GWM2008/usa/index.html.