Waterfalls

Water Technology Innovation

Why invest in water technology innovation

 

Around the world, cities, farmers, industries, energy suppliers and ecosystems are increasingly competing for their daily water needs. Without proper water management and concrete innovation in this sector, the costs of this state of things can be high – not just financially, but also in terms of lost opportunities, compromised health and environmental damage. In the absence of major policy changes and much better water management, the situation will deteriorate and water availability will become increasingly uncertain. 

The water issue has become increasingly important in international politics due to tensions related to water control. In all continents the risks of clashes around shared aquifers, rivers and lakes are multiplying: Nile, Jordan, Mekong, Tigris and Euphrates, Ganges, Colorado, etc.

The growth of migration processes towards Europe is also attributed to the reduced availability of water. In particular, the drying up of Lake Chad, located in the Sahel area south of the Sahara, has, for some time, triggered an intense process of migration towards European countries. 

 

In such a scenario, there are many opportunities for the industry sector and the finance market.

There is a problem with the quantity but also with the quality of water.

Water demand is projected to increase by 53% globally between 2008 and 2030

  • The “Water 2030 Global Water Supply and Demand model” promoted by the World Bank Group indicates that global water consumption will increase by 53% between 2008 and 2030. The increase in consumption will mainly take place in agriculture (+ 45%), in industry (+ 88%) and in municipal and domestic consumption (+ 50%).

  • Agriculture is the sector in which more water is used globally. Irrigation of agricultural land accounts for 70% of the water used universally. In developing countries, irrigation makes up 95% of global water use and plays a key role in food security. The development of these countries will depend on the possibility of expanding irrigated agriculture.

  • If the global gap is not filled, developing and emerging economies will suffer the most. In these countries, increasing water scarcity and deteriorating water quality are already critical issues today.

 

  • Global changes such as rapid urbanization and climate change amplify these concerns. The need for safe treatment of wastewater is fundamental to the well-being of societies, economies, and the environment.

  • Israel expects its water consumption to nearly double between 2000 and 2050.  Only 25% of its needs can be covered by natural drinking water. The rest will be covered by desalination (55%) and recycling (20%).​​​​

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InnVenture is strongly committed to supporting water technology innovation to make agriculture

more efficient and improve living conditions.

The global water gap is very significant in financial terms

  • Assuming no efficiency gains, the aggregated global gap between existing accessible, reliable and sustainable supply and 2030 water withdrawals will be worth 2,700 Billion m3

  • Considering the expected increases in productivity of supply and demand, the global water gap in 2030 may be reduced from 2,700 to 1,700 billion m3 (60%) but cannot be canceled.

 

  • Assuming that the global water gap can be met by desalination technologies alone, an investment of between US$3,000 and US$6,000/billion is required, depending on the technology used.  In addition, the average operating cost to produce 1.7 trillion m3 is USD 850/billion per year.

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In addition to the problem of quantity, there is a problem of the "quality" of the available water.

  • Climate change tends to increase the earth's temperature and cause salinization and desertification of cultivated land and melting of glaciers,

  • Industrialization in the most advanced countries over the last century has contributed significantly to polluting rivers and lakes, especially in urban areas. Uncontrolled dumping of chemicals and debris from construction activity have rendered some rivers unfit for use,

  • Urbanization, industrialization, and agricultural development in high-growth countries (BRIICS) are producing increased soil water extraction, groundwater contamination, and the release of micropollutants into the sea,

  • In Sub-Saharan Africa, only 24% of the population uses a safely managed drinking water service. This percentage is even lower in North Africa and Asia.

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Climate change, industrialization and urbanization negatively affect the global water system

The market of water technologies is huge 

In conclusion, there is a great need to make things better and there is a lot of room to innovate products, services and technologies and make high return investments. The water-tech market is very large and the EBITDA multiples in M&A deals are growing steadily.

 

On the other hand, it must also be said that:

  • Large investments in Research and Innovation are urged and funded by "Europe 2020-Strategy for Jobs and Growth" (ERDF and ESF funds) and Horizon 2020. Environmental sustainability and green growth are identified as priorities in European development policy. 

  • In recent years, institutional investors have paid great attention to the "green" sector, dedicating increasing resources and energy to its development.

  • Unesco and OECD indicate in water the key factor for the future of the world both for development and for security and peace. Owning the technology in this sector is crucial for the industrial growth of Europe.

Key Figures of Water Technology Industry

  • Increase in Global Water Consumption 2008-2030: +53%

  • Global Water Gap in 2030: 1,700 billion m3

  • People without access to safe water supplies in 2020 globally: 2.1 billion

  • Estimated Operational Costs and Investment required to satisfy the Global Water Gap with desalination alone: 850 USD/bln per year and 3,000 - 6,000 USD/bln

  • Estimated Global Water Market in 2025: 900 USD/bln (CAGR = 6-8%)

  • Estimated Water Technology Market in 2025: 325 USD/bln (CAGR>10%)

  • Planned Investments in global Public Private Partnerships 2016-2020: 58 USD/bln

  • Investment needs for updating water infrastructures in USA by 2040: 152 USD/bln

  • EBITDA multiples in water-tech deals : 20-23 (since 2016)

Our Services

Our consulting services are as follows:

  • Industry: we help companies develop new technologies, create new products and services, innovate manufacturing processes, develop new business models, and select the best partner in M&A initiatives,

  • Institutional Investors: we help investors to understand the evolution of this sector and to select the best companies for acquisition,

  • Institutions: we help public agencies and private institutions better understand environmental quality through "big data" analysis of groundwater quality and to assess the impact of their investments.

Plant & sistema di irrigazione
Image by Jonathan Chng

Our know-how

Our background comes from the many manufacturing industries we have worked in such as: 

  • Irrigation Systems

  • Hydraulics systems

  • Thermo-hydraulic systems

  • Hydropower technology

  • Hydropower generation

  • Wastewater technology

  • Drinking water technology

  • Mineral water production

  • Production of water-from-air