the water industry includes the complete industrial chain from raw water, water supply, water saving, drainage, sewage treatment and water resource recycling. from the business dimension, it can be divided into tap water supply and water treatment sub-industries, among which water treatment includes water supply treatment and sewage treatment.
(1) the sewage industry has continued to develop, and the demand for water environment treatment has brought about new growth space for the industry, and industrial capacity has maintained growth
in 2017, the stable growth of national economy, urbanization level enhances unceasingly, water sector macro economic situation continues to improve, 2017 total annual water consumption of 2017 cubic meters, an increase of 0.8% over the previous year, the total water supply was basically stable. along with the implementation of the most strict water resources management system, provinces, cities and counties covered by the "three line" basic control index system, the water consumption of ten thousand yuan gdp continued to decline, 2017, ten thousand yuan gdp water consumption of 78 cubic meters, down by 5.6% over the previous year. the amount of water used for value-added industrial production was 49 cubic meters, down 5.9 percent. in terms of sewage treatment, china's total waste water discharge in 2016 was 76.5 billion cubic meters, an increase of 4.04 percent over the previous year.
in 2017, the market demand of water environment management will grow rapidly under the policy promotion, mainly including rural water environment management and comprehensive river basin management. rural water environment management mainly includes rural drinking water source protection, rural household garbage and sewage treatment, livestock and poultry waste resource utilization and pollution control. according to the national environmental protection and the ministry of finance issued in december 2016, the national rural environment comprehensive improvement "much starker choices-and graver consequences-in planning", by 2020, demand of new village 130000 complete comprehensive environmental control system, the regulation twice the size of the size of 2015 years ago. river basin water governance, in october 2017, many departments jointly issued by the key river basin water pollution prevention and control planning (2016-2020) of the seven key river basin water pollution prevention plan for the specific requirements, the "ten" water water quality target decomposition to the basin, has been clear about the direction of the river basin pollution prevention and control of key and the beijing-tianjin-hebei region, the yangtze river economic belt of water environment protection, covering the whole country for the first time range of key river basin water pollution prevention and control planning. in addition, rural water environment management and comprehensive river basin management are all included in the law of the people's republic of china on the prevention and control of water pollution (hereinafter referred to as the "new law") revised in june 2017.
in terms of production capacity, the construction of urban water supply facilities in china has approached saturation and entered a stable development state. in recent years, china's total urban water supply has maintained a growth rate of 2% to 3%. since 2010, the growth rate of sewage treatment industry has slowed down gradually, basically stable at 5% to 6%, and it is in a sustainable development period. the business of renewable water utilization is still in the lead period, and the production capacity and consumption of reclaimed water per day continue to increase.
above all, urban water supply business has entered the mature stage, the sewage treatment industry is in continuous development, reclaimed water use of the business is still in the lead, with policy, environmental protection investment increase, rural water management and river basin water management market demand space.
(2) diversified investment entities, intensified industrial competition, and a trend of cross-regional expansion and competition
water must satisfy the corresponding qualification for admittance into industries and late operation mode, charging standards and environmental standards shall be approved by the relevant government department and supervision, maintaining high regional proprietary. with the further promotion of industrial policies, the demand for comprehensive management projects, such as comprehensive watershed management and rural water environment management, has increased. comprehensive water environment service projects are usually characterized by large investment scale, long recovery period and complicated water treatment process. from the perspective of issuing bonds, water enterprises are still dominated by local state-owned water enterprises. to promote the healthy development of the industry, in recent years the national relevant policies to encourage social capital to participate in water project construction investment, in july 2017, the ministry of finance, environmental protection and other four ministries jointly issued by the "about government involvement in sewage and garbage disposal project full implementation of the ppp model notice (hereinafter referred to as" notice "). according to the content of the "notice", government involvement in the newly built sewage and garbage disposal project full implementation of the ppp mode, clear the compulsory pilot part to carry out the ppp mode, market scope extended to the rural environment management, solid waste treatment and other fields. the circular stressed the risk isolation of the government's participation in ppp projects, pointing out that the government should not provide financing guarantee and promise the minimum profit, which is conducive to the sustainable development of ppp model.
under the policy support and market drive, social capital takes an active part in the investment of water projects in the ppp mode, which alleviates the pressure of government expenditure to a certain extent compared with bot and tot mode. along with the economic developed cities water industry matures, slowing growth in the demand for water infrastructure, related supporting facilities is unsound county-level cities and rural areas become the main wading project floor area.
water industry shift investment patterns to multiple, of social capital to a certain extent promote the industry marketization level, for prominent industry status, technical level good water companies will gradually expand to other cities, water preliminary showed a trend of diversified capital across the region to participate in the market.
(3) water prices have been gradually raised, but enterprises are under pressure to improve quality and efficiency and upgrade technologies, and their industry profitability is weak
at present, china's water industry was still in the stage of transition to a market, the price of water use is dominated by the government of the hearing system, the enterprise of water pricing power, widely used in water supply enterprises' low water loss fiscal subsidies "pattern, sewage treatment enterprises by signing franchise agreement more lowest sewage process in place to ensure that their own profit.
residents of tap water price, to reflect the scarcity of water resources, give full play to the water price adjustment, the country was gradually introduced industrial and service water system of excess progressive surcharges, residents living water using stepwise water price system. according to statistics, by the end of april 2018, 16 cities in 36 large and medium-sized cities, including fuzhou and shenzhen, had raised the price of residential water in the past year. the average price of domestic water (tap water) (the first step water price) is 2.29 yuan per cubic meter. sewage disposal price, according to the national development and reform commission on the formulation and adjustment of sewage treatment charging standard and related issues notice "(sent to change price [2015] 2015), sewage treatment rate to compensate for wastewater treatment and sludge disposal facilities operating costs and reasonable profits and requirements by the end of 2016, the city sewage treatment fee standards in principle should be adjusted to residents is not less than 0.95 yuan per ton, non-resident not less than 1.4 yuan. according to statistics, as of the end of april 2018, nearly a year the country 36 large and medium cities sewage treatment price increases further, a total of nine cities, residents living sewage disposal ranking after seven cities including tianjin, shenzhen and other places, the price is 0.50 yuan to 0.90 yuan/cubic meter (see table 2), there are larger price increase space in the future.
water gradually raised at the same time, the tap water quality requirements and sewage discharge standards has also improved, according to the demand of "water 10 to 2020, prefecture level or above city centralized drinking water sources reach or exceed class iii water quality overall is higher than 93%, at the end of 2017 sensitive area (key lakes, reservoirs, nearshore) urban sewage discharge standard to one class a discharge standard. in april 2017, the ministry issued the national environment protection standard "much starker choices-and graver consequences-in" development plan ", points out that the revised more than 100 environmental quality standards and pollutant discharge standard (control), as the "water of article 10 of the environmental governance objectives provide standards support. at present, about half of china's sewage treatment plants do not meet the first-level a emission standard set by the state, and water utilities are under great pressure to improve quality, efficiency and technology upgrading.
overall since 2017, the water gradually rises to a certain extent to promote the industry profitability, but considering the water pricing involving people's livelihood and social stability, water prices remained at low levels in our country, and the water pipe network upgrades, emission standards and service quality for higher lead to rising cost of water companies, industry profit ability is weak.
