china membrane bioreactor (mbr) market outlook- ambitious water reuse targets boosting membrane...

China Membrane Bioreactor (MBR) Market Outlook - Ambitious Water Reuse Targets Boosting

Membrane Industry

Jennie Peng, Consulting Analyst

Environment & Building TechnologiesEnvironment & Building Technologies

August 31st 2011

Today’s Presenter: Jennie Peng

Jennie Peng is Consulting Analyst with Frost & Sullivan GIC group specialised in Environmental practice. She mainly focuses on monitoring and analyzing emerging trends, technologies and market behavior in the water and wastewater management, waste management, new energy, air pollution control, and environmental health and safety industries in China.

What she brings to the Team

� Highly fluent verbal and literal capability in both English and Chinese

� Varied experience across industry segments and solid experience in environmental industry

� Sound understanding of functions such as production, sales & marketing, and project managements

� Ability to understand client requirements and deliver solutions

Industry experience

� Extensive expertise in environmental industry.

2

� Worked with several leading firms: such as Dow, GE, Siemens, Befesa, Severn Trent Services, etc.

� Consulting and research projects including China Water and Wastewater Treatment Market, China Membrane Bioreactor Market, China Desalination Market, Opportunities in Mega Cities Water Infrastructure Development, China Sludge Treatment and Disposal Market, etc.

• Prior to joining Frost & Sullivan, she was working as a Marketing Engineer for Hyflux Ltd in Singapore, where she was involved in several market research projects. Jennie also has experience with the same company working as a Global Sales Coordinator, as well as a Membrane Product Branding Specialist.

Education

� MSc. Environmental Science & Engineering, Stanford University (US) and Nanyang Technological University (NTU) under Singapore Stanford Partnership program, Singapore

� B.Eng. in Environmental Engineering, Zhejiang University, Hangzhou, China

Jennie PengConsulting Analyst

Frost & SullivanBeijing, China

Today’s Agenda

China MBR Market

Government strategies and plans

Overview of China water industry

Key market forces

3

Outlook: $1 Billion

Industry by 2017

Market forecast and perspectives

Mega trends and Industry convergence implications

Key end-user analysis

Technology Analysis

Overview of China Water Industry

Heilongjiang

LiaoningInner Mongolia

Ningxia HebeiShanxi

Tianjin

BeijingXinjiang

Jilin

Water Distribution (China), 2010 Water Distribution (China), 2010

0.0

200.0

400.0

600.0

800.0

1000.0

1200.0

Wate

r usage p

er

capita

(m

3/y

ear)

Seven regions Most water-unstinted province

Municipalities

Per capita water usage (China), 2010 Per capita water usage (China), 2010

500 m3/yr extreme scarce level by UN

4

Taiwan

Sichuan

Yunnan Guangxi Guangdong

Fujian

Shandong

Hubei

HunanJiangxi

Hainan

NingxiaQinghai

Shanxi

Henan

Anhui

Zhejiang

JiangsuShaanxi

Guizhou

Shanghai

Chongqing

Tibet

Total Water Distribution (Billion tons)

≥396.5 317.4-396.5 159.2-317.4 ≤159.2

0.0

0

50

100

150

200

250

Total Wastewater Generation

Treated Wastewater Reused Wastewater

Municipal Industrial

Volu

me (

mill

ion m

3/d

ay)

Only 8.5% reuse rate in 2010

Source: Year Book of China Statistics 2010, Ministry of Water Resources

Government Strategies and Plans

2010 Plans on Increasing Wastewater Reclamation and Reuse 2015

Overall Municipal Wastewater Reuse and Recycling Rate

Water Consumption per 10,000 RMB Industrial Value-added

Wastewater Reclamation Rate for Northern Cities

5

Central Government

Budget Funds,

$0.37 Bn

Local Government

Budget Fund,

$0.74 BnPrivate Investment,

$2.56 Bn

Plan of Investment for Wastewater Reclamation and Reuse (China), 2011-2015 Plan of Investment for Wastewater Reclamation and Reuse (China), 2011-2015

Source: 12th five year plan, Frost & Sullivan

MBR Market Evolution in China

YearMunicipal

(‘000 m3/day)

Industrial(‘000

m3/day)

Ratio of Municipal

Installation Capacity

Ratio of Industrial Installatio

n Capacity

2005 190.0 75.0 71.7% 28.3%

MBR Market: Historical Installation Capacities (China), 2005-2009

500.0

600.0

700.0

800.0

900.0

Ins

tall

ati

on

Ca

pa

cit

y (

‘00

0 m

3/d

ay)


6

2006 189.9 81.4 70.0% 30.0%

2007 200.0 88.6 69.3% 30.7%

2008 519.2 23.5 95.7% 4.3%

2009 700.2 142.7 83.1% 16.9%

Source: Frost & Sullivan Note: All figures are rounded; the base year is 2010.'

0.0

100.0

200.0

300.0

400.0

500.0

2005 2006 2007 2008 2009In

sta

lla

tio

n C

ap

ac

ity (

‘00

0 m

3/d

ay)

Year

Key Market Challenges

Challenges 1-2 Years 3-4 Years 5-6 Years

Robustness of membrane material and challenge of fouling. High High High

Lack of awareness among end-users of the tangible benefits of MBR systems

High High Medium

MBR Market: Impact of Top Six Industry Challenges (China), 2011-2017

7

Relatively low tariff for reclaimed wastewater High High Medium

High market concentration High High-Medium Medium

Lack of specific governmental subsidies to compensate the production of reclaimed water for self-supplying applications

High High-Medium Medium

Source: Frost & Sullivan

Revenue Forecast and Perspectives

877.6

1,350.8

9697

8000

10000

12000

1,000

1,200

1,400

1,600

Insta

llati

on

Cap

acit

y (

‘1000 m

3/d

ay)

Re

ve

nu

e (

$ m

illi

on

)

MBR Market Revenue and Installation Capacity Forecast (China), 2011-2017

MBR Market Revenue and Installation Capacity Forecast (China), 2011-2017

Market Revenue Share by Sectors (China), 2010 Market Revenue Share by Sectors (China), 2010

75%

25%

Municipal

Industrial

8

59.2

228.1

289

1006

5019

0

2000

4000

6000

0

200

400

600

800

2007 2010 2015 2017

Insta

llati

on

Cap

acit

y (

‘1000 m

3/d

ay)

Revenue Installation Capacity ('000 m3/day)

Re

ve

nu

e (

$ m

illi

on

)

Market Revenue Share by Membrane Types (China), 2010

Market Revenue Share by Membrane Types (China), 2010

Year


94%

6%

Hollow fiber

Flatsheet

Technology Analysis

China MBR Market: Target of Pollutants Reduction for 12th five year plan (China), 2011-2015

WWTP Upgrading &

Nutrient RemovalTargets

Existing plant meeting Level II discharging standard to upgrade to meet Level I Grade B StandardExisting plant meeting Level II discharging standard to upgrade to meet Level I Grade B Standard

Part of the existing plants need to be upgraded to meet Level I Grade A StandardPart of the existing plants need to be upgraded to meet Level I Grade A Standard

60% of the municipal wastewater treatment plants are to add denitrification and dephosphorous functions60% of the municipal wastewater treatment plants are to add denitrification and dephosphorous functions

9

Add Carbon Source

Add Dephosphorous chemcial

MBR Filtration Tank Denitrificationtank

Membrane filtration

COD - ++ + +

AmmoniaNitrogen

++

Total Nitrogen +++ ++ + ++ +

Total Phosphorous

++ + + + +

China MBR Market: Influence of 12th five year plan on treatment effectiveness for different wastewater reclamation technologies


Key End-Users Analysis

Market Share by Industry Segmentation (China), 2010

Industrial Application Market Share in 2010MBR Growth Potential

(2011-2017)

Power

Petroche-mical

Steel & Metal

Textile &

Market Share by sectors (China), 2010

28.60%


10


Oil Field

Others such as Pulp & Paper, Electronics, Oil

Field, Pharmaceuticals, etc

Leachate

Textile & Dye

Food & Beverage

Pharmaceuticals

Oil Field

71.40%

Conclusion/Key Take-Aways

Megatrend Degree of Impact Impact Timing

The BOT business mode to dominate the MBR market

8 1-2 years

11

Reclaimed wastewater will be distributed under comprehensive network system

7 3+ years

Automatic and integrated module design will enable the trouble-free operation

5-6 3+years


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For Additional Information

Chiara Carella

Head of Corporate Communications

Europe, Israel, Africa

+44 (0) 207 343 8314

[email protected]

Jennie Peng

Consulting Analyst

Environment & Building Technologies

(86) 10-65989600-331

[email protected]

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Fredrick Royan

Research Director

Global Environment (Water) Markets

+44 (0) 20 7343 8353

[email protected]

Andrew Thorndyke

Sales Director

Environment & Building Technologies

+44 (0) 186 539 8645

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