The world of membranes has fundamentally changed in the last five years. It started in 2015 with the acquisition by GE of IMT, the specialist Dutch manufacturer of a seven-bore PES fibre similar to inge. This acquisition represented the first time that a membrane filtration company began to present itself as a portfolio product provider rather than being an advocate of a specific material or format. In the case of GE’s Zeeweed product range, use of the PVDF material and the outside feed format had always been an article of faith, but IMT had an inside feed PES product, which up to that point represented the competition as far as GE was concerned.
In 2017, a second tectonic shift began in the membrane landscape, with the merger of Dow and Du Pont (or the acquisition of Dow membrane business by Du Pont judging by the name change!). In the same year, Suez acquired the GE water business.
During the last 9 months, the fall-out from those acquisitions has emerged. Firstly, Du Pont, acquired inge thereby also becoming a portfolio company like Suez, with the addition of PES to a PVDF portfolio. Note that both Du Pont and Suez chose to diversify into PES by using a multi-bore version of the fibre, since for years both companies have attacked the integrity of the single bore offerings. There are now two companies in membrane filtration which are not wedded to a particular material. Perhaps more surprising, Du Pont then acquired Evoqua, presumably for the MBR product, and in doing so have partially imitated the system supply business model of Suez.
We have therefore ended up with two giants of the membrane filtration world, each offering a more or less comprehensive portfolio, closely imitating each other in their technology and business offering. Prior to that point, the market had been showing signs of diversification, particularly in the US, due to the preference for module only supply from potentially interchangeable suppliers. Up to 2017, smaller suppliers had been progressively gaining share, but that trend has now been arrested.
Of course, the one gap in the armoury of both Suez and Du Pont is that neither company has a PVDF TIPS offering, and in some circumstances, this has been a preferred option and occasionally even specified. And neither has a ceramic offering. Significant project wins have been recently announced for products outside of the portfolio offerings of the two majors, including single fibre PES, PVDF TIPS and ceramics, so the gains of consolidation may not be as all pervasive as would first appear.
One offering that has set Du Pont apart from Suez until recently has been the main-stream offering of Dow RO. The Dow RO business has been market leading for years, and a dominant force in all water applications sectors. In contrast, Suez has up to now been restricted to the specialty RO portfolio from the original Osmonics business. However, last week Suez announced the acquisition of the Lanxess RO business. Though not known for SWRO, Lanxess has major scale manufacturing and an established competitive product in standard brackish water applications. It would be relatively straightforward to expand the portfolio into SWRO. Suez has long claimed to be on the verge of introducing its own SWRO product range and that now looks like it could be distinct possibility in the near future.
What does all this mean to users? Does it restrict competition and stifle innovation? Probably not. On the plus side, there are now two suppliers which address both the pre-treatment and RO sides of a complete desalination project with highly competitive offerings. This makes purchasing and warranty much less of a headache. However, does the partial system supply model of these businesses represent a risk for an EPC? Perhaps so, and it is therefore likely that independents outside of the two portfolio companies will continue to flourish and, based on history, will continue to drive innovation.