The smart water management market was valued at USD 7.14 billion in 2019, and it is expected to reach USD 13.81 billion by 2025, registering a CAGR of 12.31% during the forecast period. More than two-third of the world's population will be living in water-scarce areas by 2025, according to Xylem. By 2050, the demand for water is expected to increase by 55%, compared to the 2015 level, due to contamination, which leads to the destruction of water resources by humans.
The worldwide demand for water from the growing population, increasing urbanization, and the cost implications of maintaining aging infrastructure are among the major factors driving the growth of the smart water management market.
Similarly, with the proliferation of IoT, smart cities across various regions are also expected to promote the growth of the market studied. Technological advancements in smart meters and their integration with communication solutions (SCADA, GIS, etc.) have transformed water management in addressing the challenges faced by water utilities, residents, and industries, in terms of erroneous billing and water management.
Owing to the global demand, the need to address the operational issues of water management becomes crucial. Consequently, the adoption of smart water management technologies is expected to gain traction. The smart water management ecosystem consists of sensors, smart meters, communication infrastructure, and supporting software to enable two-way communication, thus, allowing users to gather actionable information and make informed decisions about optimized water distribution and usage.
- Whereas, the market comprises technology giants, like IBM, Schneider Electric, Hitachi Ltd, Utility Systems, and SUEZ Group, who provide smart water management solutions with advanced cloud-based monitoring technologies, smart meter manufacturers (Honeywell, Sensus, etc.), and software providers, like Esri and i20Water Solutions.
Key Market Trends
Residential Vertical to Record a Huge Penetration
- Residential usage of water accounts for a large portion of water consumption, globally, as water is considered to be one of the luxuries that need to be conserved efficiently. Therefore, technology also plays a vital role in making people liable for misuse of water.
- Consumers are upgrading their residences by adopting smart water management software and hardware. This adoption rate is rapidly proliferating, as software and hardware are becoming cheaper and affordable.
- For instance, WEGoT, a utility solution provider, provides sensor-based Internet of Things (IoT) devices and a software platform, VenAqua, which helps in reducing the demand for water by more than 50%, especially in residential buildings, by tracking real-time flow. The granular data collected from various installations across residential buildings is analyzed, and the insights are shared with the end-users on a mobile app.
- Digitization, along with the adoption of connected technologies, is impacting all applications of smart water management solutions, by revolutionizing the way smart water management systems interact with the surroundings in the residential sector.
Asia Pacific to Record the Fastest Growth Rate
- The Asia-Pacific region is home to more than 2.1 billion urban residents, with over two-third estimated to be living in cities by 2050. The region comprises countries with substantial non-revenue water (NRW) losses, like India (with almost 60% of revenue losses from the total water distributed) and Singapore, among others. Such figures signify the need for water management and indicate the potential for market growth in the region.
- The rising number of smart cities in the region is expected to create substantial business opportunities for the smart water management solution providers. Accounting for about half a million dollars, India is planning to build over 100 smart cities by 2022, which is expected to impact the total population of almost 1 billion. Also, Singapore spent over USD 1 billion in smart city initiatives in FY 2019. Such smart city initiatives in the region are expected to provide a huge scope for the adoption of advanced metering infrastructure.
- Significant initiatives, to develop smart water systems, are evident in the Asian countries, like Malaysia, Vietnam, and Thailand, among others, indicating the scope for the growth of the market. Japan, which has relatively lower NRW (US-24%), invests in water management infrastructure. Japan, with the aid of its Japan Water Research Center (JWRC), plans to achieve a 100% smart water meter rollout by 2025.
- Countries, such as India, are witnessing increased investments in the start-ups that are operating in the market. In October 2019, WEGoT, an IoT-based start-up, announced that it received an investment of USD 2 million in seed funding. The company offers integrated water management solutions in real-time to prevent and address the water crisis.
The smart water management market is fragmented due to the presence of a large number of companies. Some of the major companies include IBM, GE, Siemens, among others. Some key recent developments in the market include:
- September 2019 - IBM applied big data technology to improve water security in northern Kenya. IBM Research-Africa developed a cloud-hosted water management platform that connects a network of sensors for monitoring water levels and groundwater extraction rates in boreholes.
- September 2019 - Siemens and Grundfos signed a digital partnership framework for the strategic cooperation between the two companies. The new partnership focuses on the complementary products and solutions provided by both parties in three main areas: water and wastewater applications, industrial automation, and building technology.
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