What’s in your water? In Flint, Michigan, a 2014 water-supply switch from Detroit’s Lake Huron system to the Flint River led to concentrations of lead significantly exceeding the maximum acceptable levels. Earlier this year, CNN reported that over 5,300 water systems in the US were in violation of the EPA’s lead and copper regulations, which were designed to protect Americans’ drinking water. As the graphic below shows, there are nearly 18 million people who, as of 2015, were being served by community water systems with reported violations of the lead and copper regulations.
In many of these locations, water infrastructure is outdated, leading to higher-than-acceptable levels of contaminants in drinking water. Unfortunately, as University of North Carolina’s Environmental Finance Center points out, spending on capital infrastructure for water utilities has not kept pace with operations and maintenance spending, and “as state and local governments’ budgets are spread thinner by paying for rising operations and maintenance, their ability to also pay for capital expenses decreases.” Thus, we end up in situations such as Flint, Michigan, where a cost-cutting measure leads to poor social outcomes.
While sensors themselves are not the answer to suboptimal infrastructure spending or replacement for EPA monitoring of water quality, they may increase transparency and decrease data collection costs so that citizens are aware of what’s in their water, and so that local, state, and national governments can respond quickly once problems are detected.
Researchers at University of Wisconsin-Milwaukee began the development of water quality sensors, and formed NanoAffix Science to commercialize the technology.
Based on an email exchange with Junhong Chen, inventor of the technology and founder of NanoAffix, the company is developing and prototyping two types of low-cost sensors that can test tested for heavy metals, bacteria, and/or nutrients: One, a hand-held device for one-off water quality testing, and two, continuous monitoring sensors that can operate while submerged.
Initially, NanoAffix’s sensors will enable rapid, high-precision, low-cost testing for lead via the handheld device. The next step is continuous testing: NanoAffix’s sensors will enable water utilities to track real-time data on water quality throughout their systems relatively affordably, and pass their data through to regulatory agencies.
Investing in a path to commercialization
At least three companies have invested in NanoAffix’s sensor technology to enhance their value propositions to customers:
- A.O. Smith is currently focusing on applying the technology to the home filtration systems it manufactures in, and for, the Chinese market.
- Badger Meter, on the other hand, manufactures water meters and is considering installing water-quality sensors within its meters.
- Baker Manufacturing produces pumps and water filtration systems, and may apply these sensors to pumps for private wells.
A business model for Badger Meter could be to sell both the hardware (sensors) and the software (data tracking platform, layered-on data analytics) to municipal water utilities. Spending on distributed, continuous testing should enable these utilities to isolate problems – for example, if copper is only in the pipes of a certain neighborhood – and to identify them earlier, driving cost savings through early response.
While the current and in-development applications represent sizable market opportunities, they largely focus on B2B segments or niche B2C. Significant mainstream B2C business model applications may also exist, and should be considered.
Opportunity 1: Consumer-facing water quality sensor
Currently, consumers have two options if they want to test their water at home: Purchase one-time-use water testing kits from Amazon which require them to color-match or find a certified water-testing laboratory that will accept private residence samples (few in Massachusetts do). The former is unreliable; the latter is expensive, complicated, and time-consuming.
Nanoaffix’s in-development continuous monitoring technology could result in a product that addresses these challenges. Eventually, a sensor could be placed in a faucet, providing real-time information to the user (via an app).
This would enable an exciting business model. The product could be sold as an annual subscription including both the price of replacement sensors and access to the app. In addition, the data collected could be sold to local water utilities, giving them access to water quality at the home-level without requiring them to spend their limited funds on a massive fleet of sensors.
Opportunity 2: Consumer filter quality sensors
From refrigerator-based water filters to Brita filters, the use of microfluidic water quality sensors could increase the frequency of filter replacement, enhance the ease of reordering (e.g., via the monitoring app), and increase customer satisfaction with the filters they’re using. Currently, consumers may not know whether the filters they’re using are effective; they certainly are unaware of the quality of their water at any one point in time. NanoAffix’s technology could thus be integrated into existing products, providing additional value to both consumers and producers.
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 Shadi Eskaf, Senior Project Director of University of North Carolina Environmental Finance Center, article: “Four Trends in Government Spending on Water and Wastewater Utilities Since 1956”
 Milwaukee Journal-Sentinel: “Clean Water Crisis Spawns UWM Research into Water-Monitoring Products”