Water and power generation are inseparable. Fossil fuel-fired power stations require a reliable, consistent stream of treated water to operate effectively. Wastewater streams generated from the combustion of coal need adequate treatment before being discharged.
Global Water Intelligence’s in a research report, Water for Power, says that water and wastewater treatment in the power industry is already big business, worth US$2.1 billion in 2013. The largest capital expenditure outlay is accounted for by pre-treatment systems (34%), followed by conventional wastewater treatment (26%) and condensate polishing systems (24%).
Capital expenditure is predicted to grow at an annual rate of 7.2% between now and 2018, driven by new additions to power generation capacity – largely in emerging markets – and the replacement of systems at existing generation facilities in mature markets. The total value of this market is expected to reach US$2.9 billion in 2018. The growth of the market is based on three principal drivers; rapid economic development and industrialisation in developing countries; the need to secure a reliable source of water to operate power generation facilities: the need to reduce the environmental impact of the power industry.
The supply of wastewater treatment equipment is the most rapidly growing area of the market, with a projected 10.2% compound annual growth rate between 2013 and 2018. This market is expected to be worth US$608 million in 2013, and the most well developed regions are in Europe and the United States, where stricter environmental regulations are limiting the concentrations of pollutants that can be discharged in wastewater streams. Power plants in water-scarce regions of India and China, meanwhile, will invest in wastewater treatment as a means of reusing effluent streams, chiefly for cooling system makeup water.
Most of the investment in wastewater treatment will go towards conventional treatment solutions, where capital expenditure is expected to be US$536 million in 2013. Innovation is the best way to gain a share of this market, and plant operators are particularly interested in chemical and biological processes to remove heavy metals, particularly selenium and mercury. High-recovery systems will remain a niche market within the power industry (US$72 million in 2013), and are only likely to come into their own where the risk of water scarcity interrupting power supplies outweighs the high unit cost of installation.
The market for boiler water treatment systems, including pre-treatment, demineralisation and condensate polishing, is expected to be worth US$1.4 billion in 2013. This reflects the importance of a reliable stream of high-purity water to the operation of a power plant. Investment in these technologies will be strongest in regions where the power sector is expanding, such as south east Asia and sub-Saharan Africa. Capital expenditure in mature markets will grow more slowly, and is more dependent on the upgrading and replacement of existing systems. Sluggish growth in these markets means that demand for process water treatment technologies will grow more slowly than the overall market between 2013 and 2018, at 5.5%.
The water for power market can be divided into two. In mature markets, most expenditure will go towards the replacement, maintenance and upgrade of existing systems. Investments in wastewater treatment will grow fastest, as plant owners come under pressure to bring ageing power plants in line with new environmental regulations. In developing markets, most expenditure will be on newly built plants. Investments will be focused on securing a reliable source of feedwater.
As the most under-developed region historically in terms of power generation capacity, sub-Saharan Africa has the most growth potential in the power sector, and Global Water Intelligence anticipates that investments in water treatment technologies to support that growth will grow by 15.4%, up from US$29.3 million in 2013.