Climate uncertainty will top the list of sectoral concerns in the coming year
In 2024, the water sector will be forced to confront multiple challenges. Climate shocks, energy costs, emerging contaminants, and retiring workforces are just a few. Progress toward the United Nations’ Sustainable Development Goal 6 — ensuring availability and sustainable management of water and sanitation for all — is behind schedule, and the need to modernize water infrastructure in the United States is even more pressing than it was last year. What is the water and wastewater outlook in 2024?
Climate Uncertainty
Much of the buzz in the water sector for 2024 centers on adaptation and resilience to climate shocks because the past is no longer a reliable guide to the future in this arena. Some indirect effects of climate change include more political and social focus on water in the next decade from policymakers, activists, and the public. Climate shocks will force many countries to change the way they manage water and other resources, and companies should prepare for heightened scrutiny of their water use. S&P Global Market Intelligence projects frequent and deeper droughts and floods that may put a dent in electricity generation and cause disruptions in agriculture-dependent regions. Developing adequate water supplies will become an essential feature of long-term economic diversification planning.
Water Utility Outlook
Inflation is expected to ease for U.S. water utilities, with Fitch Ratings upgrading the sectoral outlook from “deteriorating” to “neutral.” With the sector on a more stable footing, water utilities are more confident about 2024 budgeting, with only moderate cost increases for treatment chemicals, workforce, supplies, and energy. Additionally, the increased frequency of more extreme weather events and the threat of cyberattacks will drive water utilities to improve resilience against both in 2024.
Green Hydrogen
Tax policy snags have complicated the rollout of $7 billion in Bipartisan Infrastructure Law (BIL) funding for green hydrogen production at seven Regional Clean Hydrogen Hubs (H2Hubs) in the U.S. It is hoped that the hubs will establish a national network of green hydrogen producers, but production requires a great deal of water. Regardless of initial red tape, Global Water Intelligence is projecting a significant opportunity for the water sector to support the hydrogen economy, with demand expected to double year-on-year to 2030.
Contaminants, Emerging and Familiar
Reese Tisdale of Bluefield Research has been focusing on the importance of addressing PFAS contamination due to rising health concerns and major policy changes. The recent Environmental Protection Agency (EPA) stand on PFAS chemicals has not only sparked action in the U.S., but also around the world, so PFAS solution providers will likely see substantial growth.
Between 2023 and 2030, spending by drinking water utilities is expected to climb to nearly $13.5 billion, driven by the new EPA proposed Maximum Contaminant Limits (MCLs) as well as legal hits taken by polluters, such as 3M’s recent $12.5 billion settlement. Europe is also ramping up tougher regulations, mirroring the action seen in the U.S., and Australia is revisiting PFAS standards due to high-profile incidents and global attention. Technology and solutions providers are preparing as the narrative about PFAS chemicals evolves on a global scale.
U.S. water utilities continue to face great pressure to remove all lead and copper from their systems due to the EPA’s revised Lead and Copper Rule. The policy states that water authorities must provide an initial inventory of all lead pipes by the fall of 2024, forcing a granular, sometimes door-to-door search for old infrastructure that must be replaced.
A Decentralized and Distributed Water Future
The coming year is likely to see growing interest in decentralized and distributed water and wastewater solutions. Decentralized and distributed treatment involves the strategic placement of scaled-down water assets in smaller service areas. Seven Seas Water Group maintains a special focus on this type of treatment, and other voices are positive about the strategy in 2024.
Discussing the prospects of decentralization in 2024, Newsha Ajami, chief officer for research at the Lawrence Berkeley National Laboratory said:
It is exciting to see the growing interest in distributed and decentralised water solutions like small-scale and building-level water reuse (also known as onsite reuse), greywater systems, green infrastructure, and rainwater/stormwater capture.
Ajami expects the existing trend to ramp up in 2024, with wider adoption globally as communities struggle to weather more extreme droughts and floods. Utilities will also need to rethink their demand projections with the help of digital tools as decentralized, full-water-cycle solutions proliferate on all scales, from homes to regions, altering usage patterns.
Digital Water Revolution
The digital water revolution is in its infancy, and the adoption of digital water tools such as smart metering and remote sensing will continue in 2024. The software-as-a-service model is expected to continue growing, and AI will support it, allowing data integration and advanced analytics.
Seven Seas wastewater treatment plants have all adopted an integrated computerized maintenance management system (CMMS) that allows plant operators to plan preventive maintenance and generates overview reports regarding the plant’s general health and performance, identifying problems before they become serious. Data trends can be tracked and operators notified ahead of failures.
Public-Private Partnerships for Water Infrastructure
Public-private partnerships (P3s) will continue to proliferate in 2024 as decision-makers and the public become more familiar with the concept and work through some ambivalence surrounding it. In practice, states and even countries have been rolling out legal frameworks to improve, standardize, and encourage contracts.
Seven Seas is demonstrating the advantages of P3s with the first P3 brackish water desalination plant in Texas. The plant is projected to be operational by the second quarter of 2024. The Water-as-a-Service® (WaaS®) P3 model offered by Seven Seas has relieved the potential debt burden of the taxpayers of Alice, Texas, by millions because the contract required no capital expenditure. The deal is lowering the current cost of water in Alice and guaranteeing it long-term with no initial cost.
Agri-Food Industry Water Stewardship
The $6 trillion global agri-food industry, which is responsible for 70% of the world’s freshwater withdrawals, faces water depletion, pollution, and climate change-associated droughts, all making water more difficult and contentious to source. The Whole Foods Trends Council believes water stewardship will be one of the top food trends for 2024. Water efficiency in the food and hospitality sectors will be one focus. Food and beverage sector brands will seek to shrink their water footprints, touting the results in marketing. Many companies will consider shifting their lines to more plant-forward products due to the extreme water use of livestock farming.
Seven Seas Looks Ahead to 2024
Seven Seas is uniquely positioned to address the water challenges of 2024 and beyond. We’re bringing resilience to water infrastructure that is in the direct path of some of the most powerful storms in the Caribbean. We’re bringing drought resilience and water independence to communities through desalination. We’re recycling water so drinking water doesn’t have to be wasted on nonpotable water applications. We’re addressing contaminants with cutting-edge technologies and working with food manufacturers on a wide range of processes. We’re at the forefront of decentralization with the modular equipment to make it work. And, as always, we’re offering flexible financing, along with leasing options, that removes the obstacles for decision-makers the modern way. Contact Seven Seas to talk about water and wastewater treatment in 2024.
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Leslie May is the Senior Marketing Manager for both AUC Group and Seven Seas Water Group. She joined the company in 2017 after serving in various marketing roles in the oil and gas industry. Mrs. May is responsible for creating and implementing marketing strategies, developing sales copy, liaising with company stakeholders, planning events, and managing the website and social media activity. She ensures brand consistency and promotes the company and its services, targeting the correct and appropriate audiences. Mrs. May graduated from the University of Texas at Austin with a Bachelor of Science degree in Communication Studies.