With population growth, climate change, and industrial pollution threatening the quality and quantity of water available for human use, countries across the world are stepping up efforts to achieve a safe, secure water supply.
As a tiny island nation with precious little freshwater resources, Singapore is an unlikely contender this quest. But like any good underdog story, the city-state has beaten the odds to prove that it can be self-reliant even when one of its key water sources—or in government parlance, one of its “Four National Taps”—dries up.
And the country is confident that even when demand doubles to some 800 million gallons a day in 2016, and its water import contracts with Malaysia end that same year, it will be able to remain water self-reliant.
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What is Singapore’s secret to achieving the seemingly impossible goal of water independence? The answer lies in two of the country’s other national taps: Desalinated water and high-grade reclaimed water, known locally as NEWater.
Together, the two sources make up about 55 per cent of Singapore’s water supply. By 2060, the government expects that they will meet as much as 85 per cent of demand.
In the past decade, Singapore’s expertise in high technology interventions such as desalination and water recycling have made a name for the country as a “leader of the water revolution” and a “global hydrohub“, where business opportunities and expertise in water technologies are abundant and sought after internationally.
As of 2015, there are close to 200 water companies and 26 private research centers across the value chain of the water industry based out of Singapore. These companies have not only boosted Singapore’s own water management capabilities, they have exported their skills around the globe to countries in Asia, the Middle East, Latin America, and Africa.
One company in particular that has been at the heart of Singapore’s journey, and whose own growth mirrors Singapore’s plucky water story, is homegrown water treatment outfit Hyflux.
Making waves in Singapore and beyond
Today an international, publicly-listed company with more than 1,000 employees and almost S$1 billion in revenue last year, Hyflux launched in 1989 with S$20,000 of start-up capital fronted by the company’s founder, Olivia Lum, who is today the company’s executive chairman and group chief executive officer.
Lum tells Future Ready Singapore in a recent interview that “Hyflux’s dream is to improve and transform improve people’s lives through sustainable technology and constant innovation”.
In its early days as a startup, Hyflux—then known as Hydrochem—was a distributor for filtration membranes, which are used in industrial and municipal water treatment.
But over the years, the company researched into the possibility of developing its own proprietary membranes, believing the technology would differentiate it from competitors. The result of this was an innovation known as the Kristal hollow-fibre ultrafiltration membrane, a technology that is used by Hyflux to this date.
Since Hyflux first unveiled its Kristal membranes, it has developed seven generations of the technology to date, and also become Singapore’s first publicly listed water treatment company in 2001.
The membranes are used in some of the world’s largest desalination plants today, such as the Magtaa Desalination Plant in Algeria and the Tianjin Dagang Desalination Plant in China.
Hyflux’s research centres have also produced several other technologies and systems for use in the food and beverage industry, mining, steel and metal production, among others.
Examples of this include a stainless steel membrane called FerroCep, which makes it possible to remove grease from wastewater using less chemicals and energy than conventional solutions; and PoroCep, a plastic-based membrane that helps save energy and reduce costs throughout a wastewater plant’s lifecycle.
Even after more than 2 decades, innovation remains a central focus for Hyflux, whose headquarters are known as the Hyflux Innovation Centre, where the company continues to pursue research and development.
Even as it consolidated its presence in Singapore’s water sector, Hyflux started expanding far beyond Singapore’s shores in the early 1990s. It has offices in China and India today, and has built several desalination plants in Middle Eastern and North African countries such as Algeria, Saudi Arabia and Oman.
“Making clean water accessible and sustainable will continue to form the core of Hyflux’s businesses for the next five years, and beyond,” says Lum, who sees many opportunities on the horizon as Asia experiences rapid economic, urban, and population growth, pointing to growing demand for water for industrial and residential uses.
Recycled water and desalination can help cope with Asia’s water stresses in a sustainable and cost efficient way, says Lum. Her optimistic outlook is compounded by stricter regulations on wastewater discharge in many countries, which will force companies to invest in treating industrial wastewater more effectively.
Long road to success
With its booming business and many awards for innovation and entrepreneurship under its belt, Hyflux is regarded as a Singapore success story today.
But the road to success was not always easy, and Singapore’s conducive environment for startups and entrepreneurship was a key contributor to Hyflux’s success, shares Lum.
When Hyflux was first set up—Lum sold her apartment and car to provide the start-up capital—the company had no track record with which to compete against more established firms in the sector.
As Singapore’s economy opened up in the 1990s and the country encouraged high-value manufacturing, multinationals flocked to the city-state.
Not only was it difficult for Hyflux to attract and retain talent in the face of competition from bigger firms, the young company struggled to enter some markets in the region because they were too competitive for a company with no track record.
But in addition to Lum’s own grit and strategic vision, it was clear that the government’s pro-business policies were invaluable.
For starters, she shares that Singapore’s government places high priority on water security, a sophisticated water management system and infrastructure, and therefore encourages companies to make long-term project commitments via public-private-partnerships.
Indeed, Hyflux’s first desalination plant contract with PUB in 2003 was also its first public-private partnership.
Lum notes that the government’s tenders are “open and transparent, and awarded based on criteria stated in the tender documents”. This allows local enterprises to compete with bigger players on merit.
Nationwide government initiatives have also been crucial, says Lum. From funding, tax schemes for entrepreneurs to trade missions led by government agencies into potential markets, there is much support for companies like Hyflux.
The government’s drive to develop Singapore’s environment and water industry has also benefitted Hyflux, shares Lum. The government works hard to foster a research and development ecosystem, supporting research institutes to set up base here and encouraging collaborations between these institutes, universities, and companies.
As part of this culture of partnerships and collaboration, Singapore’s Economic Development Board and PUB initiated a research collaboration between Hyflux and the prestigious and Nanyang Technological University’s Nanyang Environment and Water Research Institute (NEWRI).
The organisations will be working to develop desalination membranes that mimic biological processes, and require much less energy than conventional models.
“Such support is crucial in helping Hyflux, a global local company, remain competitive on the international stage”, says Lum.
Making clean water accessible and sustainable will continue to form the core of Hyflux’s businesses for the next five years, and beyond.
Olivia Lum, founder, executive chairman and group chiief executive officer, Hyflux
Preparing for the future
Buoyed by its success in the water space, Hyflux has begun to venture beyond its traditional portfolio.
The company is gearing up to deal with looming trends such as energy and labour scarcity, so that it can stay competitive even as natural and human resources grow scarcer.
For instance, in February, Hyflux partnered with EDB on a range of future-ready initiatives to boost productivity and conduct research into new water treatment technologies.
In addition to the research partnership with NEWRI, it made an S$30 million investment in a new automated processing line to make steel structures at its Tuas factory.
“Through automation of our processes, we are able to increase productivity, thereby reducing our reliance on foreign labour and eventually we will be able to upgrade our manufacturing workforce with higher skilled manpower,” explains Lum.
Manpower shortages and economic pressures are trends that Singapore—and the rest of the world—will inevitably have to confront, and through various targeted programmes, the Singapore government has encouraged businesses to prepare for the future by embracing automation and advanced manufacturing.
Eyeing opportunities in an expanding middle class and ageing population in Singapore and the rest of Asia, Hyflux has also applied its expertise in water technology to consumer products.
It unveiled its ELO Water range in 2015, an oxygen-rich drink that it sells as bottled water online.
ELO Water is a “game changer for health and wellness,” says Lum. When the body is unable to transport oxygen effectively to organs due to old age or illness, ELO Water may help counter this, she explains.
Hyflux recently partnered with Singapore’s Changi General Hospital to conduct the first human clinical trials into the impact of ELO Water on Type-2 Diabetes.
As Asia’s population ages and consumers in India, China, and other developing economies grow more affluent, Lum says that ELO Water has the potential to help address their emerging health challenges.
“We are optimistic that ELO water has the potential to further scale up in Singapore and the region,” she says.
Hyflux has also made strides in the energy generation and retailing sector in recent years. Lum says this was both a logical and strategic choice for the company, since water and energy are so closely interlinked.
Its projects in this space include a gas turbine energy generator system at the Tuas desalination plant, and the company also recently won a contract to design, operate, and build Singapore’s largest waste-to-energy plant in Tuas.
Hyflux has evolved from a water specialist into a provider of holistic sustainable solutions that are valued by clients, says Lum, acknowledging that it hasn’t always been easy.
“But it’s important to believe that if there is a will, there is a way,” says Lum. “We have been able to stay competitive in a growing environmental solutions market because of our strong focus on continuous innovation and cutting edge technologies.”
Looking to the future, Lum says that Singapore’s and Asia’s water challenges are both set to intensify, promising new opportunities for innovation and expansion.
In Singapore, “we can expect an increasing demand for water by both homes and industries thanks to urbanization and population growth,” she shares. “Similarly, the demand for sustainable sources of clean water is also expected to grow across Asia and around the world.”
This article was originally published on Future Ready Singapore.