A BCC Research Membrane & Separation Technology Report

Seawater and Brackish Water Desalination September 2010 • MST052B

Use this report to: • U  nderstand the technical aspects of both thermal and membrane desalination processes, as well as alternative techniques that may be viable in the future • I dentify the developments that are making desalination affordable for countries that were previously unable to consider it, creating a robust and rapidly growing market • F orm business plans based on an analysis of the water needs of 45 countries in five world regions, including known projects by country for the next 5 to 10 years, estimated capacity additions, market values, and growth rates for each world region • M  aintain a competitive standing based on an assessment of the market share held by membrane manufacturers operating in the desalination business, and an evaluation of current and future markets for membrane equipment used for desalination.

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Introduction The 2010 market value for desalination plant equipment is estimated at $2.9 billion, rising at a compound annual growth rate (CAGR) of 13.8%. By 2015, the total global market worth is expected to reach $5.5 billion.

Water is essential to the survival and growth of humankind, but the earth’s finite freshwater reserves are dwindling—a situation that will place the challenge of developing new sources at the forefront of global sustainability concerns for decades to come. Technologies that enable more efficient water use, such as water reclamation and recycling, decreasing water losses, and desalinating saline water, are promising business opportunities. Because of the potentially unlimited availability of seawater, numerous efforts have been made to develop inexpensive and effective desalting technologies for converting saline water into freshwater. Water stress and shortage are the primary factors driving the market for desalination technology. Growing populations, increased demand for water by individuals and industry, and diminishing freshwater sources due to degradation and drought have created water scarcity in many world regions. With desalination, brackish water and seawater represent a new and potentially unlimited supply of high-quality water, especially in light of dramatic cost reductions in the reverse osmosis (RO) process. Desalination is also an environmental issue because it uses large amounts of energy, and in the case of RO, it discharges concentrated brine. Two major process types—thermal (distillation) and membrane-based—are employed for desalting saline water. During the past decade, technical improvements in membrane-based RO desalination have increased energy efficiency of the desalination process and reduced RO operating costs. BCC Research report Seawater and Brackish Water Desalination-MST052B provides the information about the desalination systems have emerged as effective solutions for transforming saline, brackish, and contaminated water into useable and/or potable products as with each passing year, the quality of the planet’s water measurably deteriorating presenting challenges for the major users. The report is useful to the broad audience of business, technical, and regulatory practitioners on a global scale. Engineers, utilities, and corporate planners will benefit from accessing information on the global demand for desalination plants. The information for the report has been collected through re-analysis of the available technical and business literature, as well as an evaluation of the personal records of the water treatment industry. Conversations with industry experts and company representatives, along with a review of their published works, provide the backbone for an evaluation of the desalination industry. SUMMARY FIGURE GLOBAL MARKET FOR SEAWATER AND BRACKISH WATER DESALINATION PLANTS, 2000–2015 ($ MILLIONS) 6,000

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$ Millions

5,000 4,000 3,000 2,000 1,000 0

2000

2005

2007

Conventional processes Source: BCC Research

2009

2010

2015

Other technologies

Scope of Study The scope of this report is broad and includes:

Sales of reverse osmosis (RO) equipment currently account for nearly 95%, or $1.4 billion, of the 2010 membranebased desalination market. Globally, RO is forecast to grow at a compound annual growth rate (CAGR) of 17.5% for desalination applications over the next 5 years to reach a value of nearly $3.2 billion in 2015.

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• Descriptions of various desalination methods, including multistage flash distillation, multieffect distillation, vapor compression, reverse osmosis and nanofiltration • The current market status of seawater and brackish water desalination plants, with data from 2009, estimates for 2010, and projections of compound annual growth rates (CAGRs) through 2015 • Discussion of novel desalination methods, including freezing, gas hydrate formation, membrane distillation and capacitive deionization • Analysis of the seawater and brackish water desalination plants industry on a worldwide basis, both from market and application perspectives • Information about large and small companies working on desalination plants.

Table of Contents Chapter One: Introduction Study Goal and Objectives Reasons for Doing The Study Intended Audience Scope of Report Information Sources Analyst Credentials Related BCC Publications BCC Online Services Disclaimer Chapter Two: Summary Summary Summary Table Global Market for Seawater and Brackish Water Desalination Plants, Through 2015 ($ Millions) Summary Figure Global Market for Seawater and Brackish Water Desalination Plants, 2000–2015 ($ Millions) Chapter Three: Technology Overview Water Quality Safe Drinking Water Standards Water Quantity Water Salinity Table 1 Water Salinity and Suitability for Human Consumption (Mg/L) Table 2 Salt Concentrations of Various Global Waters (Ppm) Table 3 Water Hardness Source Waters Used for Desalination Table 4 Total World Desalination Capacity By Source Water Type, 2010 (%) Figure 1 Total World Desalination Capacity By Source Water Type (%) Desalted Water End Uses Table 5 Global Desalted Water End Uses As A Percentage of Total Capacity (%) Figure 2 Global Desalted Water End Uses As A Percentage of Total Capacity (%) Desalination Technologies Brief History of Desalination Figure 3 Desalination Technologies Membrane Technologies Thermal Technologies Comparison of Thermal and Membrane Technologies Table 6 Comparison of Process Characteristics Comparative Costs of Desalination Technologies

Table 7 Global Comparative Costs of Thermal and Membrane Technologies ($/M3) Global Desalination Installations Table 8 Global Installations By Number of Plants and Capacity, 1945–2009 (M3/D) Figure 4 Global Installations By Capacity, 1945–2009 (M3) Table 9 Largest Desalination Plants By Capacity, Commissioned Or Contracted, July 2010 Table 10 Global Market Share By Technology Type, 2010 (%) Figure 5 Global Market Share By Technology Type, 2010 (%) Chapter Four: Membrane Technologies Reverse Osmosis Table 11 Membrane Manufacturers and Product Types Nanofiltration Electrodialysis Cost of Technologies Capital Costs Table 12 Global Capital Costs of Membrane Desalination By Technology Type and Plant Size (Avg. $/Gal.) Operating Costs Table 13 Cost Allocation of Desalinating Brackish Water with RO (%) Figure 6 Cost Allocation of Desalinating Backish Water with RO (%) Table 14 Cost Allocation of Desalinating Seawater with RO (%) Figure 7 Cost Allocation of Desalinating Seawater with RO (%) Cost Trends Table 15 Global Cost Trends for Membrane Desalination, Including Debt Service and Operating Expenses, 1980–2010 ($/1,000 Gals) Figure 8 Global Cost Trends for Membrane Desalination, Including Debt Service and Operating Expenses, 1980–2010 ($/1,000 Gals) Table 16 Seawater Element Cost, 1978–2005 ($/1,000 Gals) Figure 9 Seawater Element Cost, 1978–2005 ($/1,000 Gals) Table 17 Global Seawater Desalination Cost Reductions Figure 10 Global Seawater Desalination Cost Reductions ($/1,000 Gals. (3.8 M3)) Market Share

Table of Contents, continued Thermal desalination methods have been losing market share to RO for the past several years, a trend that is expected to continue. The market for thermal-based desalination equipment is estimated to reach nearly $1.4 billion by the end of 2010 and rise at a compound annual growth rate (CAGR) of 9.7% to reach $2.2 billion in 2015.

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Table 18 Global Membrane Manufacturer Market Shares, 2009 (%) Figure 11 Global Membrane Manufacturer Market Shares, 2010 (%) Market Value By Membrane Technology Type Table 19 Global Market Forecast By Membrane Technology Type, Through 2015 ($ Millions) Figure 12 Global Market Forecast By Membrane Technology Type, 2000–2015 ($ Millions) Chapter Five: Thermal Technologies Multistage Flash Distillation Cost Table 20 Cost Allocation of Desalinated Water Production with MSF (%) Figure 13 Cost Allocation of Desalinated Water Production with MSF (%) Table 21 Global MSF Desalination Cost Trends, 1955–2010 ($/Gal) Figure 14 Global MSF Desalination Cost Trends, 1955–2010 ($/Gal) Multi-effect Distillation Cost Table 22 Cost Allocation of Desalinated Water Production with Med (%) Figure 15 Cost Allocation of Desalinated Water Production with Med (%) Vapor Compression Market Value By Thermal Technology Type Table 23 Global Market Forecast By Thermal Technology Type, Through 2015 ($ Millions) Figure 16 Global Market Forecast By Thermal Technology Type, 2000–2015 ($ Millions) Chapter Six: Other Technologies Crystallization Freezing Gas Hydrate Processes Membrane Distillation Memstill Solar Humidification Flow-through Capacitor Ion Exchange Market Value of Other Technologies Table 24 Global Market Forecast for Other Technologies, Through 2015 ($ Millions) Figure 17 Global Market Forecast for Other Technologies, 2000–2015 ($ Millions) Chapter Seven: World Markets for Desalination Table 25 Global Water withdrawals By Sector (%) Figure 18 Global Water withdrawals By Sector (%) Table 26 Absolute Water Stress Or Shortage in The 20 Most Affected Countries, Projected To 2025 Table 27 Water Stress Or Shortage in The 20 Most Populous Countries, Projected To 2025 World Market By Region Table 28 Desalination Capacity By Technology and World Region, 2009 Figure 19 Desalination Capacity By Technology and World Region, 2009 (M3/D) Table 29 Countries with The Largest Installed Desalination Capacity, 2009 (M3/D) Figure 20 Countries with The Largest Installed Desalination Capacity, 2009 (M3/D) Table 30 Market Value By Global Region, Through 2015 ($ Millions) Figure 21 Market Value By Global Region, 2000–2015 ($ Millions) U.S. and Canada Economic Trends Water Needs

Table 31 Water Distribution in The U.S. By Sector (Billion Gpd/%) Figure 22 Water Distribution in The U.S. By Sector (%) Table 32 Total U.S. Freshwater withdrawals By State, 2005 (M3/D) Desalination Capacity Table 33 U.S. Desalination Capacity Share By Source Water Type (%) Figure 23 U.S. Desalination Capacity Share By Source Water Type (%) Table 34 U.S. Desalination Capacity Share By Technology Type, 2010 (%) Figure 24 U.S. Desalination Capacity Share By Technology Type (%) Table 35 U.S. States with The Largest Installed Desalination Capacity, 2010 Table 36 U.S. Desalted Water End Uses As A Percentage of Total Capacity, 2010 (%) Figure 25 U.S. Desalted Water End Uses As A Percentage of Total Capacity, 2010 (%) Outlook Heartland Mid-atlantic Figure 26 Potentially Usable Water From U.S. Saline Aquifers Oil, Gas, and Coal Basins Inland Urban Areas Coastal Urban Areas Florida The Tampa Bay Experience California Figure 27 California’s Proposed Seawater Desalination Plants Texas Figure 28 Proposed Desalination Plants in Texas Value of The U.S./Canadian Market Table 37 U.S./Canada Market Value By Technology Type, Through 2015 ($ Millions) Figure 29 U.S./Canada Market Value By Technology Type, 2000–2015 ($ Millions) Europe Economic Trends Water Needs Spain Outlook Italy Outlook Malta Outlook Cyprus Outlook Greece Outlook U.K. Outlook Installed Capacity Table 38 Europe’s Installed Capacity By Country, 2009 (M3/D) Figure 30 Europe’s Installed Capacity By Country, 2010 (M3/D) Value of The European Market Table 39 Value of The European Market By Technology Type, Through 2015 ($ Millions) Figure 31 Value of The European Market By Technology, 2000–2015 ($ Millions) Middle East/Africa Economic Trends Water Needs Saudi Arabia

Table of Contents, continued

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Outlook UAE Outlook Kuwait Outlook Bahrain Outlook Algeria Outlook Libya Outlook Jordan Outlook Qatar Outlook Egypt Outlook Israel Outlook Tunisia Outlook Turkey Outlook South Africa Outlook Value of The Middle East/Africa Market Table 40 Value of The Middle East/Africa Market By Technology Type, Through 2015 ($ Millions) Figure 32 Value of The Middle East/Africa Market By Technology Type, 2000–2015 ($ Millions) Asia-pacific Economic Trends Water Needs Australia Outlook China Outlook India Outlook Indonesia Outlook Japan Outlook The Philippines Outlook Singapore Outlook Taiwan Outlook Value of The Asia-pacific Market Table 41 Value of The Asia-pacific Market By Technology Type, Through 2015 ($ Millions) Figure 33 Value of The Asia-pacific Market By Technology Type, 2000–2015 ($ Millions) Latin America/Caribbean Economic Trends Water Needs The Bahamas Outlook Chile Outlook Jamaica Outlook Mexico Outlook Value of The Latin America/Caribbean Market Table 42 Latin America/Caribbean Market Value By Technology Type, Through 2015 ($ Millions) Figure 34 Latin America/Caribbean Market Value By Technology Type, 2000–2015 ($ Millions)

Chapter Eight: Patent Analysis Patents By Technology Type Table 43 Patent Share By Technology Type (Number & %) Figure 35 Patent Share By Technology Type (%) Patents By Company Table 44 Patent Share By Company/Individual Patent Holder (%) Figure 36 Patent Share By Company/Individual Patent Holder (%) Chapter Nine: Technical Innovations and Research Trends Technical Innovations and Research Trends Large-area Modules NF Pretreatment for Thermal Desalination Research Trends Desalination and Water Purification Roadmap Table 45 Desalination and Water Purification Roadmap: National Needs and Recommended R&d Long Beach Method Affordable Desalination Coalition Ion Concentration New Membrane Materials Organic/Inorganic Nanocomposites Carbon Nanotube Membranes Boron Nitride Nanotube Membranes Aquaporins Oxidant-resistant Membranes Chlorine-tolerant Materials Surface-structured, Fouling-resistant Membrane Materials New Energy Options Renewable Energy Sources Table 46 Recommended Res/Desalination Combinations Solar Concentrated Solar Power (Csp) Wind Wave Nuclear Nuclear Desalination Projects Hybrid RO/Thermal Plants Brine Disposal Emerging Treatment Methods Beneficial Brine Reuse Concentrate Minimization Zero Liquid Discharge Recovery and Resale of Salts in Desalination Brine Chapter Ten: Industry Structure Industry Structure Market Share Table 47 Desalination Plant Supplier Market Share, 2009 (%) Figure 37 Desalination Plant Supplier Market Shares, 2010 (%) Company Profiles Abengoa/Befesa Agua Acciona Agua/Acciona Sa Ace Water Treatment Co., Ltd. Afton Pumps, Inc. Ahmed Abdel Warith Consulting Engineers Alfa Laval American Engineering Services (Aes) Aes Arabia, Ltd. Al Kawther Industries, Ltd./al Murjan Group Aqualia Aqualyng/Lyng Group Aquatech International Corp. Aquachem ICD Acwa (Arabian Company for Water & Power Development) Power International

Table of Contents, continued Biwater, Plc Biwater Aewt, Inc. Cadagua/Ferrovial Group Candesal Water Systems Christ Water Technology Group/Glv Aqua Engineering Gmbh Consolidated Water Co., Ltd. Corodex Industries Culligan Hellas Danfoss A/s Ro Solutions Doosan Heavy Industries & Construction Dow Water Solutions Düchting Pumps Ebara Corp. Energy Recovery, Inc. Fichtner Gmbh Flowserve Fluid Equipment Development Co. Fybroc Pumps General Electric Grahamtek Systems Grundfos Group Hitachi Zosen Corp. Hyflux, Ltd. Ide Technologies, Ltd. Ilf Consulting Engineers Indar Pump/Ingeteam Corp. Impregilo Group/Fisia Italimpianti Inima Medio Ambiente/Ohl International Power Ion Exchange (India), Ltd. Itochu Corp. Itt Water & Wastewater/Itt Industries Jgc Corp. Kindasa Water Services Koch Membrane Systems Ksb Group Kuljian Corp. Kurita Water Industries Lahmeyer International Gmbh Marubeni Corp. Malakoff Metito (Overseas), Ltd. Mitsubishi Heavy Industries Mitsui & Co., Ltd. Mubadala Development Co. Natco Group/Cameron Nternational Corp. Nitto Denko Hydranautics

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Organo Corp. Osmoflo Pb Power Poseidon Resources Corp. Pump Engineering, Inc. Reggiane Cranes & Plants Division/ Fantuzzi Group Sadyt Salt Separation Services, Ltd. Sasakura Engineering Saudi Oger, Ltd. Sembcorp Utilities Pte, Ltd. Separation Processes, Inc. Sete Energy Saudi for Indistrial Projects, Ltd. (Sete Energy) Severn Trent Services Siemens Water Technologies Snamprogetti S.p.a./Eni Saipem Snc Lavalin Sogex Oman Co., Llc Sumitomo Corp. Suez Sulzer Pumps/Sulzer Corp. Tam Environmental Services/Tam Group Tedagua/cobra Group (Acs) Tenaga Nasional Berhad Toray Industries Torishima Pump Manufacturing Co., Ltd. Toyobo Co., Ltd. Uem, Inc. Veolia Water Solutions & Technologies Water Engineering & Management Services Wetico Woongjin Chemical Appendix: Patent Surveys Table 48 Patent Survey, 2005 Table 49 Patent Survey, 2006 Table 50 Patent Survey, 2007 Table 51 Patent Survey, 2008 Table 52 Patent Survey 2009 Table 53 Patent Survey, 2010

233 pages 53 tables

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