Boston, Massachusetts - An increasing focus on resiliency and water supply risk is driving investment in water reuse, or reclaimed wastewater solutions. New capacity additions in the U.S. municipal water sector are forecasted to surpass US$21.5 billion from 2017 to 2027, according to a new report from Bluefield Research, U.S. Municipal Water Reuse: Opportunities, Outlook, & Competitive Landscape, 2017-2027.

“Climate volatility, such as the hurricane in Houston and California’s five-year drought, are forcing municipal utilities to seek alternative strategies to de-risk existing water supplies, and water reuse has become key solution in their contingency plans,” says Erin Bonney Casey, Bluefield Research Director. “Just look at the rise in reuse projects in the pipeline. In 2015, Bluefield monitored 247 projects across 11 states. Now we are tracking more than 775 reuse projects across 19 states,” added Ms. Bonney Casey.

At the epicenter of U.S. reuse activity are three states– California, Texas and Florida– which represent 80 percent of planned capacity additions. Even after the rains arrived last year, California utilities demonstrated a paradigm shift by proceeding to move forward with more than 6.0 million m3/d of new reuse supplies, including systems for potable application. Bluefield forecasts 2.2 million m3/d of potable capacity additions over the next decade, across the U.S., mainly in urban centers.

The U.S. Municipal Wastewater Reuse Landscape, 2017-2027

Source: Bluefield Research
Source: Bluefield Research

“Central to the adoption of potable reuse are California regulators, who are progressing towards a streamlined potable reuse policy. This is important nationwide, because the passage of a dedicated policy is expected to serve as a template for other state regulators seeking to facilitate efficiencies in water usage,” according to Bonney Casey.
With investment in municipal reuse expected to grow 15% over ten years, compared to only 1% annually for municipal water infrastructure generally, reuse presents a major growth opportunity in a traditionally slow-paced sector. The majority of CAPEX spend for reuse over the next decade will go to pipes (42%), advanced treatment technologies & solutions (40%), and engineering & design (13%).

“Competition is high, as the potential for growth and more advanced systems has attracted a host foreign and domestic players. Market growth, coupled with demand for potable water solutions, benefits those firms supplying reverse osmosis, ultraviolet, and membrane bioreactor systems, among others. As a result, companies like IDE Technologies, Trojan UV, Calgon Carbon, GE, and Xylem are poised for growth.”

While much focus is centered on municipal utilities, industrial companies are expanding their role in water reuse adoption, as an off-taker for treated wastewater to supplement their ongoing water needs. Bluefield has identified electric power plants, oil refineries, and upstream oil & gas players as the biggest opportunities for reclaimed wastewater.

“Historically, irrigation for agriculture, urban green spaces, and golf courses have been the primary applications,” says Bonney Casey. “But now, we see craft breweries and data centers using recycled wastewater, as well as an increasing interest in onsite, or decentralized reuse systems, in commercial facilities for toilets, cooling, and landscaping.”