First, let me say that this article is not about Flint, at least not directly. The focus of this article is on industrial water usage in the United States and what it means for economic development.
As I see it, water and wastewater treatment is the new frontier of the “haves” and “have-nots” in economic development. What was once just a single item on a long list of criteria for a site relocation project has become the main infrastructure criterion for some projects. Ady Advantage has conducted extensive research into the causes, scope and impact of this phenomenon through the lens of U.S. industrial water usage and economic development marketing. Following are some of the key take-aways of our research.
What’s driving the change?
- A lack of water. This is not just a U.S. problem; it’s a global issue. The numbers are staggering, including the data put together by multinational food and beverage processors and industrial companies that depend on water for the products they make.
- Wastewater treatment capacity. Companies usually prefer to have fully treated water. Although many will do pre-treatment if need be, their opening volley is usually for fully treated water from the municipality.
- Water quality, especially when the water is used in the finished goods (beverages, bakery, etc.). Clients often request a large sample of the water to bring back to their existing facility to run pilot batches. If the pilot batches don’t work – too much inconsistency from the main plant – the proposed new location is a non-starter.
What does it mean for an EDO?
- Long-term planning. Today, site selectors working on industrial projects requiring water are asking for long-term projections on how much water and wastewater treatment capacity your region will have available for five, ten, and fifty years or more, including infrastructure improvements that may have been approved but not yet built. We’re forecasting out water capacity 20 years or more to help our clients mitigate risk.
- Reinvestment in today’s infrastructure so that its condition does not reach crisis proportions if one or more large industrial users leave your region. We’ve seen this happen again and again – a municipal water utility has one or two large customers that account for the majority of its capacity. One or both close down or leave, and the monthly payments evaporate. The utilities that have not reinvested in their infrastructure are in a very difficult spot.
- Decisions about what types of relocation projects you want and can support. Several of our clients are already turning down water- and wastewater treatment-heavy prospects, while other areas are actively recruiting these types of projects. We’re just starting to see some communities marketing themselves based on these attributes.
What does it mean for manufacturers?
- Saving water can save money, and wasting water will no longer be a luxury. The resources available on sustainability programs are remarkable. We recommend starting by talking to the OEMs you serve to see what they are doing, and what practices you can adopt.
- Long-term outlook for risk. In certain parts of the country, there is a very strong likelihood that water will become scarce. What is your long-term plan? Should you begin to think about relocating or expanding to other regions to diversify your water sourcing and mitigate risk? Moving now will pre-empt your competitors, most of which are not yet thinking about this threat.
Is your region positioned to be one of the “haves” on this new economic development frontier? If you haven’t yet assessed the strengths, weaknesses, opportunities, and threats of the water and wastewater treatment situation in your region, Ady Advantage can help. Our team can assess your current situation and identify possible risks to mitigate and benefits to promote. If you’re interested in learning more about how to factor water usage into your BRE, business relocation, and marketing goals and strategies, contact Janet Ady at 608-663-9218. And if you’re a company looking to understand the best location for your business to locate long-term, we can help you with that, too.