Membrane Multiplier: MBR set for Global Growth

Increasing, stringent legislation governing wastewater disposal has helped propel Membrane Bioreactor technology for both municipal and industrial applications.

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Increasing, stringent legislation governing wastewater disposal has helped propel Membrane Bioreactor technology for both municipal and industrial applications. Seth Cutler looks at the global players involved and how technological innovation has helped reduce prices.

Membrane Bioreactor (MBR) Process

Describing its MBR process, GE Water says that ultrafiltration membranes are immersed in an aeration tank, in direct contact with mixed liquor. Through the use of a permeate pump, a vacuum is applied to a header connected to the membranes. The vacuum draws the treated water through the hollow fiber ultrafiltration membranes. Permeate is then directed to disinfection or discharge facilities. Intermittent airflow is introduced to the bottom of the membrane module, producing turbulence that scours the external surface of the hollow fibers. This scouring action transfers rejected solids away from the membrane surface. Membrane bioreactor technology effectively overcomes the problems associated with poor settling of sludge in conventional activated sludge processes, adds GE.

MBR technology permits bioreactor operation with considerably higher mixed liquor solids concentrations than conventional activated sludge systems that are limited by sludge settling. GE's MBR process is typically operated at a mixed liquor suspended solids (MLSS) concentration in the range of 8,000 to 10,000 mg/L. Elevated biomass concentrations allow for highly effective removal of both soluble and particulate biodegradable material in the waste stream.

Membrane bioreactor (MBR) systems may not be the only option for wastewater treatment but it has been acknowledged that MBR systems are among the most effective treatment solutions available. In light of the benefits, water intensive industries and municipal wastewater services are growing more and more interested in MBR units.

As a result, the global market for membrane bioreactor (MBR) systems grew to $838.2 million in 2011 and is projected to increase up to $3.44 billion by 2018. This represents a compound annual growth rate (CAGR) of 22.4% over this time period. Such impressive market growth can be seen as a reaction to global mega trends such as urbanization and water stress, that are now clearly shaping our future.

Membrane Bioreactor (MBR) Process

Describing its MBR process, GE Water says that ultrafiltration membranes are immersed in anaeration tank, in direct contact with mixed liquor. Through the use of a permeate pump, a vacuum is applied to a header connected to the mambranes. The vacuum draws the treated water through the hollow fiber ultrafiltration membranes. Permeate is then directed to disinfection or discharge facilities.

Intermittent airflow is introduced to the bottom of the membrane module, producing turbulence that scours the external surface of the hollow fibers. This scouring action transfers rejected solids away from the membrane surface

Membrane bioreactor technology effectively overcomes the problems associated with poor settling of sludge processes, adds GE.

MBR technology permits bioreactor operation with considerably higher mixed liquor solids concentrations than conventional activated sludge systems that are limited by sludge settling. GE's MBR process is typically operated at a mixed liquor suspended solids (MLSS) concentration in the range of 8,000 to 10,000 mg/L. Elevated biomass concentrations allow for highly effective removal of both soluble and particulate biodegradable material in the waste stream.

As the world's urban population is now over 50%, there is an increasing burden on cities to provide high quality, reliable water and wastewater services to residential, commercial and industrial customers. This has created a strain on facilities and treatment capacities for water utilities, but it also places further demands on fresh water sources.

Market Drivers

MBR sales are being driven by increasingly strict legislation concerning discharge quality and recycling levels. Take the Clean Water Act (1983) and Clean Water Protection Act (2009) in the United States, EU Environmental Policy and the Comprehensive Working Program on Energy Saving and the Emission Elimination in China (2007). Collectively they are all pushing for better sanitation and water resource rehabilitation through effective wastewater treatment and reclamation means.

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Municipal water services are using MBR systems to increase recycling rates and recharge water resources while industry requires them to raise the wastewater discharge quality as well as benefit from water reuse.

Legislation itself is underpinned by the increasing risk of deteriorating freshwater quality and water shortages that various regions are experiencing and forecast to expect with increasing regularity and intensity. Water stress is experienced in large areas covering the Middle East, China, India, Australia, North and South Africa, Southern Europe and the Western United States. Various underlying factors are at work here. The recent boom in real estate in the Middle East, typically Saudi Arabia and the United Arab Emirates, is accelerating the demand for water recycling enabled by large MBR installations.

India and China, meanwhile, are struggling to ensure sustainable access to fresh water on a per capita basis. The increasing occurrence and acknowledgement of water scarcity in traditionally water rich regions, such as the south east of the United Kingdom, also reflects the global scale of water stress. MBR systems are well positioned as a result to form part of the long-term solution to water challenges faced around the world.

The market for global MBR solutions is also being continually driven by demand from large municipals and increasingly from medium sized industrial clients. Large scale municipal MBR installations have historically been driven by European and North American municipal wastewater services.

Globally, but especially in the developed regions of North America and Europe, growth in industrial use of MBR systems will be increasingly important sources of revenue. Specifically, industrial packaged solutions will help to minimise MBR footprint and lower impact on the immediate environment while retaining high quality treatment technology. Industrial clients will find MBR solutions necessary to conform to emerging and future water discharge and recycling standards, at times even driven by specific industrial sectors such as Food & Beverage, while remaining energy-cost efficient.

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A final overarching driver behind the global growth of the MBR market is a steady decrease in price and energy consumption levels compared with earlier models sold in the 1990s. This has been achieved by research and development progress. Technological innovation, streamlined manufacturing and value chain control and optimization have allowed major competitors to reduce prices by between 5% and 30%, with a tangible reduction in energy consumption. These two changes to MBR units have helped drive them forward in a cost sensitive market where competition between various technological solutions is strong.

Global Variations and Competition

The largest change to be seen is the shift in sales focus from, now mature, markets in Europe and North America to strong emerging markets in the Middle East and Asia Pacific, more specifically China. Stronger supplies of capital with a growing need for MBR solutions in large municipal wastewater treatment plants will drive the majority of revenues to be found in these two regions.

MBR manufacturers are now seeking to diversify their sales profiles to grow the industrial market. This is in response to the stabilised municipal sector, particularly in developed markets or Europe and North America.

Despite this pattern, MBR technology was selected through a Design-Build-Operate (DBO) model for the Fillmore Wastewater Treatment Plant in California. To ensure the over 50 year old plant was in line with stringent regulations, the most cost-effective solution was to build a new facility. Crucial to this plan's viability, however, was the cost savings seen from being able to deploy a DBO MBR system. The CAPEX for purchasing the system would have been too costly to allow the deployment to go ahead

A strong emphasis on competition will there be created between original equipment manufacturers (OEMs) to secure new municipal contracts in developing markets and to become the vendor of choice for industrial clients in developed markets.

While the large field of MBR vendors globally will continue to exist, market shares overall are consolidated where a small group of key suppliers dominate; this is expected to remain.

Leading vendors include Asahi Kasei as well as Kubota, which specializes in flatsheet MBR technology. US headquartered GE Water Technologies has been the traditional beneficiary of demand with a dominant market share due to its expertise in hollow fibre membranes, which can better handle the high demands of public wastewater treatment. Going forward, however, it is expected municipalities in Asia Pacific and the Middle East will provide the strongest growth in the municipal sector.

There is a range of other high quality competitors such as Pentair X-Flow, Siemens Water Technologies, Koch Membranes and Toray Membranes fiercely challenging to gain secure market shares as well as new entrants such as LG Electronics.

The Future of MBR

Going forward over the next decade, long-term growth and regional penetration will be driven by the ability of OEMs to form strategic partnerships and joint ventures to give them better access to established supply networks and much needed after sales service support.

The ability of OEMs to target end users directly has been a constant challenge to global expansion, especially in the emerging markets. This is often because MBR systems are part of larger projects that require broader management by engineering, procurement and construction (EPC) companies. In many markets, EPCs have established relationships with end users and have a strong sway in the wastewater treatment technology choices made. By looking to EPCs as a market entry point, established business networks can be accessed and influence can be gained.

Global conditions as highlighted above will produce strong growth for the MBR market through to 2018, seeing revenue sales of $838.2 million in 2011, which will grow to $3.44 billion. The strategic shift over this time will be the dominance of Asia Pacific and the Middle East as regions for revenue. Sales in the mature markets must diversify into the industrial sector to ensure adequate revenue generation.

This will ensure high quality wastewater discharge and the ability to substantially increase the level of wastewater recycling. Legislation is a strong driver for this market and is no longer led solely by the United States and Europe. Stricter demands are being set on wastewater treatment processes by countries all over the world. As a result, strong revenues are being found in large municipal wastewater treatment plants in developing countries.

Meanwhile, MBR systems have increased in competitiveness against traditional solutions due to cost reductions and lower energy consumption levels. Further developments will need to be seen, however, to simplify MBR operations for end users as well as to accommodate current financial uncertainties of many municipal and industrial clients. MBR suppliers that proactively deal with these challenges are likely to enjoy the strongest gains in revenue share and growth. Innovative project models such as flexible financing plans, design-build-operate (DBO) models and build-own-operate-transfer schemes will play a strong role in the future.

Authors note: The author is an analyst of the Global Water Market research team at Frost & Sullivan. The article is part of on-going research of the Frost & Sullivan Growth Partnership Service on the Global Water Markets analysing growth opportunities in the water technologies and services market. For further details, please email Fredrick Royan at froyan@frost.com.

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