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EBI News for July 1, 2020- Environmental Performance Increases in the US

EBI News for July 1, 2020- The following news section highlights the latest stories in the Environmental Industry. Including information on how the United States government environmental performance increases, as well as acquisitions and plans/upgrades to company level environmental projects.

Stantec picked to lead large wastewater consortium in Egypt

The Egyptian Holding Company for Water and Wastewater has selected a consortium led by Stantec (Edmonton, Canada) to improve sanitation in the rural Fayoum province of Egypt, 55 miles southwest of Cairo. Stantec will act as consultant to the large-scale construction program to expand wastewater treatment, water reuse capabilities and the sewerage network. The first phase will expand sewer services in 119 underserved rural areas in Fayoum, including constructing four new wastewater treatment plants, expanding seven, rehabilitating 10, and decommissioning six. It will also entail constructing 159 miles of pressurized rising mains, 1,450 miles of sewer lines, and 100 new sewage-pumping stations. The Fayoum Wastewater Expansion program has a value of €456.5 million and is financed by the European Bank for Reconstruction and Development.

Trinity Consultants acquires Vision Environment in water quality monitoring

Trinity Consultants Inc. (Dallas), a portfolio company of Levine Leichtman Capital Partners, has acquired Vision Environment Australia Pty Ltd. of Queensland, Australia. Vision Environment provides water quality monitoring services to clients in commercial dredging and industrial activities that impact the marine environment. The acquisition includes a team of highly qualified research staff, dedicated laboratory facilities, specialized field equipment, and commercial vessels used to collect real time water quality data. “VE’s collection, management, and analysis of high-volume environmental data is of particular importance to the success of client projects and protection of water quality,” said Jay Hofmann, president and CEO of Trinity Consultants. Founded in 1974 and historically focused on air quality, Trinity has diversified into EHS and other environmental sectors, growing organically and making more than 20 acquisitions. Trinity Consultants is profiled in the new 2020 Industry Outlook of Environmental Business Journal®

Joint venture selected for recycled water program in Sacramento

A joint venture (JV) of Brown and Caldwell and Carollo Engineers (both headquartered in Walnut Creek, Calif.) has been chosen by the Sacramento Regional County Sanitation District (Regional San) to provide capital program management services for the $375 million South Sacramento County Agriculture & Habitat Lands Recycled Water Program. The Program is intended to meet Regional San’s long-term goal of increasing use of recycled water by irrigating with highly treated tertiary effluent in lieu of groundwater. It is one of the largest agricultural reuse projects in the United States, providing up to 50,000 acre-feet per year of Title 22 tertiary-treated recycled water to irrigate as much as 16,000 acres of agricultural and habitat conservation lands in Sacramento County. As a member of the capital program team, the JV will provide technical, financial, and project management oversight, laying the foundation for cost- and schedule-efficient design and construction of the new recycled water delivery system. The system will consist of a 95-mgd pump station and 65 miles of transmission and distribution pipelines. 

IEA’s plan would accelerate deployment of clean energy technologies and infrastructure

As governments respond to the economic shock of Covid-19, the International Energy Agency (IEA) has published a three-year Sustainable Recovery Plan focusing on actions to revitalize economies and boost employment while making energy systems cleaner and more resilient. Analysis in cooperation with the International Monetary Fund shows certain policies and investments in 2021-2023 could boost global economic growth by an average of 1.1% a year; save or create roughly 9 million jobs a year; and reduce annual global energy-related greenhouse gas emissions by 4.5 billion tonnes. The largest portion of new jobs would be in retrofitting buildings for energy efficiency and in the electricity sector, particularly grids and renewables. Other areas that would see higher employment include energy efficiency in industries and low-carbon transport infrastructure. The IEA describes a unique opportunity for government action because, compared with the 2008-2009 crisis, the cost of clean energy technologies such as wind and solar PV are now far lower and emerging technologies like batteries and hydrogen are ready to scale up. The Plan would require global investment of about $1 trillion annually over the next three years or about 0.7% of today’s global GDP.

GEI awarded contract for Superfund site cleanup in Michigan

GEI Consultants Inc. (Woburn, Mass.) has been awarded a Kalamazoo River Superfund Site Cleanup in Michigan by NCR Corporation (Atlanta, Ga.), previously known as National Cash Register. The environmental cleanup project is part of the Allied Paper/Portage Creek/Kalamazoo River Superfund Site in Michigan and recognized as one of the largest and most complex polychlorinated biphenyl (PCB) remediation sites in the country. The site covers 8 miles of the Kalamazoo River in the area of Plainwell to Trowbridge Township, Mich. GEI is the lead engineer for the project and will manage all investigative, remediation, and restoration activities. The cleanup is expected to take decades to complete. GEI has 900 staff and 42 offices in North America.

Wunderlich-Malec acquires IPP Connect to expand efficiency and renewables practice

Wunderlich-Malec Engineering Inc. (WM, Eden Prairie, Minn.) has acquired IPP Connect LLC to focus on energy cost reduction, efficiency, and renewable goals. This strategic acquisition enables WM to expand energy services into the commercial and industrial sectors. IPP’s patented mGrid technology provides access to lower-cost wholesale renewable power, as well as software tools for helping utilities make the business case for investments in renewable delivery systems. Since 2009 IPP Connect has provided over 200 C&I and utility energy assessments and plans, in addition to energy market, technology, and rate expertise including sophisticated in-house energy and financial modeling capability. According to WM, IPP Connect has helped customers meet sustainability and energy goals while reducing energy costs by 40% to 60%. WM operates over 36 technology, software, and engineering offices throughout the United States. 

J.S. Held acquires Twenty First Century Engineering

Global consulting firm J.S. Held (Jericho, N.Y.) has acquired Twenty First Century Engineering (TFCE, Vero Beach, Fla.), a specialist in professional engineering, forensics, environmental services, and construction and disaster support. The TFCE team is recognized for expertise in civil and structural matters throughout the Southeastern United States, Texas, and the Caribbean. This acquisition strengthens J.S. Held’s forensic architecture and engineering practice with the addition of experts who have extensive practical and testifying experience in the analysis of accidents, natural disasters, fires, structural failures, and water damage.

EcoSouth becomes Kinderhook’s tenth environmental services platform 

Investment firm Kinderhook Industries, LLC (New York, N.Y.) announced the recapitalization of EcoSouth Services of Mobile, LLC (Axis, Ala.) in partnership with Jeff Claunch, a waste industry veteran. EcoSouth represents Kinderhook’s 10th environmental services platform and 47th transaction in the space. EcoSouth is an integrated waste company operating the Axis Industrial Landfill, the only private EPA, RCRA Subtitle D compliant landfill in Mobile County. The company also provides transportation and in-plant services for businesses that generate non-hazardous solid and liquid waste throughout the Gulf Coast. Since founding in 2012, EcoSouth has modified its permits to allow for additional waste streams and expanded its service area from two to 19 counties.

Parsons releases predictive technology to protect utilities against wildfire and outages

Parsons Corporation (Centreville, Va.,) has released Grid Armor, a predictive resiliency technology that helps utility companies improve operational efficiency and respond to and prevent potentially catastrophic events like wildfires and major power outages. Using artificial intelligence and machine learning, Grid Armor collects real-time data from weather, conductors, video and vegetation and provides actionable information to help utilities maintain the grid. Grid Armor gathers data from Parsons’ PeARL 3D aerial imaging system, real-time overhead power line health monitoring, and video, weather and sensor inputs. The proprietary software scrubs the data and provides predictive analytics through a dashboard that allows utilities to visualize the data and act where needed to mitigate damage from earthquakes, tornadoes, hurricanes and other storms that can lead to outages and even wildfires.

San Francisco gets $513 million EPA loan for wastewater upgrades

The U.S. Environmental Protection Agency (EPA) announced a $513 million Water Infrastructure Finance and Innovation Act (WIFIA) loan to the San Francisco Public Utilities Commission (SFPUC) to help finance pre-treatment and other improvements to its Southeast Treatment Plant, which treats 80% of San Francisco’s wastewater. This is the second WIFIA loan supporting the Plant. The improvements project will cost over $1 billion; EPA’s WIFIA loan will finance nearly half of that. Additionally, the California State Water Board Clean Water State Revolving Fund will finance approximately $244 million with the remaining project funds coming from revenue bonds. The WIFIA loan will save the SFPUC an estimated $226 million compared to typical bond financing. Project construction and operation are expected to create 3,355 jobs.

Rural electric infrastructure funding earmarks $386 million for smart grid technology

The United States Department of Agriculture (USDA) is investing $1.6 billion to build or improve rural electric infrastructure in 21 states. Loans and loan guarantees are being provided to rural electric cooperatives and utilities through the Electric Loan Program to build and improve electric transmission and distribution lines. The loans include nearly $386 million for investments in smart grid technology. For example, The Highline Electric Assn. in Holyoke, Colo. is receiving a $39 million loan, including $11.4 million in smart grid technologies. And New Mexico’s Socorro Electric Cooperative is receiving a $28 million loan, including $2.4 million in smart grid technologies.

USACE awards restoration contract for Minnesota Valley National Wildlife Refuge

The U.S. Army Corps of Engineers, St. Paul District, has awarded a $4.1 million contract to S.M. Hentges & Sons Inc. (Jordan, Minn.) to begin constructing habitat restoration between Shakopee and Savage, Minn. The project will include six water-level management structures to restore diminished plant and bird habitat in Blue Lake, Rice Lake, Fisher Lake and Continental Grain Marsh. The structures will provide the U.S. Fish and Wildlife Service the ability to raise, lower or maintain water levels in the lakes and marsh. Funding is under the authority of the Upper Mississippi River Restoration Environmental Management Program.

U.S. ranks number 24 on Environmental Performance Index

The Environmental Performance Index 2020, published every two years by Yale and Columbia universities, has ranked the United States 24th in terms of environmental health and ecosystem vitality. The scorecard is based on a data-driven summary of the state of sustainability around the world and uses 32 performance indicators across 11 categories to rank 180 countries. The top 11 performers were all in Western Europe, led by Denmark, Luxembourg, Switzerland and the UK. Data for the EPI come from international organizations, research institutions, academia, and government agencies.

Amazon announces $2 billion Climate Pledge Fund

Amazon (Seattle, Wash.) has announced a $2 billion venture fund for sustainable technologies and services that will enable Amazon and other companies to meet The Climate Pledge, a commitment to be net zero carbon by 2040. Amazon and Global Optimism co-founded The Climate Pledge last year. The new fund will invest in companies in multiple industries, including transportation and logistics, energy generation, storage and utilization, manufacturing and materials, circular economy, and food and agriculture. Eventually Amazon said it would look for opportunities to involve other Climate Pledge signatories in this venture investment program.

 

Excerpt from recent EBJ edition on Environmental Industry M&A and Covid-19 impact

Covid-19 as a force majeure event?

The Covid-19 pandemic has had a chilling effect on merger and acquisition activity in the environmental consulting and engineering (C&E) industry. However, valuations could prove resilient if the pandemic is regarded as a “force majeure” event beyond the reasonable control of the company and its ability to perform. According to Al Spiers, founder and CEO of 2020 Environmental Group, a management consulting and M&A advisory firm, many environmental C&E firms were expecting a 10-15% decline in revenues in Q2 only to rebound by Q4. “Companies considering selling in 2020 might not see their valuations negatively impacted by Covid and instead have any dip in financials treated as a one-time non-recurring revenue normalization or EBITDA adjustment,” said Spiers. “Companies coming off a strong 2019 performance and showing a positive year-end recovery could even see their valuations increase, since they would be viewed by buyers as a lower risk and higher investment value.” 

Writing for Environmental Business Journal’s annual M&A edition, Spiers advised keeping good records of any decline in revenues and profits due to Covid-19 restrictions to support a valuation adjustment, and building a strong forecast showing how your company will rebound in 2021. Analysis of M&A activity in the environmental industry can be accessed by subscription to Environmental Business Journal® or by purchasing EBJ’s recent M&A edition off the shelf. In addition to trend analysis by 2020 Environmental Group and an analysis of the early impact of Covid-19 on the environmental market, this year’s EBJ analysis of M&A includes valuable commentary and data charts from Morrissey Goodale, AEC Advisors, EFCG, ROG + Partners, and other leading environmental advisory and investment banking firms, plus EBJ analysis of Census Bureau data and proprietary research, coverage of the solid waste and recycling segment, and profiles and executive Q&As with leading acquirers and recent sellers.

 

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