LONDON, England, Nov. 9, 2011 -- The world's top five water companies who have historically dominated the international water sector are losing their market share to regional firms.
To put this into perspective, in 2001 around 73% of the private water market was taken by the "big five", including Veolia Water and Suez Environnement, but in 2011 this is estimated to have decreased to 31%, with local players eating up market share.
Increased activity and development of regional utilities in China is partly responsible for the move, with five Chinese companies now serving more than 15 million people.
This is according to the new 13th edition of the Pinsent Masons Water Yearbook, providing a detailed annual snapshot of the global water industry.
Dr David Owen, author of the report and managing director of Envisager, emphasised the sector is moving from the "international model to the local model".
The report highlighted how in 1999 only 5% of the world's population was served by the private water sector. Owen estimated this to increase to 13% in 2011, 16% by 2015 and 21% by 2025.
The 2002 yearbook cited that the acquisition of market share by the top five leading companies - Suez, Veolia, SAUR, Agbar and RWE - was a "remorseless process". However, this year Owen said "it is evident that when events turn against them, the retreat has been equally remorseless. This year will be their last in terms of the top five."
Mark Lane, head of Pinsent Masons' water group, said that smaller, more localised companies have "stepped in where the major players are less keen to tread. These smaller companies are also more flexible, allowing them to create new initiatives when conventional approaches have failed to deliver satisfactory services."
According to Owen, this will have the affect of pushing companies into promoting their work on wastewater contracts, as well as drinking water contracts. The report also included data on the treatment capacity for water and wastewater of companies, as opposed to populations served, for the first time. Veolia Environnment came out top, treating 9.8 billion m3/year of drinking water and 7.3 billion m3/year of wastewater, totalling 16.1 billion m3/year.
Last year Water & Wastewater International (WWi) reported after the previous yearbook launch how the top five firms accounted for 68% of market share in 1999, decreasing to 34% in 2009 (see WWi story).
Owen also warned delegates at the launch about global access to water and sanitation services. "It's time for a new water and wastewater vision," he said. "The Millennium Development Goals have been a complete failure. It's time to stop patronising people and time to get the job done."
Owen later said: "By 2050 all people should have access to water and sanitation, with no wiggle room. If we [the industry] can't do that then we might as well leave the room with our heads held in shame."
- A full analysis of the Water Yearbook will be included in the December-January issue of Water & Wastewater International magazine. To sign up for a free subscription, please click here.