Desalination and Reuse: Goals Achieved and New Challenges

The increase in global water demand is expected to continue at a similar rate until 2050, 20 to 30% higher than the current level of water use. Non-conventional water sources, such as desalination and reuse, are reliable and sustainable alternatives for addressing this need and combating climate change.

Although I have written about desalination and reuse many times, today I would like go over some of the milestones achieved with these technologies and update the current trends/markets. It is always interesting to stay up to date and know the data in order to continue offering interesting information for the water sector. To do this, I've used the most recent DesalData report, which is always a source of reliable data and information.

To start, the desalination market has grown extremely rapidly over the last decade, and today there are more than 21,000 desalination plants worldwide. With a CAPEX of 15.24 billion dollars and a contracted capacity of 5.42 million cubic meters/day in 2020, desalination is a mature technology that produces very high-quality drinking water in areas where the resource is very scarce.

However, critics of desalination have always criticized its high energy costs, but the truth is that this factor has evolved enormously since the 1990s. At the beginning of the 1990s, Pelton turbines were introduced into desalination as the standard energy recovery device. They reduced energy consumption from 8 and 10 kWh/m3 to levels of 5-6 kWh/m3. Pelton turbines were followed by the next generation of recovery devices, initially called “positive displacement units” and today known as “isobaric devices” or “pressure exchangers”. Pressure exchangers use up to 95% of the energy that remains in the brine, although 1% is lost to facilitate the discharge of the depressurized brine. At the same time, in order to achieve greater energy savings, membrane manufacturers are building membranes that can operate at lower pressure without reducing, and in some cases even increasing production, although their enormous evolution in recent years makes it difficult to improve them. The limit of 3 kWh/m3 of specific consumption in the reverse osmosis phase can be considered to be the goal that is sought in the improvement of the current systems, and the main plants are very close to achieving it. There are already a large number of plants that have been designed to work in the 3.2 kWh/m3 range.

In addition, renewable energy sources such as solar, wind, geothermal and nuclear energy have proven to be viable competitive solutions. Proven technologies exist at highly competitive prices at the same level as gas or oil rates, making desalination a safe, ecological and sustainable source of water.

Lastly, in recent years the membrane-cleaning problem has been solved, which has made it possible to build enormous plants. These economies of scale and the maturity of the technology at competitive prices are the factors that have already made desalination a commodity and a real solution for the safe supply of drinking water. The following are some of the most recent contract awards in the Middle East that demonstrate what I am talking about:

• September 2020: Hassyan (United Arab Emirates) - 545,520 m3/d - 0.27762 USD/m3 (Utico)
• September 2020: Jubail 3 A (Saudi Arabia) - 600,000 m3/d - 0.413 USD/m3 (ACWA/Gulf Investment/Al Bawani)
• February 2020: Yanbu 4 (Saudi Arabia) - 450,000 m3/d - 0.465 USD/m3 (Engie/Mowah)
• May 2019: Shuqaiq 3 (Saudi Arabia) - 450,000 m3/d - 0.52 USD/m3 (Marubeni/Almar Water Solutions)
• March 2019: Rabigh 3 (Saudi Arabia) - 600,000 m3/d - 0.53 USD/m3 (ACWA Power)

However, despite the improvement in recent years, reuse has progressed more slowly, mainly due to lack of regulation. Reuse technology has already been launched and tested in countries such as the United States (mainly California), Singapore and Israel, and has been perfected, reaching optimum quality standards, but the most interesting aspect is that it can be adapted to the different uses for which it is intended. Different treatments can be established depending on whether the water will be used for agriculture, industry, city or aquifer recharging.

In terms of regulation, the matter is already on the table, for example, in Europe, where the Commission approved the new Water Reuse Regulation in May 2020. This new law for the first time defines minimum requirements at the European level for reclaimed water to be used for agricultural purposes safely, protecting people and the environment, ensuring wider use of treated wastewater in order to preserve freshwater bodies and groundwater.

The treatment of wastewater with qualities suitable for different uses, both direct and indirect, generates many benefits in the short, medium and long term, not only for citizens or industry, which has a real need for water, but also for the environment. And with these new advances in regulation, the aim is for the stagnant level of 4% of water reused worldwide to grow by leaps and bounds.

Now let's look at both markets separately to see the situation in the present as well as in the future.

Desalination

Market overview

2019 was the year with the highest number of seawater desalination projects contracted due to the awarding of several mega-contracts, and the market is expected to remain strong despite COVID-19. The desalination market is currently dominated by a small number of projects in the Gulf and the Middle East, with capacities of more than 300,000 m3/day. This indicates that the water sector has remained resilient despite the circumstances, although it is true that the industrial market has been affected to a greater extent. This boom in mega-projects in the Gulf will be the defining trend in the desalination market over the next five years.

The projects in Saudi Arabia and the United Arab Emirates account for almost half of the total new seawater desalination awards planned for the 2020-2025 period. These projects are notable for their size and price, making them the cheapest projects yet this century: the record of 0.53 dollars/m3 set in Ashkelon (Israel) in 2003 was broken several times in 2019-20, with a new record set by IDE Technologies in Soreq 2 (Israel), which was awarded with a rate of 0.405 dollars/m3. Higher recovery rates, economies of scale and cheaper energy have been key factors in these reductions.

Main desalination markets

In addition to mega-projects in Israel and the Gulf, there are significant project opportunities in the Middle East in general, in India, China and the United States. Desalination in these regions has not been developed on such a large scale, and projects rarely exceed 150,000 m3/day. The cost of desalination is also higher, due to a combination of different procurement practices and energy prices.

Today, India is home to some of the world's most ambitious desalination programs outside the Middle East. Also, Egypt's efforts to reduce its dependence on the Nile will depend largely on seawater desalination for new urban and tourist developments, with foreign contractors facing intense local competition for the projects.

The OCP Group, Morocco's national phosphate extraction and production company, is trying to eliminate its groundwater extraction by focusing entirely on desalination and water reuse. Meanwhile, political uncertainty in Algeria has put the brakes on two 300,000 m3/d projects originally planned to be awarded in 2019.

Lastly, in the United States, there is hope that seawater desalination will progress in California and Texas, and that the long history of permit delays and technical issues may now be left behind in this market. Brackish water desalination and water reuse will also be keys to the region's long-term water security

Reuse

Increasing scarcity of resources is driving reuse

Water scarcity, population growth and demand for industrial water are driving rapid growth in wastewater reuse. In contrast to the more cyclical desalination market, the movers of reuse expect that the market will remain strong for the next five years and beyond.

• Water scarcity is the biggest driver of water reuse. More variable rainfall and longer, hotter droughts make reuse a vital source of additional water. In the Middle East and southwest United States, water scarcity alone is enough to stimulate greater reuse.
• Regulations governing water reuse are becoming increasingly developed for both direct and indirect reuse. These regulations are particularly stringent in China, where a combination of direct reuse requirements for municipalities, along with restrictions on both groundwater extraction and wastewater discharge for industry, are driving rapid adoption.
• The United States is the largest market for reuse in terms of installed capacity (31%), followed closely by China (30%), which has made a big push for this technology in the last 10 years.

Industrial reuse

In the last decade, global water reuse capacity has shifted from agricultural applications in the Americas and the Middle East to industrial applications in the Asia-Pacific region. Industrial water users generally face more restrictions and stricter regulations than municipal users, and usually do not need to overcome the same political obstacles as municipal reuse.

• The need to treat effluent and obtain a high-quality product is increasing the market share of advanced water treatment technologies such as membrane bioreactors (MBR), micro/ultrafiltration (MF/UF) and reverse osmosis (RO). The tertiary sector is the largest reuse segment, while triple-barrier reuse (including MBR, UF/MF and RO) is growing the fastest.
• Regulatory pressure on industrial end-users is particularly severe in China, India and Taiwan, and strict limitations on wastewater discharge are becoming increasingly common. Large industrial parks, which are typical in these countries, are well adapted to the development of large-scale, centralized water reuse facilities. Direct reuse of industrial water is the most common, but industrial reuse of municipal wastewater is also gaining ground.
• A growing number of large companies are committing to increasing water reuse rates in order to meet sustainability goals. This will drive strong growth in technologies that can provide improved wastewater recovery, particularly high recovery reverse osmosis systems.

Agricultural and municipal reuse

Beyond industry, irrigation, municipal reuse and environmental improvement account for most of the remaining installed capacity until 2025.

• Agricultural and landscape irrigation is the largest consumer of reused wastewater outside of Asia. Improvements in wastewater treatment infrastructure in the Middle East and new reuse capacity in Egypt are the main opportunities for reuse projects. The greatest capacity for reuse for agriculture is currently in the Middle East and the United States.
•  Indirect drinking water reuse is rapidly gaining ground, especially in the southwestern United States, where groundwater recharging and aquifer storage and recovery (ASR) are becoming more widely popular for long-term water security. Direct drinking reuse is still limited to a very small number of cases: two plants in Goreangab and Gammams in Windhoek, Namibia are still the only examples of long-term and large-scale direct drinking reuse.
• 'Environmental improvement' - the discharging of highly treated wastewater with the explicit aim of improving the quality of natural waterways - has several large-scale projects in China and India. These projects can blur the line between reuse and standard wastewater treatment.

Producing non-conventional renewable water at an increasingly competitive price and without greenhouse gas emissions is a reality. Investing in innovative water projects, especially in water-scarce regions, is vital to secure water and food supplies, economic development and the natural environment.

Source: GWI Market Focus Deck: Desalination & Reuse Markets, July 2020