The Canadian province of Ontario is one of the leading locations around the world in terms of the active support given to help grow water sector-related businesses. WaterTAP, co-host of the World Water-Tech North America event in October, is the sector champion set up to lead this support. Keith Hayward spoke with CEO Peter Gallant about his first year in the role and plans to stimulate greater innovation in the sector.
‘I’m actually delighted with how the first year went,’ comments Dr Peter Gallant, CEO of WaterTAP, speaking not long after marking his first anniversary heading the Canadian province of Ontario’s flagship initiative to support growth of the water sector there.
WaterTAP was created by the 2010 Water Opportunities Act and has been in operation since 2012, initially led by Dr Brian Mergelas. Gallant had in fact been a WaterTAP board member during this time, offering input as someone running a water technology business. ‘My previous company provided automatic bacteria detection, which we sold to Veolia,’ Gallant notes.
This means Gallant is well equipped to ensure WaterTAP, or the Water Technology Acceleration Project, continues to build on its success of helping support the water sector in Ontario. ‘I’d seen first-hand the challenges of developing fundamentally innovative and disruptive new technologies and introducing them into the water sector,’ he says.
Facing up to familiar challenges
One of the biggest challenges technology providers face is of how to sustain a business between the early phase of start-up and first orders and the growth phase when orders start to flow. In other words, how to survive the much talked-about valley of death. ‘I’ve not only fallen into the valley of death myself a couple of times, I’ve also seen other people who had tried to develop early stage water technology companies fall into it,’ says Gallant.
This represents a particular challenge for the water sector, Gallant believes. ‘Unlike other industries, the water sector has a valley of death that is potentially longer and deeper,’ he says. There are good reasons for this, given the public health and public safety issues involved, and it means the typical ‘hockey stick’ revenue projections for growth in other sectors may not apply.
‘The good news about that though is, once you get a technology through this process, get it approved, and you start getting those critical first customer references, you can build a technology that’s there for decades and the revenue is there for decades,’ adds Gallant. ‘You can build a very valuable business, but you do it under timescales and revenue growth rates that are significantly different to other sectors of the economy.’
Support suited to the sector
This context has shaped the latest activities at WaterTAP. ‘We introduced two major initiatives in the last year that I am absolutely delighted about,’ says Gallant. One is to provide direct assistance to companies, providing advice to their specific situation. The other is to work on the regulatory side of the sector to try to reshape how innovative technologies can be introduced.
The direct assistance goes beyond generic programmes in areas such as marketing and allows companies to benefit from the knowledge within the WaterTAP team – a knowledge that continues to grow through working with clients. ‘I’d stack up our team against anybody on the planet in terms of our expertise in the water sector,’ comments Gallant.
The advice given to small companies is subsidised by funding provided by the province, while large companies have also engaged WaterTAP, paying market rates. Gallant notes that the specific expertise of the team means similar advice is only available to a limited extent from private organisations. Even so, WaterTAP takes steps to avoid being seen to be in competition with the private sector. ‘We have the client self-certify that they’ve actually searched for sources of private sector support and in fact are only accepted into the programme if they didn’t find it out in the private sector,’ he says, adding: ‘It’s very unique stuff.’
The work on the regulatory side aims to address two issues in particular. One, that each regulatory jurisdiction generally requires its own set of data where approvals are needed for a technology to be deployed. ‘Imagine that every time you want to go and sell into a new jurisdiction, you need to address some of their unique regulatory situations. How do we harmonise that? How do we start to remove some of the regulatory barriers where a technology that gets into one state can’t get into the adjacent state?’ asks Gallant. And second, the contract tendering processes of municipalities can require the submission of multiple bids, which can act as a barrier to innovation. ‘If you have to go and get five bids for a new technology, that means five vendors actually have this technology. How unique and innovative is it if five vendors already have it?’ he adds.
WaterTAP has secured additional funding from the province to build on government activity and initiate a major policy exercise in this area. The aim is to address barriers to innovation and growth in the sector and WaterTAP is just now bringing a coordinator on board to lead this. ‘It is an initiative around finding alternative regulatory and procurement pathways that both protect public health, yet also enable and encourage the use of innovative technologies,’ says Gallant. The intention is that this will contribute further to the success of companies in Ontario. ‘Imagine what you could do to enhance the ability of your companies to innovate in your jurisdiction if you could work with government to address those barriers and get your own technologies in the ground in your own backyard,’ he adds.
Leading the way in the year ahead
Gallant is confident about the quality and innovation that WaterTAP is bringing to its task compared to other such initiatives around the world. ‘I honestly think we’re breaking some new ground,’ he says. ‘I believe and can state that I think we’re the leaders in this area.’
In terms of progressing the work on regulatory barriers, Gallant explains that a roadmap with early, ‘low-hanging fruit’ options right through to longer term opportunities has been identified. In the longer term in particular, there are some very different approvals models that could be adopted, and WaterTAP brings a valuable perspective to this. ‘We can bring the benefit of having a global view of how others are dealing with regulation and moving away from regulatory approvals that, for example, are technology specific and site specific,’ he says. The province itself has already made progress in this area. ‘There is still more to be done in the longer term,’ Gallant adds.
On the procurement side, Gallant sees there are opportunities to look at aspects such as life cycle costs and at carbon footprints. Failure to look at these during procurement may represent a built in bias towards conventional treatment systems, he explains.
The task now is to make tangible progress in both of these areas. ‘My first year in office was measured on managing transition and recasting the priorities of the organisation around direct assistance and the barrier reduction initiative,’ says Gallant. ‘The next year is all going to be about success stories – how does WaterTAP actually contribute to the successes of the sector itself and the individual companies within that sector?’
Alongside this, Gallant will be working to ensure WaterTAP becomes less dependent upon funding from the province, instead generating funding from the value it brings through activities such as the direct assistance. ‘We’re going to have more of a diversified revenue base that makes the funding situation for WaterTAP more sustainable and less dependent strictly on government funding,’ he says.
This year ahead will include WaterTAP’s partnering of the World Water-Tech North America event in October. ‘We value that relationship with World Water-Tech. It’s well attended by influential decision makers and investors in the water sector,’ Gallant comments.
He points out also that this year’s event will take place during what will be the first Ontario Water Innovation Week. This will include a further conference, Water Innovation in Action, with WaterTAP hosting both this and the week as a whole.
‘I think all the major elements of what needs to happen in water innovation are going to come together in that week,’ says Gallant. It will bring together operators, technology providers, investors and policy people, covering areas such as renewal of ageing infrastructure, water’s role in the low carbon economy, and the water-related challenges of small and remote communities.
‘It's going to take the dialogue around innovation in water to a whole new level,’ says Gallant.
- innovation, Canada, WaterTAP