You know the exercise: every year, futurologists of all kinds try to predict what will happen in the coming year.
Well, the critic is easy and the art difficult: that’s why we tried it for ourselves with my Water Show co-host, Björn Otto. (This is part of my deep dive on the fundamentals of Water!)
Here’s the result ⬇️ You’ll tell me next year how accurate those predictions were 😉
Table of contents
- Bet 1: The Forward Osmosis bubble will burst!
- Bet 2: The first large AI-Powered plant will be commissioned
- Bet 3: IFAT will not take place due to COVID
- Bet 4: We will see the rise of a Water Unicorn
- Bet 5: We will be down to 5 major European EPCs
- Bet 6: A new Vertical Giant will arise
- Bet 7: The Water Tariffs will dramatically increase
- Bet 8: Ballast Water Treatment will finally take off
- Bet 9: We will see a “Sludge Revolution”
- Bet 10: The SUEZ/VEOLIA merger will fail
Bet 1: The Forward Osmosis bubble will burst!
Despite the high market expectations and renewed investments, Bjöen doesn’t believe the technology has a future anymore!
Bet 2: The first large AI-Powered plant will be commissioned
That’s a topic we’ve been extensively covering on the podcast: digitization might be ready for it, technologically speaking. But how ready is the Water Sector, to let AI, Machine Learning, or even Modeling take the steering wheel?
That’s the challenge, and I’m betting, 2022 will see it happen, at least in one place.
Let me use some buzzwords. I’ve been discussing in the past how the roadmap to digitization has four levels. Level one: you have a digital version of your plant or water network, the famous digital twin. On level two, that digital twin is active, and you can run modeling or even artificial intelligence on it. Level three, it runs by itself and gives you some hints at operating your plant. My bet is that we will reach level four on at least one large wastewater treatment plant in 2022: the digital twin will run by itself and actually operate the plant. And I’m giving it a probability of 99%!
Bet 3: IFAT will not take place due to COVID
… or at least it will be postponed, and partially held digitally.
Bet 4: We will see the rise of a Water Unicorn
This year, EQT sold Innovyze to Autodesk for 1 billion dollars. Does it make it a unicorn? Not fully, as it is no longer privately owned, and its valuation did not exceed one billion dollars.
Yet, that clearly shows that, with rising valuations, the impossible may become possible. Hence I’m betting that 2022 will see a Water Sector Unicorn join the list of 925 currently existing ones, and I’m giving it a probability of 60%. Who will it be? Hmmm, that might come in a next bet.
Bet 5: We will be down to 5 major European EPCs
Concentration at work in the Water Industry. A surprising name in that list: Björn sees Grundfos becoming a real EPC in the next year. An additional M&A upcoming?
Bet 6: A new Vertical Giant will arise
There are different winning strategies when you play Monopoly. Yet, in the real world, those strategies follow some fashions.
For a while, the trend in the Water Sector has been on a combination of horizontal groups specializing in a certain section of the value chain, but across multiple industries, and of niche players specializing in a section and an industry.
Yet my bet is that next year we will see a new vertical giant go against this trend and go from the grassroots hardware, up to the most digital layer of services, through the entire Value Chain, in the purest 19th-century style – cloud aside. Chances? 70%.
Bet 7: The Water Tariffs will dramatically increase
Water Tariffs may well follow the trend on the Energy ones, which would mean dramatically taking off!
Bet 8: Ballast Water Treatment will finally take off
Let me start by high fiving the younger me, when I started at SUEZ a decade ago – God I’m Old. One of my first presentations was about Ballast Water Treatment, and let me tell you, it didn’t age well.
I was predicting a 53% compound annual growth rate for Ballast Water Treatment technologies, which would become by 2020, a 34 billion dollar annual market. Yet, I did not invent those numbers, which even downplayed the most optimistic previsions of market research companies.
Those same market specialists now predict that, what was supposed to massively take off in 2010, will actually do it in 2022. Hence this bet: Ballast Water Treatment is finally going to BOOOM next year. Probability? 1% again.
Bet 9: We will see a “Sludge Revolution”
If you can’t bring sludge to the fields anymore, what do you do with it? Björn has some ideas!
Bet 10: The SUEZ/VEOLIA merger will fail
It all started in July 2020, went into an epic battle, and theoretically ended the 12th of April 2021, with the announcement of their agreement: SUEZ and VEOLIA will merge. Or will they?
There’s still a lawsuit ongoing on the role of the French Presidency in the story, and the European Commission’s Competition Authority still has to give its green light – which is expected for next week. Yet, I’m betting that the merger will fail.
OK, I’m not totally nuts either, so I’m giving it a 1% probability. Still, tell me, what is Veolia winning in that story?
So what do you think? Totally nuts or some truth in these 10 bets for the Water Industry in 2022?
Have a look here, for the video version of this analysis!