Efforts by America’s Utilities to Keep the Power On and the Water Clean Spell Abundant Opportunity for Savvy Vendors

by Bill Culhane

Utilities across the U.S. are in crisis. The reasons are many. The main ones:

  • Antiquated infrastructure
  • Overly burdensome governmental regulations
  • Skilled-worker attrition due to workforce aging
  • Difficulty integrating renewable energy sources
  • Complexities of integrating IT/OT solutions

LISTEN as, Brian Pallasch, formerly of the American Society of Civil Engineers (ASCE), explains how bad things have gotten for America’s infrastructure, to include utilities.

Consider too this dire assessment and ominous prediction issued four years ago by the U.S. Department of Energy in its Quadrennial Technology Review 2015:

"In addition to the rapidly changing landscape of power flows and physical phenomena that grid components need to accommodate, the age of some grid components is increasing the urgency for solutions.

Currently, 70% of power transformers are 25 years or older, 60% of circuit breakers are 30 years or older, and 70% of transmission lines are 25 years or older.

The age of these components degrades their ability to withstand physical stresses and can result in higher failure rates. Failure of key grid components can lead to widespread outages and long recovery times. This situation represents a high loss of revenue for utility companies and for customers who require power to do business and provide services. Consequently, appropriate maintenance of power system equipment is of significant importance. For instance, a single power transformer that is damaged can temporarily disrupt power to the equivalent of 500,000 homes, and it can take up to two years to manufacture a replacement.

Moreover, power outages from weather-related events and other causes are estimated to cost the United States $28–$169 billion annually.”

You might find all that hard to accept. However, on this point we surely can agree: the crisis in which utilities are embroiled must be met head-on. The consequences of failure to take steps to resolve the problems besetting the utilities industry are potentially quite dire indeed. Many are heeding the call to action, as evidenced by the billions of dollars now allocated and being spent on electric grid repairs, water pipeline improvements, new facilities construction, systems modernization, and research and development of cleaner, safer sources of sustainable energy.

In this report, we explore the general state of utility services in the U.S. As is so often true of our assessments, we ask in this one if enough of the right actions are being taken to make a difference. We think the answer is: perhaps.

For example, a positive step initiated near the end of 2018 by the U.S. Department of Agriculture saw $1.6 billion allocated among 46 rural electric utility infrastructure projects. Moreover, leaders in municipalities around the nation are increasingly showing themselves to be open to collaborating with the federal government on utilities projects, even though those local officials have access to various other resources closer to home for funding their sorely needed projects.

Before we delve deeper, it is worth mentioning that all utility services are vital—water, electricity, gas, waste removal, waste treatment. Also, it matters not whether those services are provided by a private-sector company or a public entity. The fact is, life as we know it depends on that which utilities deliver.

Water & Sewer

The quest for clean water has two prongs. The first is water safe for human consumption. The second is water safe for consumption by vegetation and wildlife. Both prongs require effective, cost-efficient products, services, and solutions from the vendor community.

Needed by water utilities (which include those that deliver H 2 O to the tap and those that take care of sewage) are items that support collection, treatment, storage, and distribution of water. Their need is pressing because the water infrastructure is growing older and becoming less stable.

In 2009, the then-newly authorized American Recovery and Reinvestment Act made money available to put the first real dent in the problem, albeit only a slight dent. However, as Pallasch pointed out, water pipelines installed decades ago are now leaking and breaking at such an alarming rate that much more than the $200 billion in ARRA funds allocated last year (2018) will be required.

LISTEN as Avon Lake Regional Water executive, Todd Danielson, recently visited 'The Big Bid Theory' and touched upon numerous clean-water topics.

Sample Active Bids/RFPs

Water Treatment

Communities far and wide deal with sewage in ways that range from septic tanks to biofilters (also known as constructed wetlands). The process of removing contaminants from sewage so that the liquid remaining qualifies as safe for discharge to the environment or for non-potable reuse is one that requires an abundance of specialized equipment, support systems, and consumables (mainly chemicals)—all of which are subject to long lists of laws, rules, and regulations.

Meanwhile, the graphic below shows that government entities across the U.S. are investing heavily in the collection, treatment, and disposal of waste, both domestic and sanitary sewage. The graphic suggests that it will take a very large pond full of money pay for installation and maintenance of just the elaborate maze of pipes to collect, treat, and dispose of sewage.

Sample Active Bids/RFPs

Sewer

Electricity

The electricity distribution network consists of powerplants, substations, transformers, sensors, and pole-mounted or underground wires.

Together, they bring reliable energy to homes, businesses, and other destinations sometimes hundreds of miles away from the source. This network is vast indeed. As noted earlier, parts of this network are more than a century old, with fully 70 percent of the U.S.’s transmission lines and power transformers at least 25 years old (the average age of American powerplants is 30+ years).

Today’s electricity needs are massive and diverse. As a result, the strain placed on the grid is greater than ever. With that in mind, we conducted a Market Analysis of U.S. government bid/RFP activity for services and solutions related to the production and distribution of electricity (see below)—and, like many—we have come to the obvious conclusion that major remedial action is overdue. Some action is being undertaken, but there remains much, much more to do.

Sample Active Bids/RFPs

Electricity

The advantages of having modern, robust, effective utilities infrastructure are obvious. Unfortunately, America does not currently possess such an infrastructure. Fortunately, governments at all levels around the country are recognizing the need to bring their utilities systems into the 21st Century. Toward that end, they are committed to each year spending billions of dollars. As a vendor, are you and your business ready to scoop up a piece of that pie?

For a Market Analysis on the bid/RFP activity of various utilities, or to review their solicitations and documents, please visit BidPrime, call 888.808.5356, or email us at support@bidprime.com.