With more than half of the world’s population now living in urban centres, our cities are increasingly under strain.
One of the many challenges municipal authorities need to address is the provision of utilities – including water, waste and energy management. This is a major discussion point in our recent Amity Insight – Sustainable Cities report.
Pleasingly, many local governments are introducing measures specifically addressing this issue. For example, Los Angeles has set strict targets for the sustainable provision of water and waste management services. However, in an era of austerity and increasing populations, local and city authorities are struggling to develop the innovative solutions. Therefore, authorities have chosen to partner with the private sector to develop these capabilities.
Below we outline five businesses developing and deploying innovative utilities solutions, all offering compelling investment fundamentals.
Tideway is involved in the design, construction and maintenance of London’s new ‘super sewer’. The current sewer system, which is 150 years old, can no longer cope with the city’s waste volumes, which is leading to 50-60 sewer overflow discharges into the river Thames annually. This project, partly financed by a £250m 10-year secured ‘green bond’, will reduce the river’s contamination levels and improve the safety of the city’s water supply.
Veolia is a leader in environmental utilities solutions – including water management, waste management, transport, and energy services. The company is already benefitting from the uptick in European economic growth, which tends to lead to higher rates of waste production, coupled with increasing regulation regarding recycling. Veolia is taking a holistic approach to waste management, with the material unable to be recycled turned into solid recovered fuel for energy production. With this approach, 95% of the waste processed by Veolia is diverted from landfill.
Suez, which specialises in water treatment and waste management in France, has developed an economic and ecological solution to capture the heat in wastewater and re-inject it into heating circuits. This technology is already used to heat 13 sites – including swimming pools, office blocks and the Elysée Palace in France.
Schneider Electric specialises in energy management – with a mission to ensure energy is ‘safe, reliable, efficient, sustainable and connected’. EcoStruxure is the company’s ‘internet of things’-enabled solution, helping to drive operational and energy efficiency. It allows energy efficiency in management of homes and other buildings, while also allowing entire cities to have more efficient infrastructure.
Engie, a multi-utility provider focusing mainly on electricity generation, has taken a multi-faceted approach to building sustainability into its business. Engie is an industry-leading provider of energy efficiency solutions, with many of its projects financed by €6.25bn of green bonds issued since 2014. These include decentralising energy production – with wind, solar, biomass and geothermal ‘micro production’ facilities rolled out to homes and neighbourhoods. This is helping to shrink the footprint of energy production and reduce energy loss across the grid.