By Barry Graham,2014-05-16 23:20
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     * E. v. Münch, A. Benesovsky-Scott, J. Josey and K. Barr

    Brisbane Water, 240 Donaldson Road, Rocklea, QLD 4106, Australia



When nitrogen and phosphorus are released to the environment, they can cause environmental damage

    to the surface water, groundwater and soil. The struvite crystallisation process can help achieve the aim

    of operating our industries in an environmentally sustainable manner. This process could form the basis

    of a business for a “Company X”, and this business opportunity is outlined in this paper.

The strategic issues for this business revolve around emerging trends in the environment protection

    legislation to issue stricter licences with respect to nitrogen and phosphorus discharges from wastewater

    treatment plants, piggeries and other industries affecting the quality of our waterways. The market

    research performed for this business has identified two main target markets: pig industry and local

    government owning domestic wastewater treatment plants with anaerobic sludge digesters.

This paper describes the market research performed for this business, the resulting strategic analysis,

    strengths, weaknesses, opportunities and threats to the business, and a summary of the financial plan for

    Company X. The by-product of the struvite crystallisation process, MAP (magnesium ammonium

    phosphate), is a valuable slow-release fertiliser that allows recovery of the limited resource phosphorus.

    Keywords Digester sidestreams, phosphorus recovery, nitrogen, piggery effluent, wastewater

    treatment, struvite, MAP


As scientists and engineers, we spend a lot of resources on researching and developing new wastewater

    treatment processes. But once a promising new technology is found, how is it introduced to the market?

    It is often due to this difficult commercialisation step that good research ideas get lost and do not fulfil

    their potential. One approach for successful commercialisation of innovation is to develop a business

    plan for the new product and find investors. This paper describes key elements of such a business plan

    for commercialising a novel phosphorus removal wastewater treatment process in Australia. The

    business plan proposes to set up a new company, “Company X”, to market the struvite crystallisation

    process (SC Process) in Australia.

Excessive loads of nitrogen and phosphorus in wastewater can cause environmental damage on three

    levels (Kruger et al., 1995):

    ? Surface water pollution (eg. excessive growth of algae, eutrophication, killing wildlife)

    ? Groundwater pollution (eg. nitrates in groundwater are toxic to humans)

    ? Soil pollution (eg. soil degradation, leaching).

The current trends and activities indicate that the Environmental Protection Agency (EPA) in Australia

    is to issue environmental licences that specify lower nitrogen and phosphorus discharge concentration

    Munch page n? 1

limits. This requires that industry and government invest in technology to remove the nitrogen and

    phosphorus from wastewater.

The struvite crystallisation process can cost-effectively remove the pollutants nitrogen and phosphorus

    from wastewater. The Japanese company Unitika Ltd. has been marketing a technical implementation

    of the struvite crystallisation process under the name of Phosnix since the early 1990s (Katsuura, 1998).

    Unitika Ltd. has patented certain technical aspects of the Phosnix process but no patents have been

    lodged in Australia. Our business would market a struvite crystallisation process in Australia that is

    using the same principles as the Phosnix process. For the purpose of the business plan, we call our

    process the SC Process (for struvite crystallisation process).

As will be shown later in this paper, the SC Process can satisfy the needs of two large customer groups

    in Australia for effective wastewater treatment. These two major customer groups are:

    ? Pig producers

    ? Local governments that own and operator domestic wastewater treatment plants with anaerobic



The SC Process removes nitrogen and phosphorus from nutrient-rich wastewater by binding these two

    compounds together in the form of crystallised struvite which can be used as a slow-release fertiliser

    and has commercial value in its own right. Nutrient-rich wastewater (Table 1) mainly originate from the

    following three sources:

    ? Animal production plants (piggeries, abattoirs, feedlots, poultry, aquaculture such as prawn farming,

    dairy, rendering plants, etc.)

    ? Domestic wastewater treatment plants with anaerobic digesters (where anaerobic digesters are used

    for sludge treatment, they produce waste sidestreams that are high in nitrogen and phosphorus).

    ? Fertiliser production plants.

Table 1. Concentrations of nitrogen and phosphorus for nutrient-rich wastewaters.

    Type of wastewater Total N Total P Reference

    (mg/L) (mg/L) Sidestream from domestic wastewater 800 to 1000 60 to 150 v. Münch and Barr (2001)

    treatment plant with anaerobic sludge


    Piggery effluent prior to screen 2175 850 Kruger et al. (1995)

    Piggery effluent after pond treatment 384 44 Kruger et al. (1995)

    Piggery sludge after pond treatment 2617 1696 Kruger et al. (1995)

    The scientific principle underlying the SC Process is that at an elevated pH value, the crystal “struvite” (magnesium ammonium phosphate, in the following referred to as “MAP”) forms, provided that

    sufficient amounts of the chemical compounds magnesium, ammonium and phosphate exist in the

    wastewater to be treated.

Research has been performed into the SC Process at pilot scale (143 L reactor, Figure 1) by v. Münch

    and Barr (2001). The influent for the SC Process was centrate from the centrifuge that dewaters

    anaerobically digested sludge at the Oxley Creek wastewater treatment plant in Brisbane. The results

    from this research program are briefly summarised below:

    ? The pilot-scale SC Process achieved an ortho-P removal ratio of 94% from an influent ortho-P

    concentration of 61 mg/L.

    Munch page n? 2

    ? The alkali and magnesium source used was a 60% magnesium hydroxide slurry (MHS-60). The

    reactor was operated at a pH of around 8.5. Insufficient dosing of magnesium reduced the P

    removal performance.

    ? The SC Process can be realised in a one-vessel operation at short hydraulic residence times (1 to 2

    hours). For influent flowrates in the range of 20 to 120 L/h, the P removal performance was

    independent of the HRT.

    ? The MAP product fulfilled all the requirements for its use as a slow-release fertiliser in Queensland,

    with cadmium, lead and mercury concentrations being well below the legal limits.

    ? The ammonia-N removal ratio of the MAP process was about 6%, which was in agreement with the

    theoretically expected removal ratio based on the N:P ratio of the influent. To achieve significant

    nitrogen removal, phosphorus would have to be added in a stoichiometric quantity. The phosphorus

    could be added in the form of technical grade phosphoric acid or commercially available fertilisers

    such as Superphosphate.

    Magnesium hydroxide solution

    3 mm plastic tube


    V notch weir


    Settling zone with

    ID 600 mm

    Clear PVC reactor, ID 300 mm,

    total liquid height 1365 mm,

    total liquid volume 143 L

    air bubbles in reaction zone

    Centrate from

    wet well

    MAP crystals (settle to

    bottom when air off)

    30 mm PVC pipe

    Compressed air

    MAP product removed

    intermittently (when air off)

Figure 1. Diagram of pilot-scale MAP reactor with ancillary equipment (v. Münch and Barr,


    Munch page n? 3

SC Process for piggery effluent

The environmental problems associated with the excess nutrient loads from piggery effluent are

    (Redding, 2000):

    ? Soil acidification by nitrogen transforming bacteria

    ? Toxic levels of nitrate in forage or reduced forage palatability (for grazing animals) ? Phosphorus in surface soils is mobilised and enters surface water leading to eutrophication (typified

    by algal blooms)

    ? Phosphorus leaching into ground water

    ? Nitrogen (in its nitrate form) leaching and run-off

Piggery effluent is very amenable to be treated with the SC Process for the following reasons:

    ? Piggery effluent and sludge are very high in nitrogen and phosphorus (Table 1). ? Unintentional struvite crystallisation occurs in a majority of effluent treatment facilities of piggeries,

    showing that it is very easy to produce struvite from this wastewater. ? Many piggeries recycle their effluent for cleaning and flushing, and this increases the nitrogen and

    phosphorus concentration of the effluent even further.

    ? Piggery owners could use the MAP by-product as fertiliser on their farms.

SC Process for domestic wastewater treatment

    The SC Process is not intended to treat raw sewage but rather nutrient-rich sidestreams in a domestic wastewater treatment plant. It is often due to these sidestreams (also referred to as sludge dewatering liquors) that it is impossible to achieve extremely low levels of nitrogen and phosphorus in the effluent. This is particularly the case for plants with enhanced biological phosphorus removal, because

    phosphorus is released in anaerobic digesters and then not removed in the sludge. With the SC Process, a biological nutrient removal (BNR) wastewater treatment plant can be upgraded to significantly

    improve its nitrogen and phosphorus removal performance.

Where the SC Process is intended to be used for a domestic wastewater treatment plant, it is ideally

    required that:

    ? the plant is a BNR plant with enhanced biological phosphorus removal

    ? the plant has anaerobic digesters for sludge digestion (because of their potential to produce

    biogas/energy from wastewater, anaerobic digesters will play an increasingly important role in

    wastewater treatment in the future).

By-Product of SC Process: MAP

Unlike many other wastewater treatment processes, the SC Process produces no harmful by-products.

    The by-product that is produced, MAP, is commercially valuable (note: this MAP is not to be confused

    with mono-ammonium-phosphate, which is also often referred to as “MAP”). MAP is produced as a

    powder (Figure 2) or a granule of various granule sizes. MAP can be used as an ingredient in mineral


The theoretical composition of MAP on a weight basis is 9.9% magnesium, 5.7% nitrogen, 12.6%

    phosphorus with the remainder being crystalline water. MAP satisfies a need for mineral slow-release

    fertilisers and has many potential uses in horticulture, for nurseries, golf courses, etc. MAP is likely to be of most benefit to customers as a “boutique” fertiliser. An alternative to supplying the product

    directly to end-users is to sell it in bulk to a fertiliser manufacturer for use as a raw ingredient in their products.

    Munch page n? 4

Figure 2. Photograph of MAP produced from the pilot-scale SC Process at the Oxley Creek

    wastewater treatment plant.

Further research work is required in the following areas:

    ? Investigate optimal conditions for piggery effluent treatment with the SC Process.

    ? Investigate the performance of MAP as a mineral slow-fertiliser.

    ? Investigate the substitution of magnesium in the process with zinc, potassium or other metals. A

    variety of metal ammonium phosphate crystals can be formed through crystallisation. For some

    soils, zinc may be more beneficial than magnesium.


Primary and secondary market research for this business has been performed with the following goals:

    ? Identify key potential customers

    ? Determine market characteristics and customer’s requirements

    ? Determine the size of the market

The results from the market research have formed the basis for the strategic analysis that is presented

    later in this paper.

One important avenue for the primary research was a survey amongst selected wastewater industry

    professionals. All participants were wastewater experts, either with respect to domestic wastewater or

    with respect to industrial wastewater, such as piggery effluent. Twenty filled-in questionnaires were

    received, which corresponds to a return rate of 61%.

The purpose of the questionnaire was to determine:

    ? Possible interest in use of the service offered

    ? Suitability to the potential customers’ operation

    ? Technical issues related to aspects of the process

    ? Perceived direction of regulatory authorities with respect to discharge limits.

The main findings from the survey are shown in Table 2.

Table 2. Primary market research: survey results and significance for the business.

    Munch page n? 5

    Survey result Significance for the business

     65% of the participants were unaware of the Company X will be first to market, but has

    1 existence of the SC Process. to make an effort in promoting the

    technology and generating awareness

    amongst potential customers.

     Two thirds of the participants thought that it There is a general consensus in the industry

    2 would be beneficial or very beneficial to have that sidestream treatment will become an

    separate sidestream treatment for biological emerging trend for upgrading existing

    nutrient removal WWTPs. 25% did not know biological nutrient removal plants.

    some of these may not have been familiar with

    the term “sidestream”.

    1. 35% of the respondents knew of other processes 3The fact that struvite’s fertiliser qualities are

    3 with useful by-products. 70% of respondents generally known means less promotional

    knew that struvite was a valuable fertiliser and work will be required in that area. The other

    60% thought there would be a market for it. “useful” by-products listed were of much

     lower commercial value than MAP.

    2. 85% of the respondent3s were convinced that the This confirms the emerging trend in EPA

    4 EPA limits would become stricter in the future licensing to become more stringent with

    with respect to nutrient discharge limits. respect to nitrogen and phosphorus


    3. All but 5one respondent thought that animal This confirms that the animal production

    5 production industries had effluent problems industry is a major client for Company X.

    with respect to nitrogen and phosphorus.

    4. Piggeries were quoted by 70% of the 6This confirms that amongst the animal

    6 respondents as having the most effluent processing industry, piggery operators are

    problems compared to other animal production the most likely target market.

    industries, followed by poultry and abattoirs

    (multiple answers were possible).

    5. None of the respondents ruled out that piggery 7As above

    7 operators might be interested in the SC Process

    technology (55% yes, and 45% undecided).

    6. 45% of the respondents thought that piggery 8This shows that there would be a market for

    8 operators would pay a separate company for the service of wastewater treatment for

    effluent treatment if such a service was offered piggery operators.

    (45% were undecided).

    7. 60% of the respondents knew of unintentional 9Anywhere where there is unintentional

    9 struvite crystallisation, and piggeries and struvite formation there is also potential for

    anaerobic digesters were cited as examples. the SC Process.

Our marketing objectives are to:

    ? Create awareness of the SC Process with the legislator (once it is known that a process exists to

    economically remove nitrogen and phosphorus from wastewater streams, the EPA licences are

    more likely to tighten).

    ? Position the product as the most cost effective solution to the task of achieving low phosphorus


    ? Educate the key target groups on the benefits of the system.

Company X will adopt the following initiatives as its marketing strategy:

    ? develop and implement an educational campaign to inform industry (both piggeries and local

    government) that phosphorus removal problems can be solved with the SC Process solution.

    ? monitor the performance of initial installations and continually investigate methods of enhancing

    the product.

    ? monitor market reaction to initial installations and use testimonials to assist in sales promotion.

    Munch page n? 6


    The operation of Company X will be flexible to suit the customer’s needs. Our preferred business model is that our Company X owns the equipment and charges the customer a monthly fee for treating their wastewater.

    From the first point of contact with the client to the successful operation of the SC Process, Company X will move along the following steps:

    ? Characterise waste stream

    ? Conduct bench-scale or pilot-scale trials on customer site if required (decision on applicability of

    process is made at this point)

    ? Establish contract agreement

    ? Customise layout/design of SC Process as required

    ? Project management of construction

    ? Commissioning, operation, optimisation, training

    ? Long-term operation and maintenance of the asset

    ? Asset may be handed over to client after specified period

The strategy of the operations plan is as follows:

    ? The first site in Australia will be the demonstration site for future units. ? We will use a standard modular design of the SC Process so that little additional design work is

    required for each new installation.

    ? The expected written-off life of a SC Process is ten years (although the customer may choose to

    operate their individual units much longer). Little maintenance is required for the SC Process as

    there are no moving parts (except pumps).


Legislation Analysis

    Futures analysts and forecasters predict natural resources will become the most valuable commodities as we move away from the industrial age. The full economic benefits of conserving resources are not being recognised because we fail to bring to account the full cycle of savings. Phosphorus is considered one of these resources and is being consumed; it is not a renewable resource and is therefore expected to increase in value.

    The condition of waterways in Australia has come under increasing scrutiny in recent years. This has resulted in a number of studies being commissioned by government and community groups to determine conditions of waterways and promote remedial action through legislation and licensing conditions.

    Stricter conditions are now being placed on those industries adversely affecting water catchments and discharging directly into waterways. The EPA considers the environmental deficiencies identified by these studies and enacts licence requirements that are “reasonable and practical” from an industry perspective. The considerations are not based on individual capacity to pay but on whole of industry. It is therefore expected that these water quality concerns will elevate the importance of nitrogen and phosphorus removal in the future.

    The SC Process is the type of process the EPA would like to have developed as it has a useful by-product and does not produce harmful residues or other waste. The SC Process has the capability to dispose of waste streams from other industries (for example, incorporating them as a magnesium source).

    Munch page n? 7

Pig industry analysis

At many sites, pig production is limited by the effluent disposal options. Land application is the most

    effective method of disposal in Australia, however soils do not have an unlimited capacity for re-using

    effluent, therefore, adequate land area is needed.

Pig production is hence a major contributor to declining water quality in surface water bodies. The

    industry is aware of the need to minimise phosphorus inputs into surface water. Excess application of

    piggery effluent to land can result in on-farm soil damage and off-farm effects on ground and surface


The Australian pig industry is experiencing significant waste management problems which threaten the

    future viability of the industry. Meo and Cleary (2000) show that the number of pig producers has

    reduced from approximately 40,000 in 1969 to approximately 3000 in 1999, however the pig population

    has remained fairly stable over this period (Figure 3). The average herd size has increased from 8 to

    over 100 pigs. This trend towards fewer piggeries, but larger concentrations of pigs has resulted in a

    greater concentration of pig waste.






    200Sows (in '000s)20

    Pig producers (in '000s)10010



    Pig producersSows Figure 3. Structure of the Australian pig industry: Number of pig producers and breeding sows

    from 1960 to 1999.

Our business is favoured by the trend towards fewer, larger piggeries. The cost of the SC Process may

    be prohibitive to small producers, however we are mainly targeting the larger customers who have to

    act in an environmentally responsible manner with respect to waste disposal.

    Munch page n? 8

Figure 4. Australian piglets at a piggery; for every sow on a piggery there are approximately 9

    other pigs.

Effluent from a piggery is diluted with water used for flushing, washing, water cooling and spillage. A

    minium effluent production for efficient piggeries is about 100 litres per sow place per day where

    recycled flushing is practised, or 150 litres per sow per day where fresh water flushing is used. This

    may range up to 250 litres per sow per day (Kruger et al., 1995). Hence, the 300,000 sows that currently

    live in Australia (Figure 3) would produce between 30 to 75 ML/d.

Fresh manure production and characteristics depend on the type of production. For example, for a 100

    sow “farrow to bacon” unit, about 21.7 kg nitrogen and 7.3 kg phosphorus is produced as manure per

    day (Kruger et al., 1995). From the phosphorus that is contained in the manure, about 21 t/yr. of MAP could be produced for a 100 sow unit.

Local government wastewater treatment analysis

The opportunity for our business is of such advantage that we believe government would support some

    funding for the public benefit attributed to its introduction. Since there is “economy of scale” for

    wastewater treatment operating costs, there is a general trend for large centralised wastewater treatment

    facilities, at least in the major cities of Australia. Such large facilities are more likely to invest in

    sidestream treatment than smaller wastewater treatment plants.

There are only about 750 domestic wastewater treatment plants installed around Australia (which is a

    small number per capita compared to the fragmented water industry in some European countries). The

    top ten wastewater treatment plants treat around 50% of the total wastewater generated in Australia

    (AWA, 2000). Twenty WWTPs were identified that have anaerobic digesters, and hence sidestreams

    that would be amenable to the SC Process.


Table 3 is an abbreviated version of the strengths, weaknesses, opportunities and threats (“SWOT”) to

    this business together with the appropriate responses.

    Munch page n? 9

Table 3. SWOT analysis and strategic responses for the business of Company X.

    Strengths Weaknesses Strategic response to weakness

    The SC Process is a green Company X has a lack of Injection of funds at the

    technology that allows working capital. appropriate milestones.

    recycling of a waste


    Staff of Company X has The staff of Company X Staff will visit piggeries, attend

    detailed understanding and has no direct experience courses/conferences on animal

    background knowledge of with the animal production issues. Experts will

    the SC Process. production industry. be contracted in to provide

    specific consultancy expertise.

    Opportunities Threats Strategic response to threat

    The pig industry is limited Pig producers are The product will be presented

    by its effluent disposal conservative and do not in a manner which is

    problem and in desperate embrace innovative conservative and

    need of solutions. technology easily. environmentally focussed.

    EPA is likely to become The EPA may not issue Promotional activities will

    much stricter with licensing tougher environmental demonstrate the benefits of the

    plants for nutrient release to licences due to political SC Process to the EPA.

    the environment. reasons.

    Company X is the first to Other companies in By being first to market we

    market the SC Process in Australia may begin will create awareness and build

    Australia. marketing similar credibility.



Sales Forecast

For the following analysis, the standard size for one SC Process unit is taken to be 0.5 ML/d. This size

    would be sufficient for a piggery with about 2860 sows, which is a large herd. It would also be a

    suitable size for a medium to large domestic wastewater treatment plant (in the order of average dry

    weather flow of 50 ML/d).

The market research undertaken indicates that the potential market sizes are:

    ? About 105 units in the pig industry (based on about 52.5 ML/d of effluent produced by the 300,000

    sows in Australia)

    ? About 20 units for local government wastewater treatment plants (this is a conservative estimate)

The predicted market penetration is 2% for the pig industry in the first year. From then on the growth

    will substantially escalate to 10% market penetration in the pig industry as legislation compels

    industries to conform to stricter licence requirements and early adopters refer new customers.

Operating Costs

The SC Process operating cost structure is detailed below. Costs are quoted in Australian dollars which

    equalled 0.59 Euro at the time this paper was written.

The construction and installation cost of one standard SC Process is estimated to be $400,000. Unitika

    Ltd provided this cost for manufacture in Japan, but further work will be undertaken to obtain a more

    precise cost estimate under Australian conditions.

    Munch page n? 10

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