2018 to 2027 CAPEX savings by country. Image credit: Bluefield Research
A new report Bluefield Research has released shows that smarter and more advanced asset strategies could drive as much as US$41.9 billion in savings for water utilities by 2027. These savings come from both the advent of new technologically advanced solutions as well as companies adapting business models to better serve the water sector.
Utilities are dependent on asset management solutions in order to maximise asset service life as well as prioritise capital investment in critical infrastructure. And according to Bluefield, this trend is coming quickly to the forefront, buoyed by aging infrastructure, an aging workforce, and climate change.
“By integrating advanced asset management solutions across their business, water utilities can save upwards of 20 per cent on annual capital requirements while improving operational efficiencies,” Will Maize, Research Director of Bluefield, said. “In its essence, asset management is the core function of utilities in ensuring a sustainable, safe water supply.”
Utilities in 31 countries from the United States (U.S.), Canada, Australia, and Europe presently manage an estimated US$2.9 trillion in water, wastewater, and stormwater assets, all of which offer critical infrastructure services to over 822 million people around the world. Bluefield Research’s predictions have shown that advanced asset management solutions will save these utilities US$1.2 billion in yearly CAPEX savings this year in 2018, which will scale up to US$7.3 billion in annual savings by 2027, a decades’ time.
Data and analytics
Found at the core of this paradigm shift to advanced asset management solutions is the rising value found in analytics, data collection, and visualisation of network conditions and operations even as water utilities continue to search for ways to extend the service life of aging infrastructure and placing more importance on predictive decisions based on data rather than simply reacting.
“Municipal water utilities often include dozens of departments managing disconnected data silos to make complex operational and strategic decisions,” Maize continued. “In today’s rapidly changing information landscape, truly transformational companies enable a bridge between these silos, bringing together engineering and finance departments and unlocking the hidden value in relational insights.”
Technological advances and breakthroughs in machine learning and computational systems are disrupting and completely changing original asset planning processes and allowing utilities to more efficiently allocate capital.
“While the concept of asset management has been around forever, now, more advanced solutions are impacting how utilities plan, design, operate and maintain critical infrastructure,” Maize concluded. “Looking ahead, as assets age and data capabilities improve, we expect this critical function to grow in importance for the water sector.
Source: Bluefield Research