Update: Expanding on Details (forward-looking)
Last Friday, International Wastewater Systems Inc. (“IWS”) has announced a strategic alliance with Scottish Water Horizons Ltd., the commercial subsidiary of Scottish Water, a public water utility owned 100% by the Scottish Government.
Also on Friday, Scotland’s national newspaper The Herald called IWS "a Canadian renewables giant". From a strict market capitalization perspective (currently at $44 million CAD), IWS is not really a "giant" (yet), but let´s take a look at the market potential as Scottish Water Horizons has estimated that up to 750 SHARC systems are needed to be installed to enable Scotland to achieve its carbon savings targets by 2020.
One SHARC system has already been installed successfully at the Borders College in Scotland, at costs estimated at $1.7 million CAD. If 750 such systems are to be installed in Scotland within the next 4 years, the market potential for IWS translates into a massive $1.3 billion CAD opportunity. This figure excludes any potential revenue sharing and cash distributions between IWS and Scottish Water from the heat and energy sales agreements that can be generated from such projects, which typically run for >20 years. The Borders College project has a revenue sharing agreement in place whereby IWS earns its share of revenue from heat sales to Borders College over the life of the project.
The IWS press-release disclosed that Scottish Water Horizons and IWS have collaborated for over 2 years, resulting in an identified pipeline of projects valued at £20 million GBP ($32.4 million CAD). From this it’s clear that Scottish Water Horizons and IWS are already executing against their ambitious goal of 750 SHARC systems; this is not simply a ‘blue sky’ target.
IWS may be a growth stage company but it’s already executing a >$1 billion dollar mandate with a world-class, national water utility in Scottish Water. And Scotland is only one, relatively small market (population of 5.3 million) when considering the global potential for the IWS technology.
In August 2016, IWS announceda $80 million CAD joint venture with RENEW Energy Partners LLC, a US-based clean energy developer and funding company committed to finance capital expenditures for 1,000 PIRANHA systems from IWS to be installed in California. Therefore, a single PIRANHA system installation averages about $80,000 CAD.
PIRANHAis a small, self-contained water heating system with a capacity of up to 100 kW, designed to be an easy to install "plug and play" system for commercial and 50-200 unit residential applications.
SHARC is a large, custom-designed water heating and space conditioning system with a capacity of 440-880 kW (source), which can be scaled to serve large district heating networks by adding multiple SHARCs. SHARC installations are individually designed and engineered for industrial, commercial and >200 unit residential applications. Thus, the price for a single SHARC system is much higher than a PIRANHA (also due to customized engineering on site), whereas the PIRANHA module can be shipped in a container to be installed easily on site with less engineering.
Federal and state grants totalling $1.3 million USD (1.7 million CAD) were made available to install a single SHARC system at the Camden Municipal Wastewater Treatment Plant in New Jersey, USA (source):
Susan Rice, Chair of Scottish Water, gave the following statement in the company´s Annual Report and Accounts 2015/2016:
"In 2015/16, we also commenced a 6 year, £3.5 billion investment programme which will see further improvements to water and waste water infrastructure around Scotland, improving drinking water quality, enhancing the environment and supporting jobs in the Scottish economy."
Rockstone is looking forward to the release of further information from IWS and its alliance with Scottish Water Horizons, as they continue to execute on a billion dollar opportunity in Scotland over the next few years, which indeed would make IWS "a renewables giant" in due course.
Disclaimer: IWS has not reviewed this content prior to publication and may not agree to the statements made herein. Please read the full disclaimer here.
Report #2 (Friday, October 14, 2016):
Strategic Government Alliance to install up to 750 IWS systems enabling Scotland to achieve its carbon savings targets by 2020
Today, the green energy tech company International Wastewater Systems Inc. (“IWS”) announced that its wholly owned subsidiary SHARC Energy Systems (UK) Ltd. will form a strategic alliance with Scottish Water Horizons Ltd., the commercial subsidiary of Scottish Water, a public water utility owned 100% by the Scottish Government.
This strategic alliance will support the Scottish Government’s ambitious renewable heat and carbon reduction targets for 2020. It is the result of 2 years of informal collaboration between SHARC Energy and Scottish Water Horizons, which has created a £20 million GBP ($32.4 million CAD) pipeline of potential installations across Scotland that when deployed would generate 170 GWHs per year of heating and cooling to displace the fossil fuel currently used.
Scottish Water Horizons has estimated that up to 750 such systems would need to be installed by 2020 to enable Scotland to achieve its carbon savings targets.
In late August 2016, IWS announced a $60 million USD joint venture with RENEW Energy Partners LLC, a US-based clean energy developer and funding company committed to finance capital expenditures for 1,000 PIRANHA systems from IWS to be installed in California. Following this announcement, IWS’ stock surged from $0.25 to $0.59 CAD and is currently trading at $0.45 CAD with a market capitalization of $40 million CAD.
With now 2 large commercial projects in the US and Scotland, up to 1,750 IWS systems could be installed over the next few years to generate revenues in excess of $110 million CAD.
Today’s announced strategic alliance, and the August announced joint venture, could become the blueprint for other renewable energy companies, funds, organizations and governments to follow the same path to reduce energy costs up to 80% for residential and industrial buildings worldwide. Such a funding and revenue sharing model is also attractive because of its longevity, typically running for more than 20 years while paypack periods for individual installments are a few years only (depending on flow rates, local electricity costs, etc. and will vary with each project).
The SHARC thermal heat recovery system developed by IWS has been deployed in numerous international locations, intercepts wastewater from sewers and uses heat pump technology to amplify the natural warmth of waste water. This generates an energy-saving, cost-effective and environmentally-friendly system for heating, cooling and hot water production in commercial, residential and industrial buildings.
Scottish Water Horizons is mandated to drive Scottish Water’s green agenda, developing renewable energy projects and leveraging commercial value from Scottish Water’s assets to contribute to a greener and better connected Scotland. Scottish Water Horizons and SHARC Energy are joining forces to help businesses and public organizations reduce heating costs and carbon emissions. The companies have confirmed their intention to establish a strategic alliance to expand and accelerate the deployment of Sewage Heat Recovery systems around Scotland.
Scottish Water serves approximately 5 million residential customers and 150,000 business customers in Scotland, and is the sole provider of water and waste water services to an area of over 30,000 square miles, a third of the area of Britain. Scotland has a coastline of over 6,800 miles, with a small and relatively dispersed population which requires a large number of small water and waste water treatment plants. Every day Scottish Water supplies 1.34 billion litres of drinking water and takes away 847 million litres of waste water from customers and treats it before returning it to the environment.
Commenting on the announcement, Andrew Macdonald, Head of Scottish Water Horizons, said:
“The potential to deploy this technology is significant. Heat accounts for over half of Scotland’s total energy use and we believe that by harnessing the natural resources of our vast waste water network, we can further the development of Scotland’s low carbon economy, whilst protecting and enhancing the environment. Scottish Water treats over 900 million litres of waste water every year and we are determined to maximise the opportunities presented. Our alliance with SHARC Energy is an exciting opportunity which will help to accelerate the deployment of this proven technology on a wider scale, providing customers with an innovative and sustainable lower cost heating solution.”
Commenting on the announcement, Russ Burton, COO of IWS, said:
“This announcement is a very exciting step for SHARC Energy and IWS and represents the culmination of two and a half years working with Scottish Water Horizons to identify opportunities for the SHARC technology. Having the support from Scottish Water Horizons will give customers the confidence in the SHARC technology, positioning it as a sustainable and viable wastewater heat recovery solution.”
Lynn Mueller, CEO of IWS, commented:
“IWS’s strategic alliance with Scottish water is a significant milestone for our Company and demonstrates how far we have come in a very short space of time. We are delighted to be partnering with one of the world’s leading water utility operations. This achievement truly is indicative of the scale of the opportunity we have uncovered.”
Today’s announced strategic alliance follows the launch of the UK’s first sewage heat recovery system, developed by SHARC Energy at Borders College in Galashiels, Scotland (approximately 5,500 students) which aims to displace 1.8 GWhs of natural gas and save 150 t of carbon emissions per year. The innovative SHARC system had been examined by the University of Glasgow in a case study involving the Borders College, with the following results:
• The use of this technology provides for the sustainable development.
• This project estimated reduction of CO2 emissions is around 140 tonnes/year.
• The monetary savings by the college per year sums up to around £10,000 per year on their bills for heating by using SHARC system in comparison to use of gas boilers for heating of the buildings.
UK Green Investment Bank plc (GIB) and the Equitix Energy Efficiency Fund invested £4 million into the SHARC technology for the pilot project Borders College, whereupon Lord Smith of Kelvin (Chairman of GIB) commented in June 2015:
“Our 50th investment neatly sums up what we are trying to achieve at GIB. We are backing the deployment of innovative new technology across the UK to produce renewable energy, cut energy use, cut costs and improve the UK’s green performance. It is enabling SHARC Energy systems to equip Borders College with pioneering technology in an arrangement that I hope can be replicated elsewhere in the country.”
Scottish Water signs heat recovery alliance
By Scott Wright, Deputy Business Editor at HeraldScotland on October 14, 2016
A SUBSIDIARY of utility Scottish Water has joined forces with a Canadian renewables giant to help firms and public bodies reduce their heating costs and carbon emissions.
Scottish Water Horizons has formed an alliance with Vancouver-based International Wastewater Systems to accelerate the deployment of sewage heat recovery systems around the country.
It follows the launch of the UK’s first sewage heat recovery (SHR) system at Borders College in Galashiels. Developed by SHARC Energy Systems, a subsidiary of the listed Canadian business, it aims to displace 1.8 gigawatt hours of natural gas and save 150 tonnes of carbon emissions a year.
The system, which has been deployed at several locations, works by heating the waste water from sewers with heat pump technology to amplify the natural warmth of waste water.
It is highlighted by its backers as a cost-effective and energy saving method for heating, cooling and producing hot water in commercial and residential buildings.
The alliance follows two years of formal collaboration between Scottish Water Horizons and SHARC, which they say has led to a £20 million pipeline for potential installations around Scotland.
Scottish Water Horizons said up to 750 systems would have to be installed by 2020 to enable Scotland to meet its carbon savings targets.
Andrew Macdonald, head of Scottish Water Horizons, said:
“The potential to deploy this technology is significant. Heat accounts for more than half of Scotland’s total energy use and we believe that by harnessing the natural resources of our vast waste water network, we can further the development of Scotland’s low carbon economy, whilst protecting and enhancing the environment.”
Wastewater Energy Recovery: It’s time to put to use the hot water from the sewer
By Jay Egg for PlumbingEngineer on October 7, 2016
There are a lot of great ideas for saving energy, but first cost is usually a limiting factor for our customers. One of those has to do with wastewater energy recovery. I doubt that I’m alone when I have wondered about all of the hot water (and energy) running down the drain from the shower/bathtub, washing machine, dishwasher and other fixtures and drains in the house.
Lynn Mueller of International Wastewater Systems Inc. (IWS) has been involved in geothermal heat pump systems for some 30 years. It was only a matter of time until he attached one to a plate and frame exchanger and made his own wastewater thermal extraction system. Maybe no one else would tackle the effort, but it’s a technology that has come of age. Mueller did well, and his company went public last year and continues to expand. It won the AHR 2016 Green Building Product of the Year with the newly released PIRANHA heat recovery system.
California is getting one thousand (1,000) PIRANHA thermal heat recovery systems, thanks to a joint venture between International Wastewater Systems Inc. and RENEW Energy Partners LLC. The PIRANHA is designed to provide for the domestic hot water (DHW) needs in multi-family housing from 50 to 200 units.
According to the DOE, 350 billion kWh of usable energy goes down the drain each year. That is enough energy to heat 5 billion average sized homes in the dead of winter for an entire day (24 hours) or, heat 69 billion DHW tanks up from room temperature to 130 F. This is a remarkably large quantity of energy that is not being recovered.
Just as heat pump water heaters have been proven to be a great way to save energy on DHW bills, energy recovery with wastewater takes this concept to the next level. With a heat pump water heater, the compressor normally sits atop the tank and extracts heat from the air in the garage, or wherever it happens to be located. The by-product is chilled air, because the heat has been pulled out of the air stream and placed in the DHW tank. Essentially, the PIRANHA does the same thing with the wastewater that runs down the drain, recovering unused energy for other purposes such as DHW, heating or cooling; but the potential exists to save quite a bit more energy with wastewater than just air-exchange alone.
In Vancouver, Canada, the city built a wastewater energy plant to displace natural gas (NG) heating, and they are convinced that through the use of geothermal heat pumps (GHPs) and some smart strategies, they can meet their goals. This article has an example of a large wastewater heat recovery system and a video interview with Brian Crowe, Director of Water, Sewers and District Energy for Vancouver (a must see). Incidentally, Vancouver is Lynn Mueller’s hometown.
The PIRANHA thermal heat recovery systems that are going into California are the entry level portion of this technology, recovering energy primarily for DHW needs. Another product of IWS introduced some years ago is the SHARC, having more applications, such as cooling and heating for residential, commercial and district applications. This is the junction at which wastewater heat recovery and mechanical professionals become fully engaged. There will soon be buildings and designs crossing our collective desks with these waste energy recovery systems in the design, and they’ll be a big part of the plumbing and HVAC systems.
I spoke with Mueller recently, and he has some exciting things coming up. In the near future, IWS will be introducing a residential level wastewater energy recovery unit. This is another opportunity to help customers become more sustainable, save money and increase the profits for plumbing and HVAC professionals. Mueller told me that IWS is seeking professionals and companies that wish to be trained on this technology. Just give them a call.
GHPs are integral components of this technology. Unlike the air-source type, GHPs are the central component of the thermal extraction/rejection portion of energy recovery. GHPs use available energy in liquids between 25 F and 110 F and are able to absorb and reject heat to/from them. GHPs are “thermal energy pumps,” concentrating heat energy through the “Carnot Cycle,” delivering final temperatures from well below freezing to 140+ for uses such as space conditioning, refrigeration, or domestic hot water.
Of course, these applications are well suited to be a hybrid of waste energy (as the primary source/sink) and earth coupled systems. The earth coupled portion of projects is reduced in both scope and cost by taking advantage of the wastewater thermal energy heat source and sink.
Hydronic systems are amazing because they effectively channel BTUs within a pipeline, unlike air source systems. GHPs make the magic happen, by simply managing BTUs entrained in liquids to whatever temperature is needed at the time. GHPs are the “center of the energy universe” for renewable and sustainable energy systems.
Technologies that reduce greenhouse gas (GHG) emissions are in high demand; and wastewater energy recovery has a great potential to reduce GHG emissions and save energy in buildings of all kinds. This is a technology whose time has come.
Jay Egg is a geothermal consultant, writer, and the owner of EggGeothermal. He has co-authored two textbooks on geothermal HVAC systems published by McGraw-Hill Professional. He can be reached at jayegg.geo@gmail.com.
Recovering Heat from Waste Water
From the website of Scottish Water Horizons Ltd.
We are opening up Scottish Water’s networks to extract renewable heat from waste water.
Scottish Water has a vast infrastructure including 32,000 miles of sewers which carry waste water from homes and businesses to around 1,800 treatment works across Scotland.
We are harnessing these networks to support innovation, growth and the development of a sustainable low carbon economy.
Innovative heat recovery technology
Working with our external partner SHARC Energy Systems, we are deploying innovative heat recovery technology in waste water networks to capture heat for use as a renewable energy source.
Already employed in Canada, the technology involves the use of a heat exchanger to extract energy from waste water and transfer it as heat to the clean water network. This provides heating, cooling and hot water for export to nearby homes and buildings. As the technology uses a closed-loop system, waste water never comes into contact with the clean water flow.
With versatile application, the technology can be installed within a wide range of buildings, either as a retro-fit or as part of a new-build, and is particularly suited for locations with a large number of people within a relatively small area.
Find out how the process works.
A first in the UK
Already we have helped to install the UK’s first waste water heat recovery scheme at Scottish Borders college campus in Galashiels. Up 95% of the college’s heating needs can be now be met through use of the technology, producing savings in energy, costs and carbon emissions.
“Borders College is delighted to be the client in this project which places us at the forefront of renewable energy use in the UK. This solution goes a long way to meeting our own carbon-reduction targets, while offering long-term price certainty and offering a good degree of local control.” (Pete Smith, Vice Principal - Finance and Resources at Borders College)
Read our press release.
Providing a sustainable heating alternative
By recovering heat that would otherwise have been discharged to the environment, we are helping to provide customers with an innovative and sustainable lower cost heating solution with a reduced carbon impact. With tens of thousands of miles of waste water pipes throughout Scotland, we are actively exploring the potential for this new approach to be replicated at other locations. Not only does this help contribute to a sustainable circular economy, it also helps to alleviate fuel poverty, meet Scottish Government’s target of 11% of heating from renewable sources by 2020, and tackle the threat posed by climate change.
Download our brochure.
Get in touch
To find out if your business could benefit from renewable heat technology contact Ian Dunsmore on 07875 872312 or email Ian.Dunsmore@scottishwater.co.uk
About Scottish Water
Scottish Water provides clear fresh drinking water to 2.46 million households and 150,000 business premises across Scotland. Every day, Scottish Water also takes away 921 million litres of waste water, which is treated before being safely returned to the environment. In recent years, Scottish Water has been working to build an increasingly sustainable business.
Scottish Water Horizons Ltd. is a commercial subsidiary wholly owned by Scottish Water. The company plays a key role in supporting the development of Scotland’s sustainable and circular economy by making the most of the public utility’s vast array of assets. From generating renewable energy from waste, wind and solar power to recycling food and aggregates waste, Scottish Water Horizons is improving connections, communications and enabling sustainable development. The company’s growth strategy is to support Scotland as a developing Hydro Nation and take opportunities to harness Scottish Water’s asset base through both its own development and working in partnership with other organisations including the public and private sectors.
About International Wastewater Systems Inc.
International Wastewater Systems Inc. (and its wholly owned subsidiary SHARC Energy Systems (UK) Ltd.) is a world leader in thermal heat recovery. IWS systems recycle thermal energy from wastewater, generating the most energy efficient and economical systems for heating, cooling & hot water for commercial, residential and industrial buildings. IWS is publicly traded in Canada (CSE: IWS), the United States (OTC: INTWF) and Germany (Frankfurt: IWI).
Company Details
International Wastewater Systems Inc.
1443 Spitfire Place
Port Coquitlam, BC, V3C6L4 Canada
Phone: +1 604 475 7710
Email: yaron.conforti@iws-sharc.com (CFO)
Web: www.sewageheatrecovery.com
Shares Issued & Outstanding: 89,340,000
Canadian Symbol (CSE): IWS
Current Price: $0.45 CAD (October 13, 2016)
Market Capitalization: $40 million CAD
German Symbol / WKN (Frankfurt): IWI / A14233
Current Price: €0.29 EUR (October 14, 2016)
Market Capitalization: €26 million EUR
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