VALUE CREATIONCASE 03

Water

OUR INSIGHT AND STRATEGY
Water is one of the focus areas for Hitachi’s Social Innovation Business. Hitachi aims to become
a comprehensive water service provider, responsive to the needs of the market and its customers.
The water business unit seeks to resolve water-related issues by providing end-to-end solutions
worldwide, from design and construction of purification, desalination, and sewage treatment plants
to the building, operation, and maintenance of monitoring and control systems.
Changing Markets and Sustainable
Development Goals

Demand for water resources is increasing rapidly, driven by
population growth, economic expansion, and urbanization.
The Organization for Economic Cooperation andDevelopment estimates that by 2050 world water demand
will have increased on the order of 55% in response to
growth in manufacturing, thermal power generation, andhome use. The market for seawater desalination plants inparticular is expected to double in size by 2020.
Hitachi has supplied water-related products andsystems to more than 200 sites in 40 countries and regions
around the world. We are currently expanding globally, withfocus areas including the ASEAN countries and India, whererising populations are fueling major market growth; theMiddle East and Africa, where the need to secure drinking

water is acute; and North America, where increasing
attention is paid to drought countermeasures.
Some water-related challenges are global in scope.
Two of the United Nations’ Sustainable Development Goals(SDGs) deal specifically with water: Goal 6, “Ensure accessto water and sanitation for all,” and Goal 14, “Conserve andsustainably use the oceans, seas, and marine resources.”
Hitachi is determined to leverage its technology to supplysafe and affordable water to people throughout the world,
provide sewage treatment and other sanitary facilities, andconstruct systems enabling more efficient use of water.
Additionally, we will continue striving to reduce marine
pollution and help achieve the SDGs.

Business Rollout in Response to Regional Needs
Seawater desalination/advanced water treatment projects(including focus areas)

Activities
Expand business in seawater
desalination and advanced sewage
treatment fields(respond to needs through superior technologies)

ODA projects

Engineering bases

Developing countries, emerging countriesNorth America

Urbanization, population growth
Putting in place large-scale infrastructures
Financial challenges, business customs

Droughts (US West, South)
Advanced sewage treatment(nitrogen removal)

Steadily promote and expand large-scaleprojects(ODA projects, partnerships using uniquetechnologies)

Roll out business with close community
ties by strengthening Front Engineering(Singapore, USA)

Saudi Arabia

USAJapan

Iraq
India

Palau
Maldives
Singapore

TuvaluNauru
Vanuatu

BrazilSouth Africa

Island countries, resorts
Small, compact
Package proposals (water landscapefacilities, pools, etc.)

26Hitachi, Ltd. Integrated Report 2017

Shipboard plants
Small, compact
Environment resistant (vibration, salt damage)OUR ACHIEVEMENTS

CEO Message
Strategic Focus

Value Creation

In 2016, at the request of the New Energy and Industrial
Technology Development Organization (NEDO), Hitachi
began an integrated seawater desalination and water reusesystem demonstration project in eThekwini, formerly known
as Durban, South Africa.
eThekwini is on the Indian Ocean coast and has apopulation of roughly 3.6 million. Its water shortages are dueto the concentration of this population in urban areas and its
lack of precipitation. Seawater desalination was the firstpotential solution to be investigated, but conventional systems
require high-pressure pumps to force seawater throughreverse osmosis (RO) membranes, and these pumps consume
a great deal of electricity. With electricity costs rising sharply inSouth Africa of late, this proved a significant hurdle.
Meanwhile, Hitachi’s interest in developing andaccumulating operational and administrative knowledge
about the water business, with a particular orientation toward
international development, had seen the company work with
Toray Industries, Inc. and other partners to establish theGlobal Water Recycling and Reuse Solution Technology
Research Association in 2010. Under contract from NEDO,
and in collaboration with the municipal government of
Kitakyushu and other partners, Hitachi opened Water Plaza
Kitakyushu, moving forward with pilot experiments for a newenergy-efficient desalination technology Hitachi had
developed and dubbed “RemixWater.”
Kitakyushu had experience in the water businessthrough public-private partnerships, particularly inSoutheast Asia, and took the initiative in inviting researchersand observers from around the world to visit and study atWater Plaza Kitakyushu. Hitachi’s RemixWater system wasof great interest to the delegation from eThekwini, and thecurrent demonstration project was the eventual result.
By diluting seawater with treated sewage, RemixWater
reduces the desalination pump pressure, cutting the energy
consumption of the system as a whole by around 30%. The
burden on the environment is also reduced, with the water
ultimately discharged into the ocean almost exactly as diluteas seawater. For this demonstration project, Hitachi will installa new RemixWater system in eThekwini’s existing sewage
treatment facilities, sufficient to desalinate 6,250 m3 ofseawater per day—enough for around 25,000 people. The
demonstration period is planned to last until November 2020.

Hitachi believes that to resolve social issues like those
identified by the SDGs, it is crucial not only to provide
technology but also to nurture human capital rooted in eachregion. Since 2009, with the support of South Africa’s
Department of Science and Technology (DST), Hitachi has
run the Hitachi-DST Scholarship Program for South African
Engineers, which aims to support the development ofyoung engineers in South Africa. Since fiscal 2015, Hitachi
has contributed to the development of young human capitalin South Africa by inviting around five engineers from thewater treatment field to Japan each year, where they spend
around two months observing Japan’s cutting-edge
advanced water treatment technology and participating intechnical training at Hitachi’s factories and other facilities.
Hope Joseph, a fiscal 2016 training program
participant who is based in eThekwini, says, “Water Plaza
Kitakyushu was very interesting as it showcased theRemixWater plant, which uses technology with low
environmental impact—energy-saving as well as costeffective. The program also changed my views as anengineer, making me realize that structured institutional
mechanisms are required for the success of a project aswell as technology.” Joseph now holds presentations toshare what she learned in Japan with her co-workers backhome. There is great interest in South Africa in private
initiatives to nurture human capital, and Hitachi’s steps inthis direction are welcomed warmly.

Workshop participants paying a courtesy visit to the mayor of Kitakyushu(Hope Joseph is fifth from the right).
Management & Governance

Seawater Desalination Initiatives in South Africa

Nurturing Young Engineers in South Africa

The SDG Workshop in the Water Business Unit
To grasp the evolution of market needs from a perspective
centered on the UN Sustainable Development Goals,
Hitachi held an internal workshop for water business unit
engineers, with external experts also invited to participate,on the theme “Expanding business potential byunderstanding needs from an SDG-centric perspective.”
One issue explored at the workshop was how the businessshould recognize regional social issues surrounding
products and services, with seawater desalination in South
Africa used as an example. Hitachi will continue to bothraise awareness of the SDGs and develop its waterbusiness in order to help resolve social issues.

A sewage treatment plant in eThekwini is the planned site of the RemixWater
demonstration project.
Hitachi, Ltd. Integrated Report 201727

Performance

Enhancing Regional Autonomy ThroughWater Initiatives

Our Business Model

As a comprehensive water service provider rooted in each individual region, Hitachi takes social
issues into account when considering market and customer needs and supplying technology. It
also promotes a variety of local initiatives, including participation in business planning and humancapital development.