Privatisation fuels green sector
15 Jan 2000
The world environmental technology market will grow from $888bn in 1996 to over $1000bn by 2000, according to market researchers at the McIlvaine Company. New concepts of equipment ownership are helping to drive the market, it notes.
The industry profile at the turn of the century will see sales of environmental products at $107bn and services at $18bn, but both of these sectors will be dwarfed by management of environmental activities at $894bn. This is due to the increasing rate of privatisation, McIlvaine notes; private-sector companies present a much larger opportunity to environmental managers.
Although the solid wastes sectors of the environmental industry have traditionally been in private hands, the sell-offs in the drinking and municipal waste water sectors, led by the UK and France, have opened up the market for management, products and services. This is a trend that is set to continue - the developing nations are in desperate need of clean water, and with over a bn new city-dwellers predicted in Asia alone over the next 20 years, McIlvaine believes that the only way to raise the funds for the necessary infrastructure improvement is through even more privatisation. `As a result,' says the report, `management of environmental activities will be one of the fastest-growing worldwide industries.
Another factor contributing to the rise in environmental technologies is the new concept that whoever supplies environmental equipment remains its owner. This means that, for example, a power plant operator can switch from a clean fuel to a dirty fuel, but can avoid paying the capital cost of the required air pollution equipment, which is included in the fuel price.
The largest untapped sector in the industry is in the air pollution control sector, says the report. Management of air pollution control will be worth $234bn in 2000. At the moment, however, only companies like Air Products and Chemicals and Mitsubishi are active in this sector. The water segment, worth a total of $539bn, is seeing much more activity, with British, French and American companies, as well as the major international contractors and business consultancies, all scrabbling for market share.
