Fast Forward to a Greener Future

• By Angela Neville
• Jan 01, 2007

So maybe the present isn’t everything we environmental professional were hoping it would be. Fortunately, however, the future already is heading this way and overall it’s looking a lot better. Our job is to give you a glimpse at what lays ahead in the environmental field this new year and beyond to help you put together your business strategies.

Of all the various sectors within the environmental industry, the water and wastewater treatment niche stands out because of its strong growth potential. Even the mainstream business press is taking notice.

In his Oct. 16, 2006 Barron's article “The Lure of Liquid Assets,” author Christopher C. Williams said, “Wall Street is pumped about water, and for good reason. Globally, the $365 billion business is burgeoning as counties spend billions to repair and build infrastructure to funnel clean water to people and industry.”

According to Williams, “Some experts think $1.5 trillion in capital spending could flow into the sector in the next five years, promising a steady stream of business for a host of companies, from pump makers to water utilities. The market, which encompasses residential and industrial water and wastewater treatment and services, is growing 4 percent to 6 percent a year in developed countries, and as much as 15 percent in emerging markets, estimates Goldman Sachs a global investment banking firm.”

Another bright sign for environmental professionals is that the air pollution control market is starting to soar for the first time in decades, according to Air Pollution Management, an online report published by the McIlvaine Company. On average, the world air pollution control industry lost money from 1980 to 2003. However, the market rebounded in 2004 when global profits were estimated by McIlvaine at $3.2 billion. McIlvaine now forecasts that profits in this sector will grow to $21 billion in 2015 with $3 billion generated from the supply of systems, $11 billion from the supply of products, and $7 billion from the supply of services. The primary profit engine will be the electric power industry, which will account for $13 billion of the profits. The biggest single market will be China, and the biggest product category will be scrubbers for power plants.

As has long been the case in the air pollution control industry, new environmental regulations could drive more revenue growth. For example, 23 states currently are pursuing their own programs to control mercury emissions from power plants, opting for stricter emissions limits or tighter compliance deadlines than federal rules, according to the National Association of Clean Air Agencies. The U.S. Environmental Protection Agency required states to submit plans by November outlining how they intend to comply with the Clean Air Mercury Rule. EPA says the rule will use emissions trading and reduce mercury emissions 50 percent by 2020.

Along the same lines, the solid waste management industry is projected to expand, albeit at a slower pace. For predictions about this sector, we turned to Dr. John H. Skinner, executive director and CEO of the Solid Waste Association of North America.

“Solid waste volumes generally track (but lag) the growth in the gross domestic product (GDP),” Skinner said in an interview with us in November. “In the coming year, GDP is projected to grow at about 3 percent, and solid waste volumes should follow at a slightly lower rate of 1 percent to 2 percent. Solid waste handling prices charged to commercial and residential accounts will be affected by several factors. Fuel costs are increasing at an annual rate of about 1.5 percent and these are usually passed through as fuel surcharges. Other Consumer Price Index related price increases have been in the range of 2 percent to 4 percent. If these trends continue, solid waste management prices could increase 3.5 percent to 5.5 percent. Combining these increases in volume and price would result in an average national increase in solid waste revenues in the range of 4.5 percent to 7.5 percent. This could vary significantly regionally due primarily to the regional differences in population growth and residential and commercial construction rates.”

Additionally, the hazardous waste remediation market is looking stronger. According to a technical market research report compiled during 2006 by BCC Research, the global market for hazardous waste remediation technologies was worth about $10.7 billion in 2005. The report predicted the market would rise to $11.4 billion by the end of 2006 and then hit $16.6 billion by 2011, at an average annual growth rate of 7.8 percent.

If you want to succeed in the future, you’ve got to work hard and be smart about seizing opportunities in the present. Hopefully, this peek at environmental market trends shows that the growing global movement toward greener practices will no doubt create more green (money, that is) for us environmental professionals in the coming years.

This article originally appeared in the 01/01/2007 issue of Environmental Protection.