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Addressing Water Utility Inefficiencies Through Addressing Water Utility Inefficiencies Through Smart Water Grids Smart Water Grids Insights from 360˚ Perspective on Global Smart Water Grids Market Insights from 360˚ Perspective on Global Smart Water Grids Market Seth Cutler, Research Analyst Seth Cutler, Research Analyst November 2, 2011 November 2, 2011

Addressing Water Utility Inefficiencies Through Smart Water Grids

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Page 1: Addressing Water Utility Inefficiencies Through Smart Water Grids

Addressing Water Utility Inefficiencies Through Addressing Water Utility Inefficiencies Through Smart Water GridsSmart Water Grids

Insights from 360˚ Perspective on Global Smart Water Grids MarketInsights from 360˚ Perspective on Global Smart Water Grids Market

Seth Cutler, Research AnalystSeth Cutler, Research Analyst

November 2, 2011November 2, 2011

Page 2: Addressing Water Utility Inefficiencies Through Smart Water Grids

Today’s Presenter: Seth Cutler

Functional Expertise

� One year of Environment & Building Technologies research expertise, including the growing smart technology sector. Particular expertise in:

- Qualitative and Quantitative Market Research

- Industry Analysis and Forecast

- Geographical Information Systems (GIS)

Industry Expertise

� Experience base covering broad range of sectors, leveraging long-standing working relationships with leading industry participants’ Senior Executives

- Smart Water Meters

- Smart Water Grids

- Economic Development

- Regeneration- Regeneration

What I bring to the Team

� Research and Consultancy Background

� Stakeholder Engagement

� Strong Analytical Experience

� Deadline and Priority Focus

Career Highlights

� Extensive expertise in economic regeneration.

� Productive careers in several leading research and consultancy firms:

- Regeneris Consulting Ltd, London (UK)

- London East Research Institute, London (UK)

Education

� MA (Hons.) Geography from the University of St Andrews, St Andrews, Scotland

� MA Cities, Culture & Social Change from King’s College London, London, England

Seth CutlerResearch Analyst

Frost & SullivanEuropeLondon

Page 3: Addressing Water Utility Inefficiencies Through Smart Water Grids

Focus Points

� Introduction to Mega Trend on Smart Cities and Smart Water Grids

� Why and how are we Seeing Growth in This Market

� Short History on Market Development and Initial Case Studies

� Identifying the Smart Water Macrocosm� Identifying the Smart Water Macrocosm

� Forecast & Trends

– Regional Attractiveness

– Vertical Market Attractiveness

� Future Trends and Extensions of the Smart Water Grid Market

� Strategic Directions of the Market

Page 4: Addressing Water Utility Inefficiencies Through Smart Water Grids

SMART Infrastructure: Multimodal Transport Hubs Providing Excellent Air, Rail, Road Connectivity to Other Mega Cities

SMART Technology: Intelligent communication

SMART GRID & NETWORK: Infrastructure

SMART Water & Energy: 20 percent of energy in cities and a

decarbonization of water infrastructure.

SMART Buildings: At least 50 percent of buildings will be Green and will be Intelligent built with BIPV. Around 20 percent of the buildings will be Net Zero Buildings.

Urban Regions are Leading Smart Urban Planning InitiativesSnapshot of a SMART Mega City Plan in 2020

44

communication systems connecting home, office, iPhone and car on a single wireless IT platform

Satellite Towns: Main city centre will merge with several satellite towns to form ONE BIG MEGA CITY

SMART Cars: At least 10 percent of cars will be electric vehicles. Free fast charging stations at every half mile

Infrastructure to enable real

time monitoring of

energies to optimise

efficiency and inform

decisions

Source: Google Images

Page 5: Addressing Water Utility Inefficiencies Through Smart Water Grids

Emerging Mega Cities Will Have World Class Infrastructure and Develop Sub Satellite Towns (e.g. Chennai)

2020 + Interconnectivity withSub Satellite Towns

2015 – World Class Infrastructure (Equals Tier 2 city)

Core City

2000 – Satellite Towns Developing

5

Satellite Towns

Outsourcing companies (non IT), like research

healthcare, auto manufacturing will increase number of satellite

towns

Development of infrastructure to connect Satellite and Sub

Satellite towns to utilitiesCommercial hubs

Global Mega Trend Relevance to Smart Water Grids

As urban regions become more complex, greater logistical and operational demands will be placed on water utilities in terms of supply, distribution and waste.

A key characteristic of all Mega Trends is the use of ICT technologies to enable smarter management processes to handle and process the amplified demands.

Page 6: Addressing Water Utility Inefficiencies Through Smart Water Grids

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

June 2011 Forecast Real GDP Growth (USD 2005)

Sub-Saharan AfricaOECD Countries

Euro Area

Japan

United States

Current Economic Climate is Unlikely to Deliver Large Public Investment in Water Utilities, Where Funding is Already Stretched Thin

180

75

3.6$0

$20$40$60$80

$100$120$140$160$180$200

Needed for Water Security

Investments in Water Resources

World Bank Investments

Annual Investments in Water Resources (US$B)

-8.0

2009 2010 2011 2012 2013

6

Note: Based on Developing Countries, Source: World BankSource: World Bank

6051

40 39 36 31 26 2620 19

137 5

010203040506070 Non-Revenue Water Levels, Global

Non-Revenue Water (%)

Page 7: Addressing Water Utility Inefficiencies Through Smart Water Grids

Sensors are Being Placed Holistically in the Water Cycle to Optimise Water Utility Operations and Management

Smart Water Grid Market

Segmentation Map

Design and Engineering

Services

Smart Water

Infrastructure

ICT, Software and

AnalyticsAutomation and Control

7

Adapted from: UK Drinking Water Inspectorate

Page 8: Addressing Water Utility Inefficiencies Through Smart Water Grids

Traditional Manual Water Grid

1970s Automatic Meter Reading

2010s : Smart Water Grid

Water Utilities are increasingly using data collection systems for real-time monitoring and control of the water cycle

Data Analysis

& Exchange

Data Analysis

& Exchange

Sourc

e: blo

g.a

irdye

.com

Time consuming, costly,

infrequent and prone to human

error

Data is transmitted wirelessly. Handheld receivers and drive-

8

2010s AMI Smart Water Grid

Source: signsworldwide.com

receivers and drive-by networks first but moving increasingly

towards fixed networks

Current technology allows two-way communications

between the utility, customers and

infrastructure to maximise efficiency and savings

Source: roadtrafficsigns.com

• Using information to integrate traditionally

departmentalised water utilities

• Network of real time sensors to offer depth of analysis previously unattainable

• Maximizing operations and control to reduce carbon footprints and improve efficiencies to realize tangible financial benefits.

Revolutionizing the Water Industry

Page 9: Addressing Water Utility Inefficiencies Through Smart Water Grids

Immediate Applications

“Heat” Index: Smart Water Grid Objectives to Change Over Time as Grid Becomes More Secure

Water utilities will look to tackle initial problems concerning non revenue water, leakage and quality.

Strong relationship with the deployment of sensors and hardware.

9

Strategic Applications

Smart water grids by design identify immediate problems to allow utilities to focus on strategic challenges and gain foresight into emerging issues.

Largely a post-deployment phase where emphasis is on data manipulation and advanced software.

Width and darker shading indicates level of investment as a utility deploys and operates a smart water grid.

Deployment and operation of a smart water grid

Page 10: Addressing Water Utility Inefficiencies Through Smart Water Grids

• $32 million in direct savings over the hardware life

• $44M savings through Customer Service and Conservation benefits

• Overall investment in 385,000 AMR water meters.

Las Vegas Valley Water District

Case Studies

Derceto optimised Gwinnett County’s Distribution System Energy Management to realise an annual savings of approximately $500,000.

Where could savings be made?

Derceto and Gwinnett County

Metering

Grid

Source lasvegastvshow.net

Source: derceto.com

10

• 8,000 Fluid Conservation System PermaLog remote leak detectors

• Saved 2.6 billion litres of water by 2006, 2 years into operation.

• At a cost of $2.1 million in 2003, the District saw a ROI in two years and a savings of $1.2 million in the following three years. By 2007, 1,070 leaks had been repaired.

Where could savings be made?

• Load Shifting – move operations overnight while energy prices are cheapest.• Source Shifting – determine and use the cheapest water treatment facilities.• Efficiency Savings – identify and use the most efficient pumps.

Actual Savings:

• Load Shifting – $376,000• Source/Efficiency Shifting - $130,000

• Total Savings - $506,000 per annum

Grid

Source: halmapr.com

Page 11: Addressing Water Utility Inefficiencies Through Smart Water Grids

Water Resources & Supply

Smart Water Macrocosm

(Data

Exc

hange a

nd A

naly

sis

)

•Smart Technology application to every part of the water industry.

•Currently many water utilities are focusing on just one microcosm, but in future smart technology will be applied more holistically.

The Smart Water Macrocosm Split into Microcosms

11

Water Distribution

Wastewater Treatment, Discharge

and Recycling

(Data

Exc

hange a

nd A

naly

sis

)

•Much of the initial investment is flowing into Water Distribution and to a lesser extent Water Resources and Supply.

•As a result, this report focuses on the Water Distribution microcosm, but future research will expand into the related segments identified here.

Page 12: Addressing Water Utility Inefficiencies Through Smart Water Grids

The Global Smart Water Grid Market is Forecast to see Strong Growth, Especially from 2016 Onwards

70%

80%

90%

100%

Smart and Conventional Water Grid

Penetration, Global, 2010-2020

14.4% CAGR 2010-2020

12

0%

10%

20%

30%

40%

50%

60%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Conventional Water Network Smart Water Network

$5.8BTotal Market

Value

$22.2BTotal Market

Value

$8.7BTotal Market

Value29%

Page 13: Addressing Water Utility Inefficiencies Through Smart Water Grids

ICT, Analytical Software is Outpacing Other Vertical Markets and APAC Will be Catching up to Developed Markets

2010-2

020 (

%)

ICT, Analytical Software

Engineering

Smart Infrastructure

Smart Water Grid Vertical Market Attractiveness, Global 2010

2010-2

020 (

%)

Smart Water Grid RegionalAttractiveness, Global 2010

North America

APAC

MEA

LatAm

13

Seg

men

t G

row

th R

ate

, 2010

Market Share (%)

Engineering and Design

Control and Automation

Infrastructure

Seg

men

t G

row

th R

ate

, 2010

Market Share (%)

Europe

Page 14: Addressing Water Utility Inefficiencies Through Smart Water Grids

Industrial Convergence to Play a Key Role in Market Development

Integrated SmartControl andAutomation

Smart Pumps,Pipes and

Engineeringand Design

Smart Water Meter

Manufacturers

14

Water SolutionsAutomation

ICT, Analytical Software

Telemetry andCommunications

Remote PowerGeneration

Pipes and Valves

Page 15: Addressing Water Utility Inefficiencies Through Smart Water Grids

Driver of Convergence is Microcosm Unification to Increase Effectiveness of Data, which will Demand Holistic Software

Water Resources & Supply

Smart Water Macrocosm

(Data

Exc

hange a

nd A

naly

sis

)

Smart Water Utility Software System Package

Hydraulic Modelling / Network

Infrastructure

15

Water Distribution

Wastewater Treatment, Discharge

and Recycling

(Data

Exc

hange a

nd A

naly

sis

)

Infrastructure Monitoring

Energy Consumption

by Use

On Demand Historic Data

GIS

SCADACustomer Service

Water Quality

Metering (AMR, AMI)

Page 16: Addressing Water Utility Inefficiencies Through Smart Water Grids

Industrial Convergence Will Also Encourage Smart Water Consumers

Sourc

e: jb

oss.o

rg

Sourc

e: tm

cnet.com

Sourc

e: fu

lly-inte

gra

ted-

dis

hw

ashers

.com

Sourc

e: energ

ysavi

ngtr

ust.org

.uk

Smart Water and Energy AppliancesIncreased Granularity of Information to Drive Consumer Engagement

16

In-home interface or display

Enhanced billing with intelligent neighborhood comparison

Web portal

Sourc

e: parlia

ment.uk

Sourc

e: giz

mag.c

om

Sourc

e: 4.b

p.b

logspot.com

Sourc

e: fu

llydis

hw

ashers

.com

Sourc

e: energ

ysavi

ngtr

ust.org

.uk

Page 17: Addressing Water Utility Inefficiencies Through Smart Water Grids

Global Smart Water Solutions an Integral Element of Economic Rescue Package

2Essential element of economic rescue package

1Tangible benefits and operational efficiencies

17

3Industrial convergence creates a fast-paced market

4Balance of activity shifting to developing regions

5Less defined standards create opportunity to shape market

Source: Frost & Sullivan analysis.

Page 18: Addressing Water Utility Inefficiencies Through Smart Water Grids

Analysis

Relevant Trends Unmet Needs

Industrial convergence

Product and service prices lowering moderately

Advanced software and hardware growing presence

Developing business case

Return on investment model

Deployment model

As the Smart Water Grid Market Matures, Practical Concerns on Deployment and Technologies will be Addressed

18

Strategic Recommendations

hardware growing presence

Increasing M&A and strategic partnerships

Developing regions to see faster growth

Turnkey solutions

Government leadership

Water utilities, market participants and Government regulators need to work together to introducestandards within the market. This will be done through market consolidation, strong water utilitycommunication and Governments prioritizing the link between smart water grids and smart energy grids.

Page 19: Addressing Water Utility Inefficiencies Through Smart Water Grids

Next Steps

� Request a proposal for Growth Partnership Services or Growth Consulting Services to support you and your team to accelerate the growth of your company. ([email protected])

� Join us at our annual Growth, Innovation, and Leadership 2012: A Frost & Sullivan Global Congress on Corporate Growthoccurring 9 – 10 May, 2012 (www.gil-global.com)

19

� Register for Frost & Sullivan’s Growth Opportunity Newsletter and keep abreast of innovative growth opportunities (www.frost.com/news)

Page 20: Addressing Water Utility Inefficiencies Through Smart Water Grids

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