Picking the circular economy technology winners
Interview with Paul O’Callaghan, CEO of BlueTech Research
There is great interest in the opportunities around the circular economy, especially in Europe. This is precisely why it will feature as the theme of the BlueTech Innovation Pavilion at Aquatech Amsterdam in November. But which technologies will succeed, and where should investors put their money?
One lesson from recent research by BlueTech Research into the fortunes of some 85 water sector companies set up between 2002 and 2006 is to look at what is likely to drive uptake of a particular technology. ‘Many of the companies that failed were too early – they were anticipating a major change in regulations that never happened,’ says Paul O’Callaghan, BlueTech’s CEO.
Regulatory driver and efficiency is ideal
‘When we look at new technologies that are coming to market, we look to see whether there is a big driver like a regulation, or whether it is much more efficient than what’s out there already,’ explains O’Callaghan. ‘Some tick both boxes, which is the ideal scenario.’
A shift to a circular economy should focus first on ‘dematerialisation’ – avoiding and reducing the use of raw materials as far as possible. ‘That would mean finding an alternative way of achieving an end goal without using water or using a lot less,’ says O’Callaghan. The next step is to become much more efficient in the use of resources, where he notes in particular the potential of digital technologies and IoT to make a contribution. The third aspect of the circular economy is then to recover resources.
A sneak preview
O’Callaghan identifies some of the most promising technology areas set to contribute to the circular economy and which will feature in the Innovation Pavilion. One is membrane aerated biofilm reactors (MABR). This wastewater treatment technology features membranes to introduce oxygen by diffusion, replacing use of blowers and diffusers and reducing aeration energy requirements. ‘That’s a very significant change,’ says O’Callaghan. ‘It’s very much at the early adopter stage of the market at the moment,’ he adds. ‘Within five years we anticipate it should become more accepted and more widely used.’
Another promising area is with technologies that recover phosphorus from wastewater. ‘There is a value proposition to recovering phosphorus in that it can help comply with regulations at a lower cost,’ says O’Callaghan. He notes that there are strong policy drivers in Europe, framed in part by the continent’s reliance on imports of the raw mineral. Already quite a number of water utilities are working with these technologies. ‘This is definitely in the early majority section at the moment. It is a growing area.’
The third area O’Callaghan draws attention to is the broad topic of biogas. ‘The whole topic is one of the fastest moving areas,’ he says. It includes a range of technologies at different stages of take-up by the sector. It includes, for example, anaerobic membrane bioreactors. ‘This has been one of the more rapidly moving technologies of the last five years, moving steadily through the early adopter stage, with new competitors entering the market,’ he says. Other promising examples include use of biogas to provide methane as a feedstock for production of bioplastic, use of bioelectrochemical systems to generate methane in industrial applications such as brewing and wine making, and upgrading biogas so that it can be used as vehicle fleet fuel or be fed into the natural gas grid. The number of biogas upgrading plants has been growing at 23% per year between 2008 and 2016 and this looks set to continue, notes O’Callaghan.
Big + small = excitement
Technologies such as MABR stand to contribute to a shift to a circular economy by reducing energy requirements, and a steady deployment can be expected because of these efficiencies. ‘Technologies such as MABR don’t need a regulatory driver because they have got a really clear value proposition,’ says O’Callaghan. That said, there are other factors that can come into play in determining whether a technology achieves widespread use. ‘I see a lot of partnering between bigger players and smaller players,’ he says. ‘Big companies are better at getting technologies to market. Small companies are quite good at being nimble and innovating. If you put the two together, you see some exciting things starting to happen.’