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Water Utility Services Market : Latest Trends, Demand and Analysis

The world population is increasing at the annual average growth rate of approximately 1.1%. This growing population is has created for efficiency in water market. The water market includes water utilities, waste water management, and sanitation management through water, among others. The water industry is estimated to grow by 4-5% in yearly basis and water utilities account near about 50% of this industry. The United Nation’s Millennium Development Goals (MDGs), has set on a target of reducing the number of people without having sustainable access to drinking water and sanitation. This target is shared among many countries worldwide, especially developing countries where the number ofpeople meeting the UN’s criteria is high. This factors have led the increased investment in the water utilities market.

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The water utility industry comprise of the companies offering safe and suitable distribution of water and services such as wastewater treatment. Mostly the companies providing this services are local government body. However the recent trends show the involvement of private companies in water market. The water utilities all over the world function in different arrangement such as integrated water system and utilities separated by functions, among others. The integrated systems consist of a single entity handling the water supply, sanitation system and wastewater treatment. Conversely, in separated by function type arrangements, the different types of utilities will be handled by different organization.

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The local authority has the maximum share in the water utilities sector. However the water utilities all over the world are facing multiple challenges. The change in regulatory models for Australia and UK, the water distribution network development in Middle East and Asia, and the aging infrastructures issues, such as in the US are part of the challenges faced by water industry. To solve these problems, the industry needs huge investment to develop operational efficiency, appropriate customer services, flexible supply, and deployment of innovative smart technologies. On addition to this, the water market is highly regulated and the policies and demand may change rapidly. The customer today is highly conscious about quality of the water and the efficiency of the related services. This creates additional burden on the government facing economic crisis such as in European region and in developing countries of Africa and Asia. However, these drivers have created huge investment opportunity for private companies. Many private companies have taken over the water utilities network in countries such as the France, Italy, Czech Republic and UK among the others. The investment in water utilities vary according to the region as the water distribution systems and demands varies from country to country.

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The local governments in many countries are selling their water utilities to the private companies to raise money for other responsibilities. This has created opportunities in countries such as US. The companies in this sector are following the policy of merger and acquisitions or entering the non-regulated market to increase their scope. The need for modernization and rehabilitation projects has created the demand for totex approach for investment. In the totex approach, investments are decided on the basis of cumulative consideration of capital and operational expenditures. The stress on expansion and increasing efficiency has also created a booming market for related services to water utilities.

The European region is considered to be one of the most efficient service provider for water utilities. The private sector has already major share in Europe’s water industry. The US market facing the need of intensive refurbishment is another developing market for water utilities’ companies. Asia facing the lack of infrastructure and technological development, will create huge investment opportunities in water industry market. The Middle East and Africa are the other attractive markets as they have water supply shortage. The smart technology application and water and waste management are among the water utilities solutions estimated to have highest investment share in the forecast period.

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