ACE Gets its Mojo Back in 2013

2013 AWWA Annual Conference & Exposition in Denver a Return to Good Old Days

I know I am not alone in saying that over the last 4 or 5 years the AWWA Annual Conference and

Exposition has been slipping in attendance and overall energy compared to WEFTEC which seems to have benefited from attendees having to make a choice between the two conferences in tougher economic times. I know sales reps and some manufacturers have for many years wished that both conferences be combined to avoid the expense and time of having to attend both and the economic downturn of 2008 was a trigger to select one to attend. The choice has usually been WEFTEC which has more of a wastewater focus where a larger percentage of water industry equipment sales are made. Well, after the renewed energy, increased attendance and overall buzz of ACE13 in Denver, I think talks of a merger will be put to rest for at least a few more years.

As one of the exhibitors who are an important source of funding for ACE, I was very happy with the increased flow of attendees through the exhibit hall this year. The increased traffic was apparent on Sunday which in recent years has been dead, with more families in particular walking the floors (that attendees had brought on vacation) - I can't remember so many families for perhaps 6-8 years. And on Wednesday, the last day of the show and traditionally the slowest, I was busy talking to people at the booth all morning. I didn't get to see a single presentation as I was so busy at the booth and at meetings during the show.

Why was this ACE probably the best since ACE08 in Atlanta? Being in AWWA's home town of Denver, the organization certainly put in an extra special effort in revamping the schedule and events and in pre-show marketing. It was about time that some effort was put in to updating the program as I do think it had stagnated in recent years and lost ground to WEFTEC. I believe Denver's more central location, affordability and attractiveness as a destination for a larger spread of AWWA members also was a factor in the sucess of ACE13. Perhaps also it is a sign of improving economic conditions - I certainly heard of more new projects in the works compared to recent years.

Should ACE and WEFTEC merge? I can see the point of view of sales reps and the larger manufacturers who have to role out the marketing, booths, client entertainment and all the other expenses required for two shows that may have a big overlap in their customers. As a smaller manufacturer of primarily drinking water treatment equipment we can still get pretty good exposure at the ACE exposition which is located in a single exhibit hall, while I wonder if anyone would find us tucked away at the back of a secondary hall at WEFTEC? We certainly would have trouble competing for some time with our customers and sales reps versus the lavish functions put on by the larger multi-national OEMs (heck, I didn't even see some of our reps at ACE...). And I am sure there would be less room in the technical program for potable presentations which would impact engineers, utilities and researchers focussing on just drinking water. I therefore think the two shows should not merge to allow the smaller specialty OEMs and engineering firms as well as researchers have a say in the water industry rather than be made insignificant at a mega-water show.

Can AWWA generate some momentum from ACE13? I don't know. AWWA certainly needs to continue to review the conference program, get feedback from exhibitors and attendees and continually improve for ACE14. ACE14 in Boston will be a challenge being in an expensive city on the far east coast. My suggestion is AWWA should look at WEFTEC which has selected a limited number of locations that are popular for a wider range of attendees. Certainly, ACE should be in Denver every 5 years at least based on the success of ACE13!

Universal MF/UF Module Systems all the Rage at AMTA/AWWA Membrane Technology Conference

Without question, the buzz at the AMTA/AWWA Annual Membrane Technology Conference in San Antonio TX in late February was all about universal Module MF/UF Systems. It appears that sometime in the past 12 months the tipping point was reached and consultants and municipalities are finally embracing the concept of bidding multiple UF/MF modules, with multiple qualified OEMs open to use any of these. This is very similar to the model I mentioned in my post in October 2012 (Dow and Toray UF Modules Level Bidding Playing Field).

What was the buzz?

What has led me to make this statement is as follows:

• For a start, I had three consultants from national engineering firms drop by my booth and ask if we could build a MF/UF skid that either has interchangeable UF modules (i.e. has an adjustable header for different module configurations) or whether we could bid to a spec that qualified a number of MF/UF modules from different suppliers.
• Degremont used the show to promote a newly developed ‘SmartRack^TM’ that can accommodate different brands of UF modules (their brochure was passed to me by someone at a bar one night).
• A paper was presented by Carollo Engineers detailing an existing system in Utah that has decided to retrofit with membrane racks designed for interchangeability so that in the future multiple membrane suppliers could bid for the replacement membranes. A factor in this decision was the fact that the installed membranes had not lasted as long as expected and the utility did not want to remain locked in to one membrane supplier. I had a few engineers say to me at the show that the MF/UF membranes in many existing systems are nearing the end of their life causing some concern to the owners that they are locked in to the original membrane supplier while they would prefer to bid out the replacement.

Summing up the mood of the show was a comment I heard at a bar late one night from a Senior VP from one of the Big Three MF/UF OEMs that “If you just want to buy the membranes, we’ll sell you the membranes….”

Now don’t think I was just hanging out at the bars at the conference, but any seasoned conference attendee will tell you that is where all the real news and developments are discussed at these events!

Walking the Talk!

To prove all of the buzz was not just hot air, in the past 3 months there have already been some significant developments. West Basin Municipal Water District just put out a RFQ for OEMs to build a pilot system that can interchange MF/UF modules from different suppliers so that that the District can evaluate different modules for future installations. I have also been passed a draft specification to review from a national engineering firm for a significant sized system that will prequalify several OEMs and MF/UF modules as per the example in my previous post. I have also been asked to provide budget pricing from another major engineering firm for a MF/UF system in a reuse application where the owner also wishes to bid this as a universal MF/UF system.

I do have to clarify that most of the above projects are reuse applications which are perhaps seen as a lower risk to launch the universal module model, but with the involvement now of the major consulting firms and significant size water utilities, it will not be long before we see a lot more drinking water projects using the same model.

Siemens Saying Uncle?

As I was about to finish this post, I read an article in Global Water Intelligence’s May newsletter that Siemens Water Technologies’ (SWT) CEO Lukas Loeffler has predicted a shift to horizontal integration in the MF/UF market with increased commoditization in the component business (read MF/UF modules). As a result, Siemens is planning on separately selling the Memcor membrane production facility in Australia from the rest of the Siemens water business. Loeffler said he did not think the commoditization will happen in the next 2 years but maybe over the next 10-15 years.

Obviously I agree with SWT’s assessment of the direction of the market but I don’t agree with the predicted gradual rate of change. Based on the developments in just the past 3 months, I predict we will see commoditization in 5 years or sooner. Not to the extent we see with the Reverse Osmosis market, but certainly bids for universal MF/UF module systems will become more and more common.

Still Only Specifying the Big Three MF/UF OEMs - Ignorant or Irresponsible?

By now any engineers that claim they do not know about OEMs offering credible MF/UF systems other than the Big Three (Pall, Siemens and GE) are either ignorant; in that they are not aware that many of the new skid mounted installations over the past few years have used either Toray or Dow UF modules in systems built by OEMs other than the Big Three; or they are too lazy to revise their 5-10 year old boiler plate specs (I say that is irresponsible as it is the consultant’s responsibility when engaged by a municipality to select the most technically and economically feasible solution to meet their needs). A year ago I would have cut the engineers some slack where the first municipal systems using Toray and Dow UF modules had only been operating for about 12 months and there had not been a lot of data presented on these systems. But now after another year with more and more presentations at trade shows and publicity about these systems, for an engineer to claim they didn’t know there was an alternative to the Big Three or they didn’t know enough about the alternatives to include them in a spec, is just downright lazy and this engineer does not deserve to be hired by a small system.

To further my point, at the AMTA/AWWA Annual MembraneTechnology Conference a few weeks ago (Feb 25-28), our booth was approached by three engineering firms, two of which were national firms, about real projects where they are looking at building UF systems with interchangeable UF modules, and obviously the Big Three would not be interested in building these. Any engineer at this show with any membrane experience could not have missed the buzz about a shift to systems that can use different UF modules. I will write a separate post specifically on this topic shortly.

I will accept if an engineer and his client says they did look at the alternatives but their selection criteria required installations with say 5-years' of operational experience, particularly for large systems where the newer UF modules have not yet been in service for long enough. I would however suggest these engineers talk to some of the users of the Big Three MF/UF systems with over 5 years’ experience and ask if they are happy with their systems – I am sure many will not be happy – and then I would question why these OEMs are qualified ahead of other OEMs that may not have had installations operating for as long, but have had only one or two membrane fiber breakages over a 2-year period (many have had none). I bet if you picked any 2-year period for at least two of the Big Three OEMs’ systems operating for 5-10 years, the performance of these systems in terms of membrane integrity would not come close to the first 2-years’ performance of the systems using Toray and Dow membranes.

I’m sorry about this rant but I just spoke to an engineer at who’s firm I had presented a brown bag 2-years ago on our Toray UF installations, and where I had also spoken to other engineers at his firm in the past 12 months about our systems, and then he says sorry he did not know enough about our UF system in time for a spec he just wrote for a ~1MGD installation in which he just specified the Big Three. I hadn’t made contact with this specific engineer but for this firm to be not willing to consider any other OEMs for this small system is just plain ignorance and will probably end up costing a small City at least $200K. I am sure that is not the outcome this City wanted when it hired this engineering firm….

How do you build the Best Commercial RO Membrane System?

Recently I was talking to a consulting engineer about the membrane systems we build and he said “so you don’t actually manufacture any of the components, you just assemble the system?” I was a little taken aback with this comment as this is pretty much what all membrane OEMs do. Either the engineer didn’t understand how membrane systems are put together or he had been sold on one of the few OEMs that manufacture a few of the components used to build the membrane system. I look at a bill of materials for a RO system and there are over 300 different components …… So if out of all of these an OEM manufactures the feed pump and pre-filters is that going to be a better RO system?

The beauty of being a completely independent OEM (Original Equipment Manufacturer) is that you can select the best available components to build a membrane system for a specific application.
You can choose a pump that is most energy efficient and perfectly sized for a skid, rather than one OEM that must use multiple feed pumps per skid because of limitations in pump sizes that it manufacturers. When new components become available, the independent OEM (typically the smaller more nimble OEMs) can quickly incorporate these into a system design to the benefit of the end user.

And next time I see a spec that says the Reverse Osmosis OEM must also manufacture the membrane I will feel sorry for the end user who will have been duped into overpaying for a product no better than what they could have bought from an independent OEM. RO membranes are a commodity and there are several suppliers such as Toray, Dow/Filmtec, Hydranautics and CSM that sell to OEMs, offer very good technical support and provide prorated warranties for the membranes of up to 5-years depending on the application. I was actually visiting a manufacturing facility of one of the aforementioned membrane companies and was surprised to see a stack of boxed membranes private labeled for an OEM who claimed to make their own membranes…. Even if the company did make its membranes, with the ability to purchase from multiple RO membrane vendors, the independent OEMs can choose the best membrane available for an application, get very competitive pricing and pass on a more economical RO system to the end user.

Smaller systems are often the biggest losers when purchasing a membrane system when they or their engineer are convinced that larger OEMs that also manufacture some of the components will provide a more reliable system with better technical service. In reality, the larger OEMs may be encumbered with outdated equipment they have to use which is more expensive than components available from other independent suppliers. And don’t start me on the technical service….Just talk to a small system that has purchased equipment from a large OEM recently and see what they say!

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.