The feasibility study aimed at establishing a duality problem-solution related with the development and commercialization of a water saving technology within the residencial and tertiary sectors, named “NESS-SW”.
Métrica6, the company executing this study, is an R&D company specialised in the development of innovative products and technologies like NESS-SW, whose first version, avoids the wastage of cold water generated every time an user has to wait for hot water. This initial solution evolves through the report towards an integral control and management tool for hot water supply.
For the study, we made the following research:
a. Market approach in macroeconomic terms for several sectors: construction, water, smart home, smart water, sustainable building and Internet Of Things (IOT).
b. In-depth analysis of British and German markets, its regulation and marketing strategy. Those markets were selected from previous analyses by Métrica6, prooving its high potential due to their national cultural, economic and environmental strategies.
c. Development roadmap.
d. Conclusions and future lines of action.
According to the goals established in the initial proposal, the project shall continue with the updated and better-defined strategy set up in this feasibility study. Back in the application, Métrica6 had an innovative technology to develop internationally, but lacked of precise information of the countries to first deliver it. Focusing the study in UK and Germany (apart from Spain, where the basic NESS® technology is being commercialised since 2015), Métrica6 found the information needed to develop the international development roadmap to create and commercialise NESS-SW technology in these three countries at first, and then, with the experience gained, continue the expansion towards the rest of Europe and abroad.
One of the goals of this feasibility study was to identify barriers within the markets Métrica6 expects to access to. Regarding the UK market, Métrica6 has found that for a smart network to become operational in the UK, a number of substantial barriers such as the fragmentation of the sector, slow adoption of new technologies, no holistic vision being set out for the sector, and lack of SME development needs to be overcome. Some of the obstacles in this sector are the time and economic costs undergone by SMEs to carry out full scale testing for each utility, the lack of access for SMEs to funding in order to allow them to bring their product to full scale development and the need for awareness and knowledge among the society about Smart Water merits. In addition, technology and utility companies have not developed full business plans that demonstrate the true cost of smart water technology and who will reap the reward (initial costs of deployment, payback period, etc.). The government, utilities and consumers’ fear of change related to the adoption of technology on a large scale also needs to be overcome. Besides, there is no strategic, holistic vision set out by the UK Government for smart water solutions which results in SMEs, utility companies, regulators and customers having different perspectives of what smart water is, and what it should offer cities. This lack of vision also acts to constrain legacy investments. Therefore, the water utility sector lacks a holistic view of the water industry and that is why they are reluctant to change what they do not know about. The lack of knowledge extends to utility and analyst companies that do not posses the correct level of data to make water systems fully smart; in this sense, it is found a need for water metering that would take around 3 to 5 years of collecting and interpreting the data after installing the water metering systems; adding to this the political pressure applied to Ofwat and utility companies to keep the coss of household bills low.
On the other side, the higher first cost is consistently perceived as a problem across Europe and it is selected as a top barrier to green development in Germany and UK since these countries got the highest percentage (52%), followed by Poland (38%), in polls. In contrast, the importance of other top challenges does vary by country. For instance, in Germany the affordability/green building for High-End Projects is seen as a barrier by 30% of the surveyed, the second highest percentage, right before UK, with the third highest (40%) in the world, both of which exceed the global average of 27%. The lack of public awareness identified in UK is in sharp contrast to Germany, where it is only selected by 6% of the population. Moreover, the inability to prove the business case due to the split incentive between capital and operating costs is noted as a particular problem in the UK (43%), compared with the rest of Europe (21% in Germany, 3% in Poland and 26% in the other European countries, which is roughly on par with the global average).
Métrica6’s strategy aims to reduce this barriers by means of R&D excellence in product development, scientific rigor of the implementation of the solution, dissemination of results, marketing through local partners and continuous communication with channel and customers.