Natural resources, agriculture and manufacturing. Many of North America’s strongest industries are also its most water intensive. Increased awareness around risks – water scarcity, for example – brings fear into the heart of many a manufacturer. But where they see failure, David Henderson sees opportunity.
“We get a dual benefit by investing in water innovation,” says the managing director of water investment firm XPV Capital. “It will increase the productivity of our key sectors and, at the same time, create a whole new generation of companies that can export their water solutions around the world.”
Laura Shenkar of the San Francisco-based Artemis Project agrees. She says that water technologies represent the next wave (no pun intended) of high-growth tech investments.
The Artemis Top 50 Water Tech Listing began as an initiative to prove to the investment community that there is a critical mass of water companies worthy of venture capital investments, Shenkar explains. The sector is bolstered by reports that project these disruptive technologies and business models will yield profits as revenues in the water industry approach US$1 trillion by 2020.
Shenkar and Henderson believe that many successful next-generation technologies exist to refine traditional systems and solutions. The real game-changers are often relatively simple ideas that make tweaks for added efficiency – adding a sensor to collect data here, developing a less energy-intensive filtration membrane there. Here are examples of how new tech is tackling some of the world’s biggest water challenges with just a few small adjustments.
At its most basic level of human use, water needs to be drinkable. Much of North America’s large supply of freshwater is teeming with biological and chemical contaminants from a wide range of sources, such as urban and agricultural runoff, industrial effluent, and human and animal waste. To get water to a potable point, we need to identify potentially harmful ingredients. But traditional testing methods are slow and sometimes fussy. Before we can determine what to remove from a water supply, samples must go through incubation periods and specific temperatures.
Researchers like University of Waterloo’s Janusz Pawliszyn recognize the need for faster, more accurate samples. His team developed the solid-phase microextraction (SPME) technology, which skips a lengthy phase of sample preparation and allows field researchers to monitor and analyze samples on site. Working with Canadian environmental laboratory Maxxam Analytics, Pawliszyn’s team is striving to make the process more cost-effective, which could open the technology to developing countries with large populations that suffer from waterborne disease.
Public health risk, however, doesn’t stop at the treatment plant. In North America, aging or poorly maintained drinking water systems lose millions of gallons of treated water every year. Not only are the systems leaking – some estimates say that Montreal loses up to 40 per cent of its drinking water en route to taps – they’re opening the door to contamination and infrastructure catastrophes.
Limited municipal budgets are just one reason we’re having more frequent sinkholes. In many cases, the real problem is that cities don’t have a clue where and when they’re leaking. The problem is data deficiency, and the solution is better intelligence.
Automation and data-gathering technologies are the way forward, says Dave Woollums of Mueller Co. The company’s recent acquisitions – such as Ontario’s Echologics, which uses acoustic technology to detect leaks and assess the condition of water pipes without breaking ground – focus on these areas.
“We’re working on embedding intelligence into devices that have, in the past, been dumb mechanical products,” says Woollums, Mueller’s vice-president of research, development and engineering. “By placing pressure sensors in strategic valves in a system, for instance, we can reduce energy consumption and leakage, and extend the time before utilities have to repair leaks in pipelines.”
Combined with sensors, robust GIS systems can help municipalities capture and predict the state of their water infrastructure assets, layering collected data with adjacent infrastructure, environmentally sensitive areas, and other datasets that can help them make better decisions.
“GIS is like a crystal ball, but better,” says Karen Stewart, ESRI Canada’s public works industry manager. “Every time you track conditions, you can finetune your analysis and more accurately extrapolate future performance.” The more you measure the system, the better you can manage it.
It’s a good thing we’re fixing those pipes, because the planet is about to get thirstier. Research from McKinsey & Company projects that, with population growth, water demand will outstrip supply by 40 per cent by 2030. Throw climate change – especially extended periods of regional drought – into the mix and you’ve got a significant challenge.
Over the past few decades, water-scarce regions have turned to the sea for a viable alternative to surface and groundwater supplies. According to its Ministry of Environmental Protection, Israel’s mammoth desalination operations are projected to create some 600 million cubic metres per year by 2013 – a quantity equal to about half the freshwater that is pumped in the country on average each year – making desalination its main source. While relieving the demand for freshwater, however, the early days of desalination proved it can be an energy-intensive, and therefore costly, process.
Today, water-tech entrepreneurs will tell you otherwise. California’s NanoH2O, which earlier this year secured financing from BASF, Total Energy and Keytone Ventures, has developed a more economical, more energy-efficient reverse osmosis membrane. Vancouver’s Saltworks Technologies harnesses low-temperature heat from solar energy and waste heat from power generation to reduce the amount of mechanical or electrical energy required for the process.
These technologies work for drinking water, but they can have several other useful applications. NanoH2O’s membrane, for instance, could also help water-using industries preserve equipment from salt corrosion, which results from using saline groundwater, rather than depleting surface-water supplies. Multiple applications give these technologies their staying power, says Shenkar. “Companies are identifying niche areas where they can provide dramatic benefit, and finding success.”
Not surprisingly, oil and gas is proving to be a popular “niche” sector. Increasingly expensive and limited water supplies that steam-assisted gravity drainage (SAGD) operations in Canada’s oil sands demand, for instance, are attracting and driving innovation. Developers have the funds to take risks that municipalities can’t afford, and Shenkar says that makes this sector one of the major areas of opportunity.
If you need to ensure a stable water supply, why not reuse what you’ve already got? Texas-based 212 Resources looked at the costs of handling water, from sourcing to disposal, in the hydraulic fracturing process that helps extract natural gas from shale. The company’s process treats “frac” water – often high in salt and other contaminants – to take it to a level high enough for safe discharge back into natural waterscapes, which also makes it possible to reuse the water for subsequent hydraulic fracturing of shale rock.
Reuse possibilities extend to wastewater byproducts. 212’s process also separates concentrated brine from frac fluid, which has applications in other on-site drilling activities. New Sky Energy in Colorado converts salt and carbon dioxide from wastewater into valuable chemicals using a proprietary electrochemical-chemical cycle. Vancouver’s Ostara Nutrient Recovery Technologies designs, builds and sells water treatment systems that recover nutrients from wastewater, which it then uses to make an eco-friendly fertilizer.
These technologies in particular are indicators of a growing trend – and for good reason. They’re creating new revenue streams that can encourage even the risk-averse, cash-strapped municipal sector to more seriously consider innovative options for water management.
Technology that tweaks existing systems, makes processes more efficient, and generates revenue? If the investment community is right about emerging water tech, it’s going to be a profitable run to 2020.