Key trends shaping the water industry in 2023

Rick Holland, head of Grundfos Asia-Pacific water utility business and executive director Australia, shares insights into challenges that have plagued the water industry, and what the industry can do moving forward.

By Amira Yunos

Tackling the past

What are some key pressures of water utilities in the face of climate change? In particular, how have the Russia-Ukraine war and COVID-19 impacted the global water sector?

Rick Holland: There are two sides to water utilities — not enough water, and too much of it. Both have taken a heavy toll on countries in recent years.

Currently, extreme weather events such as flooding have been on the rise. In 2021 alone, Asia-Pacific has experienced relentless and unpredictable climate-related disasters, severely affecting more than 57 million people during the peak of the global pandemic. Nearly one million people were swamped by flooding in Thailand, more than half a million people affected by floods and typhoons in the Philippines, and over 125,000 people hit by floods in Myanmar.

On the other hand, water scarcity continues to pose a key issue globally, caused by increased water demand due to rapid urbanisation, economic development, and population growth. Global events such as the Russian-Ukraine war and COVID-19 has also further exacerbated the issue, casting a spotlight on the importance of energy and water.

Furthermore, the pandemic has led to limited resources rapidly depleting while highlighting how many communities lack crucial access to clean water and sanitation. Meanwhile, the Russia-Ukraine war has had a ripple effect on the global energy crisis as sanctions heaped new pressures on oil and gas supplies, calling for greater energy efficiency actions to fuel supply disruptions and record-high energy prices. Both outcomes have pointed to a greater need to strengthen global water security and energy efficiency in the face of such disruptions. Increased demand has also led to greater waste generation. As chemicals are being used in agriculture, industrial waste and untreated sewage flow into waterways, water quality is something to be closely monitored.

These are equally challenging water problems. As water touches every aspect of our lives, the impact of such problems is far-reaching, requiring urgent actions to be taken by governments, businesses, and citizens.

In Asia-Pacific, what are the challenges unique to the region that can be transformed into opportunities for businesses, consumers, and the environment?

Holland: Asia is currently the world’s most water-stressed continent. It has 47% of the global average of freshwater per person, but 65% of the world’s population. As more cities in Asia urbanise and populations increase, water demand is forecasted to increase by 55% by 2023, increasing stress on the region’s water resources.

As climate change intensifies the global water cycle, it is expected to worsen the situation. Reduced access to freshwater will have a ripple effect on all areas that rely on water, from food security, livelihoods, to industries.

With rapid urbanisation, the region is also facing challenges in terms of water and sanitation. As populations grow, wastewater levels are rising alongside, and with conditions of wastewater treatment and groundwater contamination varying from city to city, some are struggling to cope with these issues. Wastewater management also comes with other considerations, such as how it can be energy-intensive, and that it runs the risk of potentially disrupting residents and existing infrastructure if done without the right construction.

Against this backdrop of growing demand, Asia is also facing mounting pressure to be more sustainable as part of global efforts to slow down climate change. The region has accounted for more than half of global CO2 emissions since 2019.

Governments have been taking action to address these challenges. For example, South East Asian countries are stepping up with climate pledges and net-zero targets, with eight of the 10 nations setting targets to achieve net-zero carbon emissions by 2050 to meet the intergovernmental panel on climate change’s target of 1.5°C.

At the same time, companies are recognising the business case for operating sustainably. The addressable market size for green businesses in Asia is expected to reach between US$4-5tn by 2030. Far from being a burden, sustainability is a business opportunity, allowing companies to ensure their continuity and positioning and making them more efficient and profitable.

Wastewater reuse presents a significant opportunity. With freshwater being one of the most precious natural resources that is getting scarcer day by day, treating and reusing wastewater reduces water consumption and further saves water for the community. We need to not see used water as waste, but as a resource that can be looped back into production.

Industry predictions for 2023

How can water be sustainably harnessed to support the region’s growth in agriculture, municipals, or domestic use?

Holland: For us to truly harness water as sustainably as possible, we need to first consider the water-energy nexus. Water and energy are intrinsically linked, and the increased demand for one can significantly affect the security of the other. According to the UN, 15% of water withdrawal is used for energy production globally, and this is forecasted to increase by 20% by 2035.

Today, governments and companies are aware of the urgent need to generate power and use water in socially and environmentally responsible ways. For us to achieve the best outcome for our water and energy challenges, we need to design holistic long-term solutions and policies that build efficiency into integrated systems. We want to do more with less — obtain more value out of available resources.

Agriculture is the largest consumer of the world’s freshwater resources, and more than one-quarter of the energy used globally is expended on food production and supply

Agricultural irrigation is an energy-intensive operation — lifting and moving water around farms with pumping systems for irrigation consumes plenty of energy.

Worn or improperly sized pumps, worn nozzles, and improperly sized or designed fittings can cause irrigation systems to use up more energy than necessary. In response to this, Grundfos’ range of SP submersible pumps boast high-performance efficiency with its hydraulics and motor. The range is also built with AISI 304 stainless steel, making the pump resistant to corrosion, reducing overall lifecycle costs.

While reviewing how we can reduce consumption, it is also crucial to transition towards renewable sources of energy, such as solar. Solar-powered pumping systems present a cost effective, flexible, and secure water supply solution using clean energy. Utilising solar power reduces energy costs substantially and saves on the costs of energy infrastructure, wherever the application is installed.

Grundfos’ SQFlex pump system delivers reliable and economic water supply and comes with an easy-to-install plug-and-go solution with pump, controller, and support structure

Meanwhile, as household water consumption rises for water utilities and municipals, municipal water processes intensify overall, using more energy to move water. The acceleration of water supply also increases the risk of water loss through the process. The constant water pressure generated could also lead to greater wear and tear in parts in the water system, and subsequently greater waste of resource through water leakages.

Recognising that water demand is not constant 24/7 and water supply can be moderated accordingly to meet fluctuating needs, Grundfos developed Demand Driven Distribution, an intelligent water management pumping solution that automatically adjusts water flow through the use of remote sensors and reduces excessive pressure in the water pipes. This in turn limits water leakages and losses, minimising cost and energy.

Water can also be harnessed sustainably at a network level. Through Grundfos’ Wastewater Network Connect application, a cloud-based platform that allows water and wastewater utilities to connect their pumping solutions to Grundfos cloud, municipals can attain 10-25% energy optimisation in their water and wastewater network. By leveraging advanced analytics and algorithms to predict leaks, the application helps fix problems in the water network before they happen, preventing wastage of resources and energy.

Lastly, at a domestic level, citizens are now empowered to harness water sustainably, by adapting their consumption rate for the better through digitalisation and data, keeping an eye on their water usage and responding with ‘water-wise’ behaviour, such as employing smart water meters, rainfall shutoff devices, and low-flow showers. Solutions today allow homeowners to control their home water systems right from their smartphones, ensuring water on demand and even real-time monitoring.

What is the potential in decentralised water and wastewater networks for both the industry and its consumers?

Holland: Decentralised water and wastewater networks are increasingly recognised for its potential for both the water industry and the communities they serve. Conventional centralised systems require investment to develop, with larger networks requiring high operation and maintenance expenses. Large systems for water distribution and swage collection are also prone to higher water losses.

While centralised water and wastewater networks work best in cities and highly urbanised areas, we foresee decentralised water networks playing a bigger role to meet increasingly local needs and where there is a lack in infrastructure for centralised supplies.

Beyond tailoring to meet local needs and involving lower costs in installation, maintenance, and operation, decentralised water supplies can ensure greater water quality as filtration and treatment processes are done much closer to the point of access. Decentralised water networks also operate more sustainably. With a smaller footprint, leakage waste is reduced and systems are less energy-intensive. These networks also take up less space, meaning that communities can benefit in creating green spaces.

However, this move to diversify from centralised water and wastewater treatment systems is not entirely a new trend. Decentralised water networks will not completely replace centralised ones, but new innovation and novel alternatives will come to the fore, with some examples including off-grid water supply systems and home water reuse.

There are also hybrid water supply systems (a combination of centralised and decentralised technologies), which look to achieve the best of both worlds. However, increased interlink between drainage and supply will add more complexity into the system.

How can water circularity contribute to the industry’s move towards net-zero?

Holland: As mentioned, with water and energy intrinsically linked, it is not surprising that today’s water systems are major sources of global greenhouse gas (GHG) emissions. With that, the water sector is actually in a unique position to become of the fastest sectors to decarbonise, creating best practices and case studies for learning for others.

Demonstrating this, leading utilities and stakeholders from across the water sector are pledging to take action to reduce their emissions. More than 65 water and wastewater utilities around the world have already set net-zero, carbon, and climate neutrality targets.

As a global water solutions provider, Grundfos recognises our responsibility in driving change, which is why one of our goals is to save 50 billion m3 water by 2030 through the development and installation of water efficient and water reuse solutions. Grundfos is also the first organisation in the water solutions sector to receive full validation of its 2050 net-zero target from the Science-based targets initiative (SBTi).

We strive to optimise water solutions at every stage of the operational water cycle: water intake, water consumption, water treatment, water reuse and water replenishment.

A key concept that brings this to life is circularity, which is becoming an important part of ensuring sustainable water management. Going beyond resource efficiency, companies also need to look at embedding circular principles throughout their business. Circularity focuses on designing waste out of the resource ecosystem and maximising the value of resources by keeping them in use for as long as possible.

Currently, the global supply chain is still driven by the linear economy, where raw materials are processed, used, and then discarded as waste. However, a linear approach is not sustainable in the long run. If we continue on this path, by 2050, global demand for resources will almost triple to 130 billion tonnes annually, which would overuse the earth’s capacity by over four-fold.

Water reuse is a big part of circularity. By ensuring wastewater is treated to a quality that makes it possible to feed back into our water cycles, it allows water to be saved in a time of scarcity. Water treatment solutions are now capable of empowering companies to reuse their wastewater, reduce costs, and do their part to ensure that our natural water sources are not exploited.

In your opinion, what are some innovation objectives that can mitigate climate change? How do Grundfos’ processes and R&D embody these objectives?

Holland: Innovation and technology will play a bigger role in increasing the sector’s resilience and sustainability. Grundfos has been steadfast in its focus of delivering quality and intelligent water solutions, leveraging the strength of mobile connectivity to deliver optimal control and reliability, for everyone from industries, municipalities, to everyday people.

Grundfos is also focused on R&D. Globally, we devote 4-6% of our revenues to R&D. A key example is when we introduced iSolutions to the market — a range of products with a focus on connectivity, intelligent monitoring and advanced features to optimise water and energy efficiency across water systems. 

However, there are two key considerations that innovation needs to keep in mind, and where Grundfos aims to embody. Firstly, innovation cannot occur in silos, especially in today’s globalised environment. Success in tackling global challenges requires us to look at partnerships. Beyond driving research and development, seeking collaborations and partnerships can help advance and accelerate any innovator’s existing efforts.

Innovation is more than just technology: It is also about different agents of change coming together with their own unique strengths to bring about real impact. Thinking innovatively in terms of partnerships is crucial in achieving development impact while at the same time meeting the business needs of a rapidly changing world.

Secondly, new innovation needs to be made accessible to achieve mainstream. Some of the common barriers for adoption have been gaps in technical capacity, expertise, and resources. Innovative business models are key to financing water infrastructure and ultimately boosting water security.

In response to cost being a common barrier for customers to adapt sustainable technologies, Grundfos came up with Grundfos energy earnings, a payment service based on the as-a-service business model. It is a win-win business model designed to save energy without requiring an initial investment and allows customers to finance new pump solutions with a share of their energy earnings.