Dow and Toray UF Modules Level Bidding Playing Field

Is commoditization of the MF/UF market finally here?

The specifications for a project that recently bid in South Dakota were a sign that the municipal Microfiltration/Ultrafiltration (MF/UF) membrane market is finally moving towards commoditization. It is the first MF/UF specification that I have seen where there were both prequalified OEMs and prequalified MF/UF membrane modules, allowing the OEMs to bid using any of the listed modules. This type of specification is common in the commoditized NF/RO market, but has been almost non-existent as far as I am aware in the municipal drinking water market. The modules listed in the specification were the following PVDF, hollow fiber membranes:

• Siemens/US Filter L20V
• Pall Microza MF
• Toray HFS
• GE Zeeweed 1500
• Dow UF (SFD 2880)

Of course Siemens, Pall and GE have exclusive access to the L20V, Microza and Zeeweed 1500 modules respectively, but any of the listed OEMs could bid with the Toray and Dow UF modules. Additional OEMs listed were Wigen Water Technologies and H2O Innovation, both of whom have municipal UF installations using Dow and Toray membranes.

There were some unique circumstances with this bid that allowed such a specification, where all of the above membrane modules had previously been piloted on Missouri River water in the Dakotas, which was also the source water for this new plant. All of the qualified OEMs had at some point conducted a pilot study under the supervision of Bartlett & West (B&W), the consulting engineer managing the project and therefore were not required to pilot for this project. To be qualified, OEMs also had to have installed at least three surface water MF/UF systems between 1 – 5 MGD.

Customers Win!

 With such a competitive bidding environment and probably due to the system size (2.7 MGD), only one of the ‘big three’ OEMs bid for the project. Not surprisingly, the lowest bidder (and subsequently the winner) bid with Dow UF modules and was more than 25% lower in price than the bidder with a proprietary membrane. Worth noting is that even the highest bidder was almost 30% below the engineer’s estimate, evidence of how much value can be achieved for customers with more competitive bidding. This is particularly the case for smaller systems that historically been reluctantly served by a few larger OEMs, resulting in high prices. Now that Dow and Toray offer their UF modules to multiple OEMs, smaller OEMs such as Wigen and H2O are aggressively pursuing this segment of the market, resulting in lower prices and, I am sure, happy customers!


Dow UF System at Fort Thompson, SD
OEM - Wigen Water Technologies

You have to give credit to B&W for writing such a spec which has saved their customer a significant amount of money. B&W's client base is small to medium municipalities and they have found a way to make advanced water treatment technologies more affordable to these customers. It is unlikely you would see such a spec from a global consulting engineering firm, but then these large firms rarely deal with the smaller municipalities anyway.

While it may not be possible to bid this sort of specification for many water sources, there are many shared water supplies where multiple membrane types have been tested and OEMs have experience, allowing a more competitive bidding process. With a number of proven pressurized PVDF hollow fiber membrane now on the market, and with system designs becoming more standardized in terms of integrity testing, block and bleed valving, recovery rates and cleaning regimes, it is becoming possible to write more standardized specifications for pressurized outside-in UF modules, much like for NF/RO systems.

The end result, as the MF/UF market moves towards commoditization, is lower membrane module prices and lower system prices which means high quality drinking water becomes more affordable and accessible, particularly for smaller systems who have historically had to bear the brunt of an uncompetitive marketplace – a great example of competition benefiting the end consumer!

Has Journal AWWA Lost its Way?

Is new format a step forward or backward?

I used to keep the latest copy of the Journal AWWA (JAWWA) in my briefcase for a month or two as I gradually read the technical articles. Sometimes I would have several issues backed up if there were a lot of articles of interest I wanted to read.

Last week, as I flicked through the most recent issue in about 30 minutes, I wondered if the new format of extended abstracts rather than full technical papers is a step backward for the traditional readership. I was also left with nothing to read for the remaining hour of my plane trip….A couple of the abstracts looked interesting and if the full papers were there, I would have read them, but for the new format I have to go online to find the full articles. Not really practical on a plane or in the lunch room when I typically read JAWWA. Maybe I am old school, but I am not going to read a technical paper direct from my computer screen anyway, so that means I now have to print it and carry it around with me so it is available when I get time to read it on a plane or at lunch – not going to happen! The end result is I am less informed about new technical developments in the Water industry, one of the main benefits JAWWA previously had to offer me.

I can’t recall the reason the American Water Works Association gave for the new format. I probably should have said something when this was announced but I didn’t realize at the time how the changes would impact me. JAWWA is now slipping towards the tabloid status of WE&T, Waterworld and Water & Wastes Digest, which have more room for advertising and less for substance. Was the change to JAWWA to allow the inclusion of more articles to keep authors happy or allow more advertising or both? Has it been worth it?

AWWA had better be careful it does not lose members out of this change. When I was living in Australia and did not have access to AWWA conferences and Section resources, the main reason I was an AWWA member was primarily to get the Journal followed by access to the book store and technical library. I was speaking to a consultant at the recent AWWA Annual Conference in Dallas about how difficult it is to keep up with the technical reading and every few months he said he went through his pile of magazines and threw out everything except JAWWA which was a must read. I was the same, but with the new format, my JAWWA pile now goes down a lot faster – in fact I don’t have a pile now… Is that a good thing or a bad thing? Will that consultant soon also be throwing out JAWWA without looking through it?

Personally I think JAWWA is losing the technical high ground it had over other water industry publications and if it moves too far away from what previously differentiated it from these publications, will lose readership of the very people it needs to attract its advertisers and members.

Serious Challenge to ‘Big Three’ at 2012 Membrane Technology Conference

Papers and Booths from new MF/UF OEMs indicate grip of Big Three is loosening

It is official; the grip of Pall, Siemens and GE on the municipal microfiltration (MF) and ultrafiltration (UF) market is loosening! Based on the presentations showcasing MF/UF systems at the AWWA/AMTA 2012 Membrane Technology Conference and Exposition in Glendale, Arizona, Feb 27-March 1, it was clear to all attendees that in the past year new OEMs have made significant strides in entering the market. Systems using Toray hollow fiber UF membranes appear to have gained the most traction with Dow UF membranes close behind.

A poster from Wigen Water Technologies [1] showcased 1 and 2 MGD systems in North Dakota using Toray UF modules that started up in early 2011. These systems have been operating well and to-date have not experienced a single membrane fiber breakage. A URS poster [2] titled “It’s not Just the Big Three Anymore…” featured a project for a 7.2 MGD UF system in Ohio where prices from OEMs using Toray and Dow membranes were significantly lower than the Big Three, and pilot performance was as good or better. Following pilot testing, a system using Toray UF membranes was subsequently selected and is in construction.

In addition to the presentations, Kruger used the AMTA/AWWA Conference to launch its new UF system utilizing the Dow UF module while a number of other OEMs had booths showing that they also were entering the market using either the Toray or Dow UF modules.

It will be very interesting to see in the next 24 months which OEMs are most successful in gaining a foothold in the MF/UF market alongside the Big Three. Will this market move towards being commoditized like the NF/RO market where a particular membrane module and skid design will be specified and a number of qualified OEMs can bid to build systems using this module and design? I don’t think we will get to this point in the near future, but I am sure those OEMs using proprietary membranes or with exclusive supply arrangements will be getting a little nervous!

References

Bourke, M.F.; Guibert, S; “Performance of First Large Scale U.S. Ultrafiltration Systems Using Toray Membranes”, 2012 Membrane Technology Conference & Exposition, Glendale AZ, Feb 27 – March 1.

Shoaf, R.T; Cook, J.M.; “It’s Not Just the Big Three Anymore – Pilot Testing and Membrane Selection for the Delaware Ohio Integrated Membrane Facility”, 2012 Membrane Technology Conference & Exposition, Glendale AZ, Feb 27 – March 1.