Fighting the Water Crisis, One Applied Innovation at a Time
In the face of global water challenges such as water scarcity, pollution, and aging infrastructure, the WaterTech sector stands as an exemplar of Applied Innovation. In conversation with Singularity Think Tank WaterTech expert David Balsar, we assess the innovation opportunities and challenges in the water and wastewater sector. David Balsar is a renowned expert in the field of WaterTech. In his role as Innovation and Ventures Manager at Israel’s water company Mekorot, he has spent the last decade exploring the World’s water problems and the technological solutions offered by advances in automation, Big Data analytics, AI, and material science.
Global Water Challenges and Solutions
An estimated 25 nations, which collectively represent one-quarter of the global population, endure extremely high water stress where water demand regularly outstrips available supply. 50% of the global population lives under conditions of water stress at least one month a year. Amplified by climate change, pollution, and aging water infrastructure, the World’s water challenges mount high.
“There is no magic cure or singular technology that can address all water issues,” Balsar forewarns. Yet technological advances have successfully helped to catapult thorny problems to the past. “Turning seawater into drinking water through desalination and converting wastewater to drinking or irrigation water were once dream scenarios but have become a reality.” The focus now, Balsar argues, is on making water management more efficient and effective through technological advancements. “Innovation is more and more about how to run more efficient water networks. That is where the major focus of water technology is today.”
While water challenges are prevalent in many countries, disparities in water supply, available remedies, and varying levels of political willpower mean the landscape of water solutions is highly diversified. “Take sea desalination as an example,” says Balsar. “It is a scalable remedy. Nevertheless, some countries face a shortage of political resolve, as we’ve seen with Portugal’s struggles in executing extensive desalination initiatives, largely attributed to local opposition, often referred to as NIMBY (Not In My Backyard) resistance. In most cases, the gap has shifted from the technology not being good enough to policy makers lacking the stewardship that is needed to scale up solutions for a water positive environment.”
In Southeast Asia, water challenges include the annual struggles with severe floods during the rainy season, exacerbated by inadequate infrastructure. Driven by recent economic growth in the region, which has increased water and energy demand, balancing economic development with environmental conservation is another crucial issue.
Some of these challenges cross national borders. When multiple countries share rivers — many of which are highly polluted by chemicals, sewage, and industrial waste — disputes often arise over cross-border water resources, while groundwater overexploitation in some areas necessitates measures to improve alternative water sources and storage. These challenges are intensified by climate change, which alters rainfall patterns and increases the frequency of extreme events like droughts and floods.
Applied Innovations and Investment Opportunities: Modernizing Infrastructure and Managing Wastewater
Among the promising solutions are the integration of AI and Machine Learning, Internet of Things, and Digital Twins into applications in smart drinking water networks and water systems for agriculture, where these technologies enhance operational efficiency and provide critical data for informed decision-making.
For example, Digital Twins enable virtual representations of the actual behavior of a city’s water system and emulate its reactions under various scenarios. Within the water industry, this technology empowers utility companies with a comprehensive grasp of their ongoing processes. It revolutionizes water usage monitoring and conservation by allowing companies to carefully plan and control their water systems.
Enabled by such technologies, water reuse has gained traction in the context of a circular economy. “Technologies that facilitate water reuse, such as wastewater treatment plants focusing on minimizing pollution and maximizing water recovery, are essential given the significant portion of the global population expected to face water scarcity,” notes Balsar. “The wastewater sector is a critical innovation frontier because reaching the next level of efficiency requires companies and governments to solve problems that need a strong technology push.”
With the global water and wastewater treatment market projected to experience significant growth from over USD 346 B in 2024 to over USD 610 B by 2032, innovative companies in this sector are at the forefront of market growth. Innovation leaders involved in water infrastructure and wastewater treatment include Singularity Fund member Xylem, Inc., a producer of water filtration and purification products, and Veolia Environment SA, a constituent of our recently launched Smart Farming strategy in collaboration with LUKB whose wastewater treatment technologies include innovative solutions for agricultural runoff and recovery of critical nutrients, minimizing environmental impact.
With many global metropolitan regions relying on water and sewage systems for which the groundworks date back to the Industrial Revolution, another area that is ripe for technological innovation concerns water infrastructure repair and upgrades to legacy systems. Take London for example, part of which has water infrastructures dating back to the Victorian era, leading to a plague of leakages, capacity issues, water quality concerns, and risks of sewage system overflows. To keep the costs of solutions in check, the city relies on leakage detection and repair technologies including acoustic sensors, satellite and drone surveillance, modern filtration solutions, advanced data analytics, and techniques for repairing existing pipelines requiring minimal digging such as Cured-in-Place pipe lining.
Quenching Agriculture’s Thirst
In agriculture, which accounts for around 70% of global freshwater usage, digital technologies have also come to play an increasingly important role. Feeding a world population estimated to grow by 2 billion people by 2050 demands an additional 19% water supply. Achieving this growth requires considerable investments in efficient agricultural technologies that enable a more sustainable and equitable use of water resources.
Innovation leaders in this area include Valmont Industries, Inc., a key player in smart irrigation solutions and another constituent of the LUKB Smart Farming strategy. The company offers technologies such as an irrigation system that hosts cameras, sensors, and other smart devices, which collect data on plant health, soil moisture, and pest activity to allow for precise water delivery to crops. Valmont’s solutions not only help farmers to conserve water resources but also ensure that crops receive the optimal amount for growth — a critical aspect of sustainable water resource management.
A Sector Ripe for Investment in Applied Innovation
Driven by the urgent need to address global water challenges through technological innovation and infrastructure development, WaterTech presents a compelling opportunity for investors in Applied Innovations. Whether it concerns wastewater treatment, water reuse technologies, or smart irrigation, as the world grapples with a growing water crisis, WaterTech emerges as a life-critical innovation domain.
About The Singularity Group
The Singularity Group (TSG) quantifies Applied Innovation for investors in listed equities. TSG is the initiator of the Singularity Index™ (Bloomberg ticker: NQ2045), a global, all-sector benchmark and gold standard for Applied Innovation. The Singularity Strategies include The Singularity Fund (UCITS Lux), Singularity US Innovation Leaders (AMC), Singularity Small&Mid (UBS AMC), Singularity Reindustrialization (UBS AMC), and LUKB Smart Farming (AMC). The Swiss investment advisory boutique works closely with the Singularity Think Tank, a network of entrepreneurs and academics with deep insights into innovation value chains. Their input forms the foundation of TSG’s proprietary innovation scoring system that quantifies the engagement of companies within a set of curated Singularity Sectors worldwide across all market capitalizations and industries. The Singularity Innovation Score (SI-Score) defines how much value listed companies are generating through Applied Innovation.
