Transcript Washington Update 2010



May 2009
Environmental Industry Review 2015
Grant Ferrier
Editor, Environmental Business Journal
Editor, Climate Change Business Journal
President, Environmental Business International, Inc.
Chairman, Environmental Industry Summit XIII, March 11-13, 2015
Presentation Outline
BIG PICTURE: 2013-2014 data
Environmental Industry: Economics &
Statistics; Trends
Key Growth Factors in the 2000s and 2010s
Consulting & Engineering Segment
California Perspective
Environmental Industry in Context: Growth
10%
USA GDP growt h
Environment al Indust ry growt h
8%
6%
4%
2%
0%
89
90 91
92 93
94 95
96 97
98 99
00 01
02 03
04 05
06 07
08 09
10 11
12 13
-2%
-4%
SOURCE: EBI Inc., San Diego CA; Annual segment-by-segment research; government shutdowns
in 1995-96 and October 2013
14
Environmental Industry: 2012-2014
INDUSTRY SEGMENT
Analytical Services
2012
2013
2014
2013
2014
2.0
1.9
2.0
-1%
2%
Wastewater Treatment Works
50.9
53.2
55.3
5%
4%
Solid Waste Management
55.3
56.7
58.1
3%
2%
Hazardous Waste Management
10.6
10.7
10.9
1%
2%
Remediation/Industrial Services
13.6
13.9
14.4
3%
3%
Consulting & Engineering
28.8
28.3
28.6
-2%
1%
Water Equipment and Chemicals
28.7
29.7
30.7
4%
4%
5.9
6.1
6.4
4%
4%
Air Pollution Control Equipment
15.5
15.7
16.5
1%
5%
Waste Management Equipment
11.4
11.8
12.1
4%
2%
2.0
2.0
2.1
1%
5%
Water Utilities
50.8
52.6
54.3
4%
3%
Resource Recovery
30.4
31.1
30.2
3%
-3%
Clean Energy Systems & Power
37.5
31.3
43.0
-17%
38%
TOTAL INDUSTRY:
343.0
345.1
364.6
1%
6%
TOTAL minus RR & Clean Energy
275.2
282.7
291.3
3%
3%
Instruments & Information Systems
Process & Prevention Technology
C&E: 4 Key Growth Factors in 2000s
ALL ++ in 2004-2008
Economic Growth: GDP growth drives environmental
markets.
Real Estate: Property Values drive development,
transactions, speculation, infill, brownfields.
Federal Markets: DOE and DOD budgets and accelerated
cleanup & closure; energy programs
Oil & Gas Prices; Commodity Prices: Record prices and
record profits by oil companies; same in Mining & Natural
Resources; Growth driving global development
Source: EBJ
C&E: Growth Factors into the 2010s: Policy?
GDP & Real Estate: Development, transactions, speculation,
infill, brownfields. Also M&A, stock market, capex investment.
Federal+S&L Markets: DOE/DOD/EPA budgets; cleanup &
closure; energy programs…. Cuts & sequestration
Oil & Gas: Record prices and record profits by oil
companies…. Fracking and North America renaissance;
Upstream, Midstream, Downstream… Exports? Price collapse
Commodity Prices: Mining & Resources; Energy, Water,
Food = Nexus… Up & Down
Environmental disasters to climate change: HW to Katrina
to BP to Sandy… Response to risk; Adaptation & Resiliency
Water & Wastewater: 36% of C&E revenues; stable-growth
Source: EBJ
Growth Factors: California Perspective
GDP & Real Estate: Plus compared to national
Federal+S&L Markets: Neutral to positive in S&L
Oil & Gas: Neutral to negative
Commodity Prices: Neutral
Environmental disasters to climate change: Neutral to
positive
Water & Wastewater: Neutral to positive; Water bonds
Policy & Programs: High-speed rail, Clean energy plan,
water, power, food; property taxes
Source: EBJ
Growth Factors: California Perspective
C&E Market by Media ($mil)
By Media
USA
Haz Waste/HazMat/IH/EHS
3,730
400
130
Remediation
5,480
730
270
Solid Waste
1,580
210
80
Wastewater
5,350
710
260
Water
4,950
660
240
700
90
30
Air Quality
2,230
300
110
Natural Resources
2,390
320
120
Renewable Energy
990
230
90
Multi-Media
1,380
180
70
Environmental Consulting & Engineering
28,780
3,830
1,420
Energy Mgmt/Efficiency
CA Total
NorCal Total
Growth Factors: California GHGs/Climate
4 bills in the California Senate 2015 package:
SB 32: State GHG reduction target of 80% below 1990 levels
by 2050. The current target, adopted by the legislature in
2006, requires statewide emissions to decline to 1990 levels
by 2020.
SB 350: 50% of our electricity from emissions-free
renewables, doubling energy efficiency, and reducing
petroleum in cars and trucks by 50% - all by 2030.
SB 189: Committee on economic growth and job creation.
SB 185 CalPERS and CalSTRS to divest coal companies.
IL: RE 35% by 2030; increase EE by 20%; CO2e auctions;
100k jobs
Growth Factors: California Water Bond
Aug. 2014: Legislature approved water bond ballot measure
aimed at increasing the supply of water and habitat.
November 4, 2014, voters approved Proposition 1 with $7.5
billion: $2.7 billion for water storage projects and $1.5 billion for
watershed protection and restoration projects. Also groundwater
sustainability, regional water management, water recycling and
desalination, water treatment, and flood protection.
Governor’s Budget Proposals. $533 million from Proposition
1 in 2015-16. This includes $178 million for various watershed
protection and restoration activities, $137 million for water
recycling and desalination projects, and $69 million for projects
to improve drinking water in disadvantaged communities.
Environmental Industry in Context:
Average Annual Growth Rate by Decade
70s
Analytical Services
80s
90s
00s
15%
21%
-1%
0%
Water Treatment Works
6%
5%
5%
5%
Solid Waste Management
6%
5%
5%
3%
Hazardous Waste Management
16%
28%
3%
1%
Remediation/Industrial Services
17%
22%
1%
2%
Consulting & Engineering
35%
25%
5%
5%
Water Equipment & Chemicals
16%
7%
4%
3%
Instruments & Information
14%
17%
8%
4%
Air Pollution Control Equipment
33%
10%
5%
-1%
Waste Management Equipment
9%
7%
2%
1%
14%
16%
14%
6%
5%
5%
4%
4%
Resource Recovery
11%
8%
2%
7%
Clean Energy Systems & Power
20%
3%
3%
20%
9%
8%
4%
4%
Process & Prevention Technology
Water Utilities
TOTALS
http://www.washingtonpost.com/wp-srv/special/politics/presidential-budget-2015/
12
EPA Budget for FY2015 shows erosion…
Cutbacks focused in infrastructure finance, state water revolving funds.
Dems lose
House in 2010
Source: EPA
Budget in Brief
13
DOD FY15 Proposal: Army on diet; Reform in QDR
Troops coming out for draw down; but baseline remains defended by Congress.
http://www.defenseindustrydaily.com
14
Industry Context
The
Green
Economy
Environmental
Industry
Climate
Change
Industry
2012-2103 Climate Change Industry ($bil)
USA
2012
USA
2013
2013
Growth
Global
2012
Global
2013
48.7
39.6
-19%
337.6
357.9
6%
11%
0.1
0.1
49%
0.4
0.6
36%
22%
55.8
57.3
2%
175.7
180.4
3%
32%
Energy Storage
3.8
4.7
17%
8.4
9.6
14%
49%
Green Buildings
68.2
76.7
14%
211.7
235.3
11%
33%
101.4
115.4
16%
555.5
594.2
7%
19%
Carbon Markets
1.8
2.1
37%
97.5
63.9
-34%
3%
Adaptation
0.6
0.7
14%
1.9
2.2
14%
33%
Research/C&E
3.4
3.3
1%
9.6
10.0
3%
33%
Climate Change Industry
284
300
15%
1,398
1,454
4%
21%
Low-Carbon Power
Carbon Capture & Storage
Energy Efficiency & DR
Transportation
2013
Growth
Source: Climate Change Business Journal; Environmental Business International, Inc., San Diego, Calif.
% USA
in 2013
Stock Market in 2014: Dow Jones IA Forecast
15-20%
2%
10-15%
9%
5-10%
33%
1-5% gain
27%
12%
flat or 1% to -1%
-1 to -5%
4%
-5 to -10%
11%
-10 to -15%
1%
-15 to -20%
1%
-20% or more
1%
Actual 2014: Dow
Jones IA was up 7.5%
0%
5%
10%
15%
20%
25%
30%
35%
Source: Environmental Business Journal 2014 Snapshot Survey; The Dow Jones Industrial Average
passed a previous October 2007 high point of 14,160 in February 2013, and has kept advancing to
around 16,500 in January 2014, or a 2013 gain of more than 20%. What percentage performance do
you predict for the DJIA in 2014?
Residential Property: When will we get back to
2006 peak value?
Never
2%
After 2018
31%
2018
17%
2017
20%
2016
19%
2015
2014
0%
10%
1%
5%
10%
15%
20%
25%
30%
35%
Source: Environmental Business Journal 2014 Snapshot Survey; Housing Prices: When do you think
average national US residential housing prices will get back to their Q2 2006 peak value? (Note: S&P
20-City Index bottomed out at 66% of the Q2 2006 average value in Q2 2009 and meandered between
66-70% until Q2 2012 before raising very steadily to end 2013 at 78% of Q2 2006 peak value.)
Oil Prices: When will crude hit $140/bbl again?
20%
Never
10%
31%
After 2018
21%
6%
6%
2018
2013 Survey
2017
6%
16%
2016
19%
17%
2015
2014
2014 Survey
11%
25%
0%
12%
0%
5%
10%
15%
20%
25%
30%
35%
Source: Environmental Business Journal 2014 Snapshot Survey; When do you think spot crude oil
prices will hit $140/barrel like they did in July 2008? (Note: 2010 prices were $75-90/barrel, 2011 $80100/barrel, 2012 $85-105/barrel and 2013 $100-120/barrel.)
When will the US institute a cap-and-trade
system similar to the EU-ETS or CA system?
25%
Never
23%
After 2018
2018
2017
14%
2%
3%
2%
4%
2013
2012
2011 results
7%
8%
7%
7%
7%
2014
2%
2%
37%
27%
5%
2016
2015
30%
5%
2012 results
2013 results
11%
11%
10%
21%
13%
10%
8%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Source: Environmental Business Journal 2012, 2012 and 2013 Snapshot Surveys; 2009 response:
13% said never; 2010: 25% said never.
US Carbon Policy Forecast
17%
Never
26%
22%
After 2024
9%
23%
2020-2024
13%
26%
2018-2020
32%
9%
2016-2018
13%
C&T
C tax
3%
2014-2016
7%
0%
5%
10%
15%
20%
25%
30%
35%
When do you think the United States will institute a carbon cap-and-trade system similar to the EU-ETS
system in Europe, or that being tested in California; and/or when do you think the U.S. will institute a
carbon tax or fee-for-emissions based system to restrict GHG emissions?
Coal: % of US Electricity Generation
60%
51%
50%
38%
40%
28%
30%
23%
19%
20%
15%
10%
0%
2003
2013
2020
2030
2040
2050
Source: Environmental Business Journal 2014 Snapshot Survey; Coal: U.S. DOE's Energy Information
Administration says coal was 51% of U.S. electricity generation in 2003, and was down to 37-38% in 2012
and 2013, largely on the growth of generation from renewables and natural gas. What percentage of U.S.
electricity generation do you believe coal will represent in 2020-2050?
Coal: % of China Electricity Generation
90%
81%
80%
78%
68%
70%
62%
60%
55%
49%
50%
40%
30%
20%
10%
0%
2007
2012
2020
2030
2040
2050
Source: Environmental Business Journal 2014 Snapshot Survey; Coal: International Energy Agency says
coal was 81% of China's electricity generation in 2007, and was down marginally to 78% in 2012. What
percentage of Chinese electricity generation do you believe coal will represent in 2020-2050?
AEO 2014 Latest Electricity Projection for 2020
Demand is down 3%; NGas takes 12-15pts of share from coal. Wind expands.
Total
4,400
4,500
267
4,000
6
270
3,500
Billion KWhs
2,500
2,000
3
290
754
571
601
16%
SolarPV
988
18
300
Wind
806
3,000
Total
4,525
24
94
255
AEO
2010
779
Geo
200
23
Biomass
170
Hydro
300
Nuclear
883
N.Gas
767
Petro
47
1,268
373
1,500
1,000
1,966
1,594
1,847
1,646
Coal
2093
500
0
1990
Source: EIA AEO 2014
2000
2010
2020p
24
U.S. Environmental Co. C&E Revenue
18.6%
United States
Non-US
81.4%
Source: Environmental Business International Inc., Annual model of the C&E industry
U.S. Env’l C&E Revenue: 1994-2014
20%
Int'l Revenue
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Source: Environmental Business International Inc., Annual model of the C&E industry
U.S. Env’l C&E Revenue: 2004-2014
30,000
USA
Non-US
25,000
3,030
20,000
2,600
3,360
3,830
4,560
4,010 4,290
4,910 5,280 5,670
2,810
15,000
10,000
18,080
22,500 23,250 22,010 22,310 23,010 23,870 23,060 22,940
21,070
19,540
5,000
0
2004
2005
2006
2007
2008
2009
2010
2011
2012
Source: Environmental Business International Inc., Annual model of the C&E industry
2013
2014
Distribution of Environmental Consulting &
Engineering Firms in 2012-2013 ($mil)
Size
Firms
Big 6 >1 bil
6
Net 2012
Net 2013
2013
Growth
8,540
7,762
-9.1%
Big 1 0 0 m-1 bil
44
10,503
10,322
-1.7%
Mid 2 0 -1 0 0 mil
132
4,427
4,600
3.9%
S 1 0 -2 0 mil
127
1,638
1,676
2.3%
S 5 -1 0 mil
190
1,233
1,340
8.6%
S 1 -5 mil
575
1,383
1,515
9.5%
S <1 mil
2 ,2 3 3
1,044
1,125
7.8%
Tot al
3 ,3 0 7
28,780
28,340
-1.5%
Source: Environmental Business Journal's annual model of the U.S. environmental consulting &
engineering industry based on annual surveys of C&E firms by EBJ, EBJ interviews, compiled revenue
data derived from various sources including ENR, EFCG, ZweigWhite and public company data.
Volume XXVI: EBJ in 2013
EBJ Vol XXVI No 12: The U.S. Water Industry
EBJ Vol XXVI No 10 & 11: Environmental C&E Industry Review
EBJ Vol XXVI No 9: M&A 2013
EBJ Vol XXVI No 7/8: Environmental Industry Overview 2013
EBJ Vol XXVI No 5/6: Corp.Sustainability and Sustainability Consulting
EBJ Vol XXVI No 4: Remediation 2013
EBJ Vol XXVI No 3: Outlook 2013: EBJ Snapshot Survey 2013
EBJ Vol XXVI No 2: Future of Fracking: Unconventional Oil & Gas E&P
EBJ Vol XXVI No 1: Executive Q&As and 2012 EBJ Awards
Volume XXVI: EBJ in 2014
EBJ Vol XXVII No 12: Executive Q&As and 2014 EBJ Awards
EBJ Vol XXVII No 11: Consulting & Engineering 2014
EBJ Vol XXVII No 10: Environmental Contracting Services 2014
EBJ Vol XXVII No 8/9: Environmental Industry Overview 2014
EBJ Vol XXVII No 6/7: Global Environmental Markets 2014
EBJ Vol XXVII No 4/5: Natural Resource Management Markets 2014
EBJ Vol XXVII No 3: Outlook 2014: EBJ Snapshot Survey
EBJ Vol XXVII No 2: Air Pollution Control
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•2014 Executive Review & 2013 CCBJ Awards (December 2013)
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•Climate Risk Assessment and Adaptation Markets (Q1 2014)
Climate Change Industry Leaders ($bil in CCI)
Company
Global CCI
Revenues
1 Siemens AG
25920
2 GE
18460
3 Johnson Controls Inc.
12100
4 Toyota Motor Co.
11500
5 Vestas
7680
6 Alstom
7200
7 Honeywell International
6590
8 Schneider Electric
6530
9 ABB
5700
10 Mitsubishi Heavy Industries
5600
11 Enercon
5200
12 Sinovel
4920
Source: EBI Inc., San Diego, Calif.
34
March 11-13, 2015 - 13th Anniversary
Solamar Hotel, Gaslamp District, San Diego
Grant Ferrier
President, Environmental Business International, Inc.
Chairman, Environmental Industry Summit
Editor, Environmental Business Journal
Editor, Climate Change Business Journal
4452 Park Blvd. #306, San Diego CA 92116, 619-295-7685 ext.15
[email protected]; [email protected]
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