Decentralized Water Treatment Market

Market Overview

The global decentralized water treatment market size was valued at USD 13.92 billion in 2022. It is estimated to reach USD 42 billion by 2031, growing at a CAGR of 12% during the forecast period (2023–2031).

Decentralized water and wastewater treatment systems help in providing the flexibility and efficiency required to deal with global water challenges. Decentralized treatment is setting water or wastewater treatment at the site of demand, supply, or preferably both. Decentralized wastewater treatment can also be defined as a method for wastewater collection, treatment, dispersal, and reuse for individual homes, businesses, groups of homes or businesses, and entire communities. Site-specific conditions are assessed to determine the best treatment system for each location. Decentralized water treatment systems can be quickly shipped to the requisite location.

These programs can be run as independent facilities or in conjunction with centralized sewage treatment programs. They provide a range of treatment options, from simple passive treatment utilizing soil dispersion, more commonly known as onsite systems or septic tanks, to more complex mechanized techniques like advanced treatment units that gather and treat waste from multiple buildings before discharging it into the soil or surface waters. It's an adaptable, sustainable alternative to huge treatment plants that necessitate a lot of expensive delivery and supply infrastructure. This type of system is preferred for almost all industries and residential complexes.

Highlights

• Wastewater treatment dominates the application segment
• Point of use (POU) dominates the system segment
• Municipal dominates the end-user segment
• The Middle East and Africa is the highest shareholder in the global market

Market Dynamics

Global Decentralized Water Treatment Market Drivers

Increasing Population and Rapid Urbanization 

Urbanization means an increase in the population in urban areas. More than 50% of the global population lives in urban areas, generating over 80% of the global domestic product (GDP). The concern for water pollution has grown due to the economy's rapid growth and the acceleration of urbanization and industrialization. In addition, water quality is significantly impacted by urban population growth. Decentralized water treatment systems are also anticipated to be in demand due to the expanding number of industries that emit emissions. As a result, there is expected to be an increase in demand for decentralized water treatment as urbanization and consumer awareness rise.

Increasing Awareness of the Benefits of Clean Water

Clean water has several benefits, such as it provides nutrition, preventing diseases, being needed for agriculture, and many others. Water is an essential human requirement. The United Nations contemplates universal access to clean water as a fundamental human right and a necessary step toward enhancing living standards worldwide. Various national agencies and the World Health Organization (WHO) have drinking water quality standards that specify acceptable chemical, radiological, and microbial drinking water characteristics.

Additionally, excessive amounts of chemicals or microbes derived from animal and human wastes, industrial chemicals, agricultural runoff, and natural pollutants make some water unsafe and cause water-associated illnesses. Therefore, this generates a requirement for decentralized water treatment systems for areas not covered by a centralized water treatment network to resolve these issues, thereby driving market growth.

Global Decentralized Water Treatment Market Restraint

Shortage of Skilled Workers

A decentralized water treatment system signifies crucial infrastructure, and decentralized workers are vital in offering wastewater treatment and removal facilities to communities and protecting the environment. But the availability of skilled personnel to operate, maintain, and manage the plant is often a restricting factor. In addition, workers potentially entering the decentralized water treatment sector usually need more exposure to decentralized skills and knowledge. The decentralized water treatment industry needs more exposure across various occupations and job clusters. Prospective recruits usually need more skills and knowledge about decentralized approaches, systems, and principles. Therefore, the need for more skilled workers challenges a market.

Global Decentralized Water Treatment Market Opportunities

Increasing Adoption of Decentralized Water Treatment in Developing Economies

Developing countries are burdened with diverse problems, and wastewater management is gradually becoming a priority problem. In developing economies, wastewater management is aggravated by inadequate management, accelerating urbanization, and the execution of advanced treatment technologies that are very well centralized. Centralized wastewater management systems are peppered with anomalies that demand a standard shift from centralized to decentralized water treatment systems.

Furthermore, centralized wastewater treatment systems are expensive to operate and construct, mainly in areas with low population densities and dispersed households. Developing countries need more funding to build centralized facilities and the technical expertise to operate and manage them. Therefore, the decentralized system is not only a long-term solution for small communities but is cost-effective and more reliable. This provides more significant opportunities for the market.

Regional Analysis

The Middle East and Africa Dominates the Global Market

Based on region, the global decentralized water treatment market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

The Middle East and Africa is the most significant global decentralized water treatment market shareholder and is estimated to exhibit a CAGR of 10.30% over the forecast period. The increasing need for energy-efficient and cost-effective decentralized water treatment is expected to boost the market for decentralized water treatment in the Middle East and Africa. In addition, the demand for decentralized water treatment in the area will likely increase during the forecast period due to increasing worldwide awareness of water pollution and rapid urbanization. Current water and wastewater treatment practices in Africa must be improved to ensure safe water and basic sanitation. In order to tackle this challenge, joint efforts are required, including innovative technologies, harvesting energy, improving operation and maintenance, promoting public participation, establishing water quality standards, and improving governance and management. Such efforts are expected to boost regional market growth during the forecast period.

Asia-Pacific is anticipated to exhibit a CAGR of 11.00% over the forecast period. Due to the rising demand for technically advanced goods among the populace, the market in Asia-Pacific is predicted to expand exponentially over the forecast period. Further, the rapid urbanization due to the migration of people from rural to urban areas is leading to improved living standards in a region like India, which offers various opportunities for market growth. The significant advantage that Asia enjoys is in terms of the availability of raw materials. China, India, Japan, and others are home to most raw materials, such as polystyrene, aluminum, polypropylene, steel, and others, required to manufacture decentralized water treatment plants, so the cost of sourcing raw materials is reduced for vendors in these countries. Moreover, China, Vietnam, and other Asia-Pacific countries also have cheaper labor and lower electricity costs than many countries. These are a few reasons driving the market.

The expansion of North America's market is supported by growing investments in R&D for enhanced technologies and the region's rising demand for water treatment systems. The most robust economic growth in the US and Canada, developments in industrial sectors, and the company's expansions are driving the sales of decentralized water treatment in North America. In addition, the US is expected to witness significant growth in North America during the forecast period due to well-structured decentralized water and wastewater treatment infrastructure and strict regulations related to effluent emission. For instance, the Safe Drinking Water Act (SDWA) is the primary federal law ensuring Americans' drinking water quality. Under this act, the EPA sets standards for drinking water quality and manages the localities, states, and water suppliers that execute those standards. Additionally, the increasing requirement for upgrading old infrastructure in the region is expected to strengthen the market growth.

The market for decentralized water treatment in Europe is expected to grow with growing disposable income and rising consumer awareness of the benefits of using decentralized water treatment systems. Increasing awareness of the harmful effects of polluted water on human health is driving the adoption of advanced decentralized water treatment systems not only in commercial spaces like offices, hospitals, airports, and others but also in the residential sector and industrial sectors of the European markets. Germany, the UK, and France are some of the countries expected to generate high revenues in the forecast period.

Latin America is expected to grow substantially due to the growing number of shopping malls and hotels and deteriorating water quality in countries. The commercial and residential sectors are expected to have higher sales in the forecast period. Better supply chain networks in Brazil and other countries are expected to boost the supply of decentralized water treatment in the Latin American market. Lower interest rates on home loans in countries such as Mexico and Brazil provide opportunities for expanding the residential sector, which is expected to boost the demand for decentralized water treatment in the region.

Segmental Analysis

The global decentralized water treatment market is bifurcated into the application, system, end-user, technology, water source, and TDS levels.

Based on application, the global market is bifurcated into water treatment, effluent treatment, and wastewater treatment. 

The wastewater treatment segment owns the highest market share and is predicted to exhibit a CAGR of 11.18% over the forecast period. Wastewater treatment, also termed sewage treatment, helps remove impurities from sewage or wastewater before reaching natural bodies of water such as oceans, lakes, rivers, and estuaries. There are various wastewater treatment levels, including primary, secondary, and tertiary levels. Generally, municipal wastewater treatment facilities use primary and secondary levels of treatment.

Based on the system, the global market is bifurcated into point of entry (POE), point of use (POU), and small-scale systems. 

The point of use (POU) segment dominates the global market and is projected to exhibit a CAGR of 11.03% over the forecast period. Point-of-use (POU) water treatment systems are installed to treat water where required, such as in the bath, shower, water bottle, or washing machine. Point-of-use water treatment device installed on a single tap or multitaps and intended to treat water for cooking and drinking at the point of use in a home. It filters the water at the point where water is being utilized and is fitted at a single water connection, mainly under the sink in the bathroom or kitchen. The most popular kind of the point of use system is a reverse osmosis drinking water system.

Based on the end-user, the global market is bifurcated into municipal and industrial. 

The municipal segment owns the highest market share and is projected to exhibit a CAGR of 10.96% during the forecast period. The municipal sector is estimated to be the largest sector by end-user of the market during the forecast period. Globally, the increasing population has increased the demand for treated water. The scarcity of water resources has necessitated more water recycling and water treatment services. The municipal sector includes water treatment facilities in the residential and commercial sectors.

Based on technology, the global market is divided into membrane technology, thermal technology, and others. 

The membrane technology segment accounts for the largest market share and is anticipated to exhibit a CAGR of 11.18% over the forecast period. In the last couple of decades, membrane technology has grown significantly due to its water and wastewater treatment advantages. With a significant reduction in equipment size and low capital cost and energy requirements, membrane technology provides many options in wastewater treatment. There is a constant modification of membrane elements and membrane modules owing to a growing rate of membrane fouling, which is a key challenge for membrane processes.

Based on the water source, the global market is divided into surface water, brackish water, and seawater. 

The surface water segment is the most significant contributor to the market and is estimated to exhibit a CAGR of 11.16% during the forecast period. Surface water includes water acquired from streams, rivers, and dams. Due to the possibility of contamination, surface water is only suggested as a source of drinking water if disinfected and filtered. In addition, regularly surface water should be assessed for E. coli and chemicals of health concern. To ensure drinking water quality, surface water systems usually necessitate routine sampling based on the level of treatment involved. Also, there are various methods for surface water treatment, and water treatment systems help eradicate any contaminants that may present a health risk.

Based on TDS levels, the global market is divided into high-TDS water and low-TD water.

The high TDS water segment dominates the global market and is projected to exhibit a CAGR of 10.71% during the forecast period. If the water contains more than 1,500 ppm, it is usually considered a high TDS content. Though, several water supplies have TDS levels that exceed this limit. Even if the high-level amount is due to beneficial minerals, higher levels of TDS can provide the water with a salty, bitter, or metallic taste, discoloring the water and creating an unpleasant odor. In addition, the high TDS readings are usually caused by chlorides, potassium, and sodium, which have slight to no short-term impacts on human health. At the same time, other toxic compounds like arsenic, nitrate, and lead can cause TDS levels to spike. High TDS water includes seawater and brackish water with more dissolved solids.

Recent Developments

• January 2023- Ekopak, an ESG-driven company that specializes in decentralized circular water solutions such as Water-as-a-Service (WaaS), chose NX Filtration, the leading supplier of breakthrough direct nanofiltration (dNF) membrane technology for pure and affordable water, to supply its dNF membranes for the expansion of a rainwater recovery project in Belgium.

• November 2022- LIFEQUEST WORLD CORP (LQWC) focuses on decentralized, scalable, and innovative wastewater treatment and reuse solutions. With its wholly-owned subsidiary Biopipe India Private Limited, the company simultaneously targets the industrial (ETP) and sewage wastewater treatment (STP) markets.