Measurement & Control Market in Industrial Water & Wastewater

March 4, 2015
Monitoring to exceed $17 billion in revenues this year

About the author: Robert McIlvaine is president of McIlvaine Co. McIlvaine can be reached at [email protected] or 847.784.0012.

The market for measurement and control of water and wastewater will exceed $17 billion this year and surpass $20 billion by 2020. The industrial segment will exceed $5 billion. 

These expenditures are for instrumentation and controls, and do not include pumps and valves used to maintain flow.

Measurement & Control Market Drivers

The fastest-growing application within the market for measurement and controls this year will be combined-cycle gas turbine plants. Revenues for this segment alone will exceed $250 million. 

The market is amplified by the retrofitting of the steam cycle to a number of simple cycle plants. The additional efficiency is needed not only for the power boost but also to meet greenhouse gas targets. 

There are many variations in control and monitoring needs, depending on process options. Air cooling to condense the steam is being selected over wet cooling towers in arid areas of China and the U.S. Zero-liquid discharge systems are increasingly popular. They include evaporation loops with considerable monitoring and control. Innovations such as variable-speed pumps on the water intakes can reduce harm to aquatic life, but do require investments in controls. 

Water quality measurements include flow, quantity and other physical parameters, as well as quality measures such as contamination by particulates, organics and acids. Processes include the intake water from the source, pretreatment, ultra-pure water processes, steam, condensation, wastewater, cooling, cooling bleed stream and other miscellaneous processes. 

Most systems have a liquid fuel source to be utilized if there is an interruption in gas supply. Therefore, there are measurements needed for this loop. Some recent innovations have increased the monitoring and control investment in this area. 

The measurement and control of the ammonia used to react with nitrogen oxide also is extensive. The design is even more complex if urea is converted to anhydrous ammonia at the plant site. Many gas turbine owners choose the higher-cost urea approach due to transportation safety issues.

Other Industrial Sectors

Refineries are the second-largest industrial sector after power. Oil and gas is a big market, but one that has leveled off due to the fall in oil prices. This is reducing exploration investment.

Exploration has been estimated to be around $30 per barrel for a new source. Thus, at $50 per barrel, the exploration is going to drop substantially. However, exploration accounts for a relatively small percentage of total valve revenues. Development includes drilling new wells in areas that already have been explored. So, at $50 per barrel, there will be justification for this investment. The cost of operating existing wells is small. Thus, this production is unaffected.

The decline rate is the key factor in the rebound of prices. Averages of 10% to 15% per year have been cited for the industry. If no new wells were drilled, flow would drop by 20% or 30% within just two years. The decline rate for shale sources in the U.S. is being debated. The ability of conventional suppliers in the Middle East to raise production from existing wells also is in question.

It is likely that demand for oil will continue to rise; the lower oil prices and booming economies in Asia and the U.S. will contribute to that rise. Thus, imbalances in supply and demand and potential shortages will lead to the next round of oil price increases and investments in unconventional sources.

The pulp and paper, metals, and mining segments will benefit from lower oil prices. This will boost industrial capital spending and resultant water measurement and control expenditures in the U.S. and other heavily industrialized countries. 

Lastly, the lower energy cost will make more money available for pharmaceuticals and food. Many of those industries using water and wastewater instrumentation and controls will be growing at rates in the next five years that are greater than in the last five. 

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About the Author

Robert McIlvaine

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