NanoH2O Invests $45M to Change the Economics of Desalination in China

“It all comes down to the performance of the membrane.”

Greentech Media's editorial focus is on renewable energy, the modernization of the electrical grid, and the evolution of the utility-customer relationship as distributed generation deployment increases.

But we also cover water technology, because the water-energy nexus can't be ignored. There is a looming water crisis for nearly every region of the globe as populations rise, pollution increases, and climate and weather patterns change.  

Desalination is one way of addressing some of these water problems. The process can be accomplished with a number of expensive, energy-intensive technologies, including distillation, ion-exchange and reverse osmosis. Reverse osmosis (RO) is a well-established desalination technology, but there are challenges pertaining to the amount of energy consumed in the process. The key to the economics of the reverse osmosis process is the membrane. 

"It all comes down to the performance of the membrane," said Jeff Green, water startup NanoH2O's CEO, in an earlier interview. "A more productive membrane allows less energy to be used or provides higher throughput."

NanoH2O is a well-funded, Los Angeles-based startup that is commercializing a new membrane material based on technology developed by UCLA's Eric Hoek. The VC-funded firm has had a measure of success with deployments across the globe (see case studies here). The company has won more than $85 million in funding and credit facilities from Khosla Ventures, Oak Investment Partners, BASF, Total, and CalPERS Clean Energy & Technology Fund. 

The firm just announced its intention to build a manufacturing site in Liyang, China, a city 150 miles west of Shanghai. The 10,000-square-meter factory comes at a total investment of $45 million and is expected to be operational by the end of 2014.

China holds one-fifth of the world's population, but just 6 percent of the global fresh water supply, according to the company. The Chinese government is looking to increase its seawater reverse-osmosis desalination capacity threefold by 2015. Its latest Five-Year Plan calls for 70 percent of the equipment used in desalination plants to be produced domestically, according to NanoH2O.

The "benign nanomaterials" used in NanoH2O's thin-film layer have demonstrated a 50 percent to 100 percent increase in permeability compared to traditional thin-film RO membranes. A higher-performance, more permeable membrane allows more fresh water to cross the barrier with less pressure from a pump, which needs to be driven by an energy source, often natural gas, diesel, or coal.

The high-pressure pump consumes 35 percent to 60 percent of the process' energy budget. According to the company, municipal and industrial plants optimized for NanoH2O’s membranes can expect up to a 20 percent reduction in energy consumption, a 70 percent increase in water production, or a 40 percent smaller plant footprint.

"Just two years after our commercial entry into the RO membrane and desalination markets, the opening of this second facility marks a major expansion for our company that will allow us to support a rapidly growing international market," said CEO Jeff Green in a statement. 

The firm also furnishes a comparison tool via which competitor products can be directly compared to NanoH2O's membrane module on critical technical specs.    

The industry-standard membrane module is a cylinder 8 inches in diameter and 40 inches long. A flat sheet of membrane is spiral-wound in the cylinder. Under pressure, the desalinated water moves through the membrane into a tube on the inside while the waste stream or brine stream remains on the outside. A typical pressure vessel contains many of the membrane modules. NanoH2O's goal has been to make a membrane module that fits into RO systems with an identical size and shape to the existing product. 



Traditional membranes have been made from a polyamide material for decades, but they had a propensity for fouling, and “fouling can severely degrade the productivity of the process or cause a complete shutdown of a system,” said Green. The firm claims that NanoH2O's technology is the first materials breakthrough in RO membranes since the 1970s.



Looking forward, Green envisions the desalination market becoming a much more global industry to drive down the cost of the process.



Other firms working on membranes for water applications include the industrial plumbing giant Danfoss, while Energy Recovery, Novozymes and a startup called Aquaporin are doing related work. The challenge, Aquaporin CEO Peter Jensen told Greentech Media, is making the membrane durable.



The U.S. is now "entering an era of water scarcity, as opposed to large chunks of the rest of the world that are already in the midst of water scarcity,” said Gayle Pergamit, CEO of membrane start-up Agua Via, in an email.  "Even if there wasn’t one whit of climate change, we are still going to run out of water. Nanotechnology-based water filtration could deliver completely pure water from any source at vastly reduced energy usage and lower total costs."