The use of smart water infrastructure enables cities to better manage their water distribution networks in the face of climate disruption. Turning the existing static network of water pipes and pumps into adaptive and connected networks provides huge benefits in reduced water and energy consumption. The opportunity will benefit both operators and consumers, as the reliability of delivery will increase while water supply costs decrease.
Access to clean water is a growing challenge for urban communities in the face of climate change. Making matters worse, much water is lost before it reaches consumers’ taps due to inefficient water management systems and aging infrastructure prone to leaks. Technological innovations offer hope for this sector, as smart water systems are designed to gather meaningful and actionable data about the flow, pressure, and distribution of a city’s water, which can be used to better serve customers and prevent losses. Developing newer and smarter products and services around smart water management is our best bet in reducing massive water losses in pipes and shrinking overall water consumption.
Products and Services
Smart sensors form the backbone of the products and services within the smart water opportunity space. Smart sensors on pipes and other critical water management infrastructure have the ability to detect leaks, measure water-related data, including rainfall, pH, temperature, turbidity, flow, pressure, and even contamination levels. As internet of things devices, smart sensors are Wi-Fi enabled, allowing data to be sent in real time to cloud storage. Therefore, to be truly effective, smart sensors are integrated with advanced software systems capable of handling and managing these large datasets in real time. In doing so, municipalities can utilise this data to improve service, stop leaks, and boost efficiency.
The strength in this opportunity space is its ability to offer water utilities specific paths towards operating cost and carbon footprint reductions, while improving service and supply management.
Market Size and Demand Drivers
Utilising cutting-edge technologies is a prime opportunity for this field, as the global market for smart water management is estimated to grow from 8.46 billion USD in 2016 to 20.10 billion USD by 2021, at a compound annual growth rate (CAGR) of 18.9 percent during this period. Zooming in on the opportunity, the market for smart water metering is expected to grow from an estimated 3.88 Billion USD in 2016 to 5.51 Billion USD by 2021, at a CAGR of 7.23 percent from 2016 to 2021. North America dominates the smart water metering market, but Europe is expected to show significant growth rates in the coming years.
The need to replace aging water infrastructure is expected to be the biggest market demand driver for smart water management in the coming years. In addition, climate change and urbanisation will continue to put enormous pressure on natural resources and urban systems, and smart water systems are an opportunity to tackling these climate disruptions. Hence, continued frequency of droughts and water shortages will drive the demand for smart water technology in the long term.
The adoption of smart water technology in cities is perceived as the top market opportunity across all regions surveyed in 2016. The market opportunity tends to be more popular in the regions with a high Human Development Index score. Respondents in Europe and South East Asia & Australia rate it very positively which is echoed by the respondents in India, MENA, and Sub Saharan Africa.
Politicians are not perceived by the leaders we surveyed in 2016 to have a strong capacity to make this market grow. However, leaders are confident their regions already hold the sufficient technological and economical capacities to pursue smart water technology.
Taking a regional look at how leaders view this opportunity, a number of notable differences emerge. Leaders in the MENA region perceive this market opportunity to has a strong business case. In China, respondents also think this market opportunity holds strong business case and has high impact on business. Hence, demand for smart water technology in China can be expected to grow.
Leaders in the survey expect both civil society and business to advocate strongly for the smart water tech market. Hence, we can expect civil society-private sector partnerships to shape this market. The manufacturing sector sees a particularly good business case in smart water tech.
In China, leaders believe the financial sector is most likely to be active on the smart water market. However, although the finance sector regards smart water technology as a good opportunity, respondents from that sector are sceptical about the probability of their own organisation pursuing this market opportunity.
This market was surveyed globally in 2016 by more than 5500 leaders from both the public and private sectors. The survey was conducted in collaboration with the research company YouGov. The survey results were originally published in the Global Opportunity Report 2017.