|Last Quarterly Update:||11/25/2013|
|SIC Codes:||4941, 4952|
|Industry Overview||Trends & Challenges||Industry Forecast|
|Quarterly Industry Update||Call Prep Questions||Website & Media Links|
|Business Challenges||Financial Information||Glossary & Acronyms|
Companies in this industry operate water treatment and water supply systems; they also operate sewer systems and sewage treatment facilities. Major companies include American Water Works, Aqua America, and California Water Service (all based in the US), along with France-based global giants SUEZ Environnement and Veolia Environnement.
The US commercial water and sewer utilities industry includes about 5,000 companies with combined annual revenue of about $10 billion. Demand drivers include economic activity and population growth.
The commercial industry is small compared to the water and sewer services operated by many regional and local governments in the US. Government-owned water and sewer utility services earn about $110 billion annually.
Demand depends on commercial and residential water needs, which are related to population growth and to the level of economic activity. The profitability of individual companies depends on efficiency of operations, because prices are fixed by public utility commissions (PUCs). Large companies have economies of scale in operations and the ability to raise capital for infrastructure improvements. Small companies can compete successfully through superior engineering or by serving smaller local markets. High barriers to entry, such as capital investments, make the industry somewhat resistant to competition; many companies operate as de facto monopolies.
The US industry is concentrated: the 50 largest US companies account for 65 percent of industry revenue.
PRODUCTS, OPERATIONS & TECHNOLOGY
Water services account for 70 percent of industry revenue, sewer services for 13 ...
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