In this next segment I asked HP a couple of questions on what types of applications and markets he is planning for the future. As we have seen in the previous segments, HP has a firm grasp of ERI’s immediate core competency and it’s business environment. Here HP demonstrates another characteristic we often find in serial entrepreneurs: strategic planning.
SM: Is there a broader significance to your energy recovery technology beyond water desalination? Do you have applications in other power related challenges? HP: Yes, as with a bike, you start to paint it in different colors to sell it to different people. Given that you may define the PX as a very sophisticated pump, we will see other industrial applications of the same device going forward.
One is obvious. It is inter-brackish. Brackish water but that operates under lower pressure so you have sort of a longer payback; the next big wave, and it is very easy to be seduced by this one. Of course that is dangerous because you need to remain focused on what you do today and not get carried away with something that may happen tomorrow. But the next big thing is Osmotic Power.
SM: Describe Osmotic Power. HP: Today we do desalination. Meaning we go from salt water to fresh water. Osmotic power is actually taking the forces the other way around where we go from fresh water through a forward osmosis membrane and into salt water. In that process we generate the pressure that will be used to run the turbines which in turn will create electricity. This is the next big wave, I think, for this technology. And this year will be the first major prototype, with an osmotic power plant built somewhere in Europe with our device in it. This is still a few years away from commercialization.
But to give you the scope, one of the largest utility companies in the world using renewable energy, estimates an annual market of about 1600 terawatts. That should be equivalent to about 50 billion Euros in annual electricity production. It is sizeable and is really a function of the PX that this is possible. Otherwise you insert more energy than you get out of it so it becomes less cost efficient. But yes there are issues yet to be resolved.
SM: Interesting, so HP, if I am hearing you right you’re at the moment building the company on the basis of energy recovery for water desalination. But the same technology can enter a new market, which is osmotic power, a significantly larger market of about 50 billion euros per year? HP: Yes 50 billion euros per year.