This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 4/23/2018

Overview

The United Arab Emirates (U.A.E.) faces several water management challenges, including the scarcity of groundwater reserves, high salinity levels in existing groundwater, the high cost of producing drinking water, limited re-use of water, and limited collection and treatment of wastewater outside the urban areas. With water demand growing annually, the country’s water infrastructure is under significant pressure. There is an increasing need to invest in infrastructure and water efficiency technology to meet the future demand and to avoid a shortfall. However, budget cuts, as a result of falling government revenues due to low oil prices, have affected existing projects resulting in calls for proposals and more innovation.  The government is managing the demand by investing in water efficient technology, energy efficient seawater desalination and in education.  To address the high cost to the government has reduced subsidies for water and power since January 2015 and increased tariffs in 2016 and 2017.

Published by Environment Agency Abu Dhabi (EAD), Environment 2030 forecasts that both fresh and brackish underground water from U.A.E. aquifer systems will be exhausted within fifty-five years if mitigation measures are not taken.  The government has addressed this issue, by using waste treated water to increase the efficiency of water use for irrigation. In 2017, the Abu Dhabi Municipality reported that 76 percent of the water use in landscapes in treated water and plans to have all fresh water replace by treated sewage effluent by the year 2030.

The U.A.E. has one of the highest per capita water consumption rates in the world (550 liters per day). As a result, the government is working to reduce demand by educating youth, reducing cost by eliminating subsidies, storing water in aquifers, regulating groundwater extraction, and investing in new energy efficient sea water desalination. As the main source of drinking water is from desalinization, the capacity is expected to increase steadily over the next few years, contributing 96.5 percent of all water produced by 2019.  By 2019, total production is expected to reach 2.19 bn cubic meters of water (up 205 mn on 2015 production projections). Currently, substantially all of the drinking water used in the Emirate is produced through thermal desalination, requiring the combustion of fossil fuel.  Measures to find alternative energy-efficient ways to produce drinking water are being explored.

In 2015, Masdar awarded contracts to four water technology companies to build four small-scale desalination plants, designed to test solar energy-desalination processes through reverse-osmosis: Spain’s Abengoa and Degrémont, France’s Veolia and US Trevi Systems.  A fifth plant was launched in October 2016, run by the French engineering company Mascara, using forward osmosis.  The combined daily output of all five pilot plants in Ghantoot is 1,500 cubic meters. If such desalination processes succeed in reducing energy consumption, this would lead to reduction of costs, a smaller carbon footprint, and the ability to power plants with renewable energy. 

In the wastewater sector, one of the key projects undertaken by Abu Dhabi’s Sewerage and Services Company (ADSSC), a wholly owned subsidiary of the Abu Dhabi Government established in 2005, is the Strategic Tunnel Enhancement Program (STEP) to collect and treat wastewater discharged from residential, commercial and industrial buildings in Abu Dhabi to increase the capacity for wastewater collection and treatment.  Completion of the next phase of STEP will expand its capacity to handle 1.7 million cubic meters of waste water per day by 2030.

According to an expert on water resources at EAD, wastewater is treated at the tertiary level and approximately 45 percent is re-used for non-potable purposes while the remaining 55 percent of wastewater is being discharged in the environment.  ADSSC sources explained that additional investment is needed to connect the recovered water treatment plant in to the system and the potential irrigation sites for reuse, thereby reducing the quantity of desalinated water used and reducing the impact of discharges to the Arabian Gulf and desert receiving areas.

Regulatory Environment

The water sector in the U.A.E. is fully government-owned, regulated by a number of agencies, including ADWEA, ADSSC, EAD, and other agricultural organizations.  Contracts are granted by both federal and Emirate government, with a rigid bidding process and price as the ultimate determinant. The U.A.E. has a distinctive system in place. Companies must be familiar with the business culture and the singular way of negotiating contracts.  In the past, the government has demonstrated high level of support of private sector involvement in water sector development.

Commercial environment

Pressure on meeting increasing demand makes providing clean water a priority for the U.A.E.  The country has seen heavy investment from both the public and private sector. A large number of new projects are in the pipeline despite the financial pressure from the oil crisis. Opportunity exists for technology and innovations that can make drinking water production more efficient, solutions for storage, and wastewater treatment and reuse.  The wastewater treatment and sanitation sectors are also in need of large investment. The integration of water and sewage networks offers potential synergies for infrastructure companies in the sector over the long term.

Sub-Sector Best Prospects

Ground Water: Investment in groundwater infrastructure needs to be minimized because the aquifers are deteriorated.  However, the Abu Dhabi government is interested in enhancing desalination at the farm level for cropping through hydroponic or soilless systems according to an EAD expert in water resources.

Drinking Water: The country is looking at new desalination technologies (solar-powered and nuclear) to produce drinking water.  It is also interested in harvesting brine water from the desalination units to produce salt.

Waste Water: The government is looking at new technologies to recycle wastewater and improve wastewater treatment, as wastewater treatment facilities are far cheaper to construct and maintain than desalination plants. They are also more environmentally friendly, as less water needs to be extracted from the surrounding environs. Treated wastewater caters to much of the industrial and agricultural requirements.  This would free up freshwater and desalinated water supplies for domestic consumers.

Opportunities

Opportunities lie in technology and innovations that can make drinking water production more efficient, solutions for storage, and wastewater treatment and reuse:
Companies that build water plants and desalination plants.

Firms that offer solar-powered, reverse-osmosis desalination technologies and other cutting-edge technologies to produce drinking water.

Companies that offer the technology to separate black water networks from grey water networks and to treat the black water at the treatment plant level and the grey water at the district level.

Companies with new and efficient technologies to recycle wastewater and improve water treatment.

Water/Wastewater equipment opportunities to supply membranes, pipes and components to build tertiary wastewater treatment plants or water desalination plants.

Water monitoring equipment such as auto samplers and flow meters, as well as more water efficient faucets, flushing toilets and pipes with low leakage.  High competition is anticipated in terms of pricing and offers.

Technologies to enhance and capture rainfall, store it and pump it underground to replenish the groundwater and use it as needed.

Ground Water: International consulting engineering firms can detect engineering problems such as the problem faced with residuals and design evaporation ponds to deal with the brine solution.

Trade Shows & Exhibitions
Water Energy Technology Environment Exhibition (WETEX)
Date: October 23-25, 2017
Venue: Dubai International Convention and Exhibition Center

Web Resources

WETEX

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United Arab Emirates Water and Wastewater Trade Development and Promotion