The R&D Tax Credit Aspects of Water Desalination
Water-Desalination
This article will discuss the potential
development opportunities within the water desalination
industry. It is one of a five part Water Tap series
including Water Analytics, Water
Recycling, Desalination,
Advanced Water Technologies, and The
U.S. and Singapore Water Tap Comparison.
The problem of worldwide water scarcity is a large one.
Growing populations, increasing demand for water, and
diminishing freshwater sources have created shortages of water
across the globe. Already 700 million people world-wide
suffer from water scarcity; that number is expected to swell
to 1.8 billion by 2025. Many countries around the world
such as Israel, Singapore, and Japan rely heavily on
desalination technologies to meet the growing water
demand.
In the U.S., the Midwest has been plagued by relentless,
recent droughts with no significant let-up in sight. The
Colorado River is so overtaxed that it rarely reaches the
sea. In California, water from the Sacramento River
delta is being rationed off by state officials, cutting off
many farmers from their main source of irrigation. San
Diego County, with its hot, dry, and increasingly populated
conditions offers insight into where the rest of the country,
and indeed the world, are headed. Many communities are
beginning to look toward the sea for an answer. In order
to make sea water potable, desalination technology is required
to remove salt from the water.
Desalination is an old technology that has much potential for
development. There are at least 26 desalination plants
in California that utilize innovative technologies to remove
salt from seawater and more than 16,000 worldwide.
Still, desalination technology developments have been much
slower and more costly than anticipated, especially in the
U.S.
In America, transporting water from aquifers remains the
favored method because of the lesser overall costs
involved. However, fresh water sources are inadequate to
meet the demand. Against all the gloom described above,
there is good news. Desalination technology has the potential
to be made even more cost effective than traditional water
sources.
The challenge for innovators is to
lower the costs of desalination technology, which largely
involves steep energy usage in blasting water through filters.
In order to meet the challenge, investments in R&D must be
increased substantially. Federal and state research and
development tax credits are available to support the costs
associated with innovation in order to meet this demand.
The Research &
Development Tax Credit
Enacted in 1981, the federal Research and
Development (R&D) Tax Credit allows a credit of up to 13%
of eligible spending for new and improved products and
processes. Qualified research must meet the following four
criteria:
- New or improved products,
processes, or software
- Technological in nature
- Elimination of uncertainty
- Process of experimentation
Eligible costs include employee wages, cost of supplies, cost
of testing, contract research expenses, and costs associated
with developing a patent. On December 18, 2014,
President Obama signed the bill extending the R&D tax
credit for the 2014 year.
Water Shortage: Supply
& Demand Problems
There are both supply and demand-side
threats to meeting the necessary water needs. On the
supply-side, groundwater aquifers and freshwater supplies are
being withdrawn faster than we can replenish them. Even if
there is enough water, much of it is not good enough to meet
human consumption needs. On the demand-side, concern is
arising from an increasing, worldwide population and high
demand users that are geographically concentrated in regions
that cannot sustain such usage. One solution would be to
reduce the demand through conservation. Water analytics
and advanced technologies are available to support this
end. Another alternative, which can be implemented
simultaneously, involves increasing the freshwater
supply. This is where desalination comes into play.
Desalination Defined
Desalination is a term used to describe the
extraction of salt and other minerals from water. The
process is useful in producing water suitable for human
consumption, irrigation, and many other uses. It is
typically utilized on ships and submarines, however, the
technology can also be scaled up to provide flowing water for
communities and cities as well. Nonetheless, due to
higher energy costs associated with the process, it generally
costs significantly more to produce potable water using this
method. The preferred course is still transporting from water
reservoirs or extracting from the ground. Still, these
alternatives are not available in many regions. Thus,
desalination is a viable option if construction and operating
costs can be reduced.
Industry Growth
Looking forward, the growth of global
desalination will be enormous. Since 2000, the global
desalination output has tripled; 16,000 plants are currently
up and running around the world. This pace of
construction is expected to increase further in the future.i
Historically, worldwide, large scale desalination has been
disproportionately built up in the Persian Gulf region where
there is no alternative for public water supply. More
recently, however, the combination of lower cost membrane
desalination and increased water scarcity means that big
desalination plants are now being built outside that region.
Some of these include large scale investments such as the $3.5 billion Victoria Desalination
Plant in Melbourne, Australia completed in December 2012 and
the Magtaa Reverse Osmosis Desalination Plant in Algeria which produces up
to 500,000 cubic meters of drinking water a day, enough to
meet the daily requirements of about five million people.
Other large desalination plants include the Shaoba CCGT Power
and Desalination Plant and the Ras Al Kair Desalination Plant,
both in Saudi Arabia. The Ras Al Kair plant is
particularly interesting, as it is now the largest
desalination plant of its kind in the world. Completed in
January 2014, the plant uses the multi-stage flashing (MSF)
method and reverse osmosis (RO) technologies to produce 228
million imperial gallons per day or 728 million liters, enough
to serve of 3.5 million residents.
Although it may seem like desalination plants of this
magnitude may be significantly addressing the water shortage
problem, it is not yet the case. Only around 1% of the world’s population is dependent on
desalinated water to meet their daily needs. Desalination
technology in the U.S. is even less prevalent. Desalination in
the United States produces less than .01 % of U.S. municipal
and industrial water use. Moreover, most of these
U.S. plants are small facilities built for specific industrial
needs. Indeed, the rest of the world is making
comparably more progress in addressing the water shortage
issue than here in the states.
The accompanying chart shows the gap in worldwide desalination
technology when compared with U.S. technology growth. As
you can see, the worldwide scale is accelerating at a far more
rapid pace.
The chart below shows total desalination capacity by
country. As you can see, smaller countries like Saudi
Arabia and Japan have significantly more desalination capacity
than the United States despite being only a fraction of the
size.
California Awaits
Desalination Plant Construction
California is a U.S. region where the water
shortage issue is particularly prevalent. Water utilities
there have a vested interest in ensuring an adequate water
supply. Yet some utilities in the state are experiencing
difficulties maintaining this mission. California is currently
in the midst of a four year drought. Its local
reservoirs are currently at less than 30%
capacity. Governor Brown recently declared a
drought state of emergency and directed state officials to
take all necessary actions to prepare for water
shortages. As the state awaits construction on the
largest desalination plant in the Western Hemisphere, county
workers and volunteers have been going door to door providing
bottled drinking water to residents. Aside from expanding
desalination use, all other options to quell the problem,
including conservation, have been exhausted.
The Carlsbad Desalination Project aims to address these
issues. It will provide San Diego County with a locally
controlled, drought-proof supply of high quality water that
meets or exceeds all state and federal drinking water
standards. Consisting of a 50 million gallon per day
capacity and a 10-mile water delivery pipeline, the main
objectives of the plan are to:
- Provide a local source of potable
water to supplement imported water supplies
- Improve water supply reliability
- Improve water quality
- Complement local and regional
water conservation and water recycling programs
It is expected that the project will be delivering water to
businesses and residents in San Diego County by late
2015. While the project adds only 10 percent of
the county’s water delivery needs, it will be reliable and
drought-proof, providing a hedge against possible droughts
down the road.
The technology involved is both traditional and innovative.
First, water will be treated and filtered with 18 house-sized,
concrete tanks filled with sand and charcoal. Next, the
water will be pressurized through a stainless steel pipe
measuring one meter in diameter before reaching the more
innovative filtering process.
The technique used is referred to as reverse osmosis. It
has been around now for more than a few decades.
Engineers however, have developed the concept to include many
innovative features in order to provide cost efficieny,
reliability, and durability. Reverse osmosis, however,
is not the only available desalination technology. Other
novel approaches are also discussed in the subsequent
sections.
Reverse Osmosis
Reverse osmosis (RO) is a water
purification method that utilizes a semi-permeable membrane to
remove unwanted particles from drinking water.
Basically, water is forced through a filter which allows the
water molecules to pass through while blocking the salts and
other inorganic impurities. In the normal osmosis
process, water moves from an area of low solute concentration,
through a membrane, to an area of high solute
concentration. The following chart demonstrates the
difference between the two approaches:
Source: Desalination System
Design
Much of the innovation in reverse osmosis technology surrounds
creating efficient and reliable systems while reducing energy
costs. An ideal system removes all pathogens, bacteria, and
viruses while reducing color, turbidity, and mineral content
and at the cheapest cost. Pumps, pressure vessels,
valves, control panels, and other instruments are continuously
developed in order to maximize durability, capacity, and
efficiency. Particular engineering and design elements
can lead to significant cost savings on large
projects. Perhaps the most important aspect to
producers is that the system be able to operate on minimal
electricity usage. Modest reductions in desalination
electricity usage are expected to have substantial market
value.
Theoretically, seawater can be desalinated at 1 kwh/m3 of
water treated. However, in practice, total energy
requirements for the plant are closer to 3-4 kwh/m3 of water
treated . With advances in new RO membrane technology, water
can potentially be produced cheaper using reverse osmosis than
from using traditional methods such as transporting water from
aquifers. Given this fact, the global desalination
market is projected to grow significantly in the next
decade. Global innovators that can produce energy
efficient technology will benefit most from the expansions.
With this, there is strong interest in optimizing the amount
of energy usage closer to the theoretical minimum.
There are several approaches to doing this. Advances in
pressure recovery devices, heat exchangers, pretreatment
processes, and integrated data monitoring systems all provide
avenues toward the theoretical minimum. A great deal of
research and innovation has been focused on membrane
chemistry. Changes to the formulation and different methods of
membrane production allow for small efficiency improvements,
which can be translated into large savings.
Feed Spacer Innovation
The next innovation in line for the
industry involves filtration efficiency techniques that come
from the feed spacer. Many researchers, from academia
and industry, are developing creative designs in the simple
plastic netting. Conwed Global Netting Solutions, based
in Minneapolis, provides netting technology for the water
filtration systems and has invested significantly in R&D
that aims to address three common problems associated with the
feed spacer, which are discussed below.
I. Pressure Drop
It takes a lot of force to push water through the membranes
which translates into high energy costs. Maintaining the
optimal pressure level during this process is very important
in controlling costs. Any decrease in pressure
represents a loss in applied feed pressure and hence a loss of
efficiency, energy, and money. Conversely, any increase in
pressure represents a direct savings to the plant. This is
however an over-simplization of the process because when the
pressure level is too high certain negative trade-offs will
occur.
In an RO plant, the applied pressure comes ideally as much as
possible from high feed stream throughput, and not from
overcoming feed spacer resistance. But a feed spacer with no
resistance isn’t the answer either, because RO elements
require turbulence in the feed stream to work efficiently.
That turbulence comes mostly from the water rushing through
the feed spacer. This is important because it reduces salt
buildup on the membrane. To address the challenge of pressure
drop, researchers at Conwed are experimenting with feed spacer
configurations for optimum flow while still trying to maintain
a sufficient degree of turbulence. While more testing remains
to be done, the feed spacer may have a role to play in
reducing pressure drop to optimal levels in order to control
energy costs.
II. Membrane
Damage
Part of the innovation behind desalination technology involves
creating more durable filters. RO membranes themselves are
susceptible to damage during the manufacturing process when
they are tightly pressed against the feed spacer. In addition,
the feed spacers need a high degree of dimensional
stability—that is, stiffness— to maintain separation between
the membranes. The stiffer the feed spacer, the more likely it
is to damage the membrane. A softer feed spacer, for instance,
one made from resins other than polypropylene, is gentler on
the membrane but can compromise some of the stiffness and
stability.
RO membrane elements undergo extensive quality control checks
before being shipped, including testing for performance and
durability. Elements with membrane damage can’t be
repaired. Instead, they are discarded, and accrue to the
membrane manufacturer’s scrap rate, driving up costs. Research
has suggested that changes to feed spacer resins might offer
breakthroughs in terms of the tradeoff between structure and
membrane damage. Ongoing testing indicates there might be
gains to be made in feed spacer structure without causing
membrane damage, but determining that requires an effective
way to test the spacers to predict potential membrane damage.
The innovation team at Conwed is testing different chemical
configurations and the impact they may have on RO membranes.
“Right now there’s not really a standard way to test membrane
damage without winding an element,” says James Kidwell, leader
of Conwed’s Innovation and Technology Team. Conwed is
attempting to measure and predict what impact different feed
spacers will have on membranes during the winding process (the
process of rolling up the materials in the cylinder filter).
The ultimate goal is to develop even higher quality feed
spacers, with the potential impact on membranes tested,
measured, and documented. All of which is R&D
intensive.
III. Biofouling
Biofouling occurs when unwanted microorganisms and algae grow
on the feed spacer or membrane surfaces. Biofouling could
happen in any RO desalination system and it causes two main
problems for RO plants. The first is clogs in the
membrane and the feed spacer, leaving less permeable area.
This increases flow resistance and leads to higher pressure
drop, causing the RO plant to pump higher pressure water
involving more energy use.
Second, bio-fouling also impairs the quality of the permeate
water. To address these problems, RO membrane elements have to
be cleaned, which causes a reduction of available RO membrane
units for water production. All of these factors contribute to
an increase in water production costs. With this in mind,
Conwed is evaluating the impact different feed spacer
configurations might have on biofouling. Similar to the
pressure drop and membrane damage experiments, current
biofouling experiments have proven that further R&D is
absolutely warranted .
There is much progress to be made with reverse osmosis
technology. RO however is not the only innovative water
desalination technology. The multi-stage flash method,
solar still method, and new electricity method are discussed
below.
Multi-Stage Flash
Method
Multi-stage flash (MSF) distillation is the
most widely used desalination process, accounting for about
60% of all desalinated water in the world. MSF plant
separates water from salt by evaporating the water and
collecting condensation. This occurs in sequences, with a hot
end, a cold end, and intermediate temperatures in
between.
The reason for letting the evaporation happen in multiple
stages rather than a single stage is to conserve energy.
The MSF method is more energy efficient compared to single
stage methods. Like most desalination technologies, the
innovation here is largely focused on cost reduction.
Market prices over the past few years have showed a constant
reduction in terms of investment cost per unit installed,
despite price increases in raw materials and inflation.
Some other recent innovations, however, involved choices of
materials which provided not only cost containment benefits,
but also better performances at the plant. For example,
duplex stainless steel has become the most frequent material
for the evaporator shell, instead of the previously used CuNi
alloys. Adjustments to the thickness of the tube bundle
also gave several similar cost containment and performance
benefits.
Other areas for innovation involve reducing the amount of
energy required by the brine heater or steam transformer,
reducing the amount of steam required by the vacuum system,
and advancements in the electric power pumps. These
innovations however, are merely scratching the surface of
possibilities.
Solar Stills
Solar still technology is a method which
separates salt and water through the evaporation
process. Versions of this technology have been utilized
for thousands of years. However, using solar power to remove
salt from drainage and seawater is still a rather an
unconventional approach. Nonetheless, it is a promising
method of desalination due to the availability of seawater and
strong levels of solar 
radiation throughout the world.
It uses concentrated solar still (CSS) technology to evaporate
and distill water from practically any source by removing salt
and other impurities on-site. Equally beneficial, the
system can store and recycle the excess heat energy it
generates, enabling it to run 24/7 during sunny stretches.
Moreover, the system is modular which allows for scalability –
simply double the number of modules in order to double the
output.
Water FX, based in San Francisco, is currently using the
technology to provide water for California’s Central
Valley. The company's 6,500-square-foot test facility in
Firebaugh can produce up to 65,000 gallons of pure water per
day from various sources. The idea allows farmers to reduce
their reliance on municipal water facilities.
Nonetheless, many farmers are reluctant to accept the
innovative technology. One major hurdle is to convince
them to accept the new approach.
Electricity Methods
University researchers have been developing
a technology that uses small electronic fields to separate the
salt and water particles. To achieve desalination, researchers
at the University of Texas at Austin apply a small voltage to
a plastic cup filled with seawater. Using an electrode
chip that contains a micro-channel with two branches, the chip
neutralizes some of the chloride ions in the seawater to
create an “ion depletion zone”. The electric field
redirects salts into one of the branches on the chip.
This allows desalinated water to pass through the other
branch. The new method is considerably 
simpler than conventional methods, and is so
low energy that it can be performed with energy provided by
store bought batteries.
Researchers have not yet been able to achieve the 99%
desalination that is required to make the water potable.
Nonetheless, they remain confident that this goal is very
achievable. They describe the experiments as a “proof of
principle” says Kyle Knust, a graduate student and co-author
on the new research paper. Knust says, “We’ve made
comparable performance improvements while developing other
applications based on the formation of an ion depletion zone.
That suggests that 99% desalination is not beyond our reach .”
Nonetheless, the process would still need to be scaled up so
that its use could provide water in mass amounts. As of
right now, the micro-channels are about the size of a human
hair, and produce only about 40 nano-liters of desalted water
per minute. Researchers are confident, however, that
larger scale production can be achieved, creating a future in
which the technology is deployed at different scales to meet
different needs. Other universities are developing
innovative desalination technologies as well.
University of
Manchester (UK)
The University of Manchester has been
stirring up much academic and industry interest with its new
filtration technology ideas. Scientists there are using
a material known as Graphene to draw water more
effectively through the filters. The interesting paradox
is that the material commonly known for its hydrophobic (water
fearing) properties is actually being used to vigorously suck
water through the filter, allowing for rapid permeation.
Two years ago, researchers discovered that thin membranes made
from the material were impermeable to all gases and vapors
except for water. This makes for a good filtration material.
The real benefit, however, lies in the unique characteristics
of the material which allows for very rapid water
permeation. This technology would be useful in
filtration oriented technologies such as reverse osmosis.
Conclusion
Looking forward, desalination technology
will be a critical part of the world’s water supply.
Desalination technology developments have been much slower and
much more costly than anticipated however, as innovators
develop new and existing technologies, the cost of water
desalination will hopefully decline significantly in order to
make the technology widespread. Federal and state
R&D tax credits are available to support these innovative
activities.
