Aug 01, 2012

Global Water Design-Build-Operate Market Expected To Grow Rapidly, Says Frost & Sullivan

Global municipal water DBO market expected to reach $185.21 billion by 2020

The global pressure to manage existing water resources more efficiently and to provide sustainable water solutions in terms of water reuse, recycling and desalination plants, adopting smart technologies and reducing carbon footprint, promises attractive upside potential for the water design-build-operate (DBO) market. The demand for integrated water operation and management will further extend outsourcing of water supply and wastewater services, delivering good opportunities for DBO companies specialized in overall project and service provision.

New analysis from Frost & Sullivan finds that the global municipal water DBO market earned revenues of $84.68 billion in 2011 and estimates this to reach $185.21 billion in 2020.
Rapid urbanization, uneven distribution of water services, poor water quality and myopic exploitation of existing resources are urgent issues that sustainable water management solutions can address. A key factor that has resonated profoundly in the water market in the last few years is the need for local solutions in a globalizing marketplace. These factors increase the pressure for high-quality water and wastewater services, shaping the global water DBO.

"While construction of new water and wastewater infrastructure is expected to expand in emerging markets there are enormous modernization and rehabilitation needs in developed nations dedicated to aging infrastructure," said Frost & Sullivan Research Analyst Paulina Szyplinska. "Growth in developing markets is expected due to expansion of adequate facilities while that in the developed market will revolve around the improvement of drinking water quality and water reuse."

Due to the complexity of water business, provision of package services is highly beneficial. Implementation of integrated water cycle is the responsibility of local water authorities and can be improved by outsourcing the water supply and wastewater services. This opens new opportunities for DBO water companies specialized in complex project delivery.

"The key part in the formulation of the DBO contracts lies in the assimilation of ‘operation’, aiming at combining it into an attractive package of design, build and operation for the contractor, and allowing for faster and more cost-efficient project delivery," opined Szyplinska.

Overall, companies offering sustainable solutions and packaged services for the global water DBO market can look forward to sharp growth in the years to come. Participants will need to have clear geographic priorities, balanced business models and state-of-art technologies to constantly stay ahead of environmental challenges and client needs.