Pricing will be key consideration for municipalities when choosing external vendors, finds Frost & Sullivan's Environment & Water Team
SANTA CLARA, California, April 19, 2017 /PRNewswire/ -- Intensifying environmental regulations, need for infrastructure investment and lack of capital are steering the North American municipal water and wastewater market toward outsourcing. Larger outsourcing partners stand to reap significant benefits from handling challenging projects that address multiple needs. Emerging players will do better in targeting select areas and providing superior quality services.
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North American Municipal Water and Wastewater Outsourcing Market, Forecast to 2021, new analysis from Frost & Sullivan's Environment & Water Growth Partnership Service program, finds that increasing private sector penetration in Canada and the United States will support a compound annual growth rate of 2.3 percent from 2015 and 2022 to push revenues to $6.08 billion.
"The municipal water market is becoming increasingly sophisticated in its approach to business models and partners. The broader regional trend toward centralization and larger treatment plants stresses the need for investment and private organization involvement in managing complex process expansion," said Frost & Sullivan Energy & Environment Industry Analyst Seth Cutler.
The absence of qualified in-house personnel and difficulty in obtaining finance at low interest levels make outsourcing a smarter alternative. However, pricing is a major consideration for many municipalities. Other potential barriers to outsourcing include:
"Offering a competitive price is a key factor for many outsourced contractors in this market. Contracting abilities, access to technology, finance, experience in the sectors and support capabilities are other competitive factors players use to differentiate their offerings," noted Cutler. "Players in the water sectors include American Water, Severn Trent Services, SUEZ, and Veolia. The construction sector is made up of participants such as CH2M Hill and EPCOR. Other active companies like AECOM, GE, Alliance Water, and Woodard & Curran are either technology specialists or have a regional focus.
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North American Municipal Water and Wastewater Outsourcing Market, Forecast to 2021
Corporate Communications – North America