Third-Party O&M for Water and Wastewater Utilities: Contracts, Competitive Landscape, and Trends

Private participation in water & wastewater takes many forms, from system ownership and concessions to third-party operations & maintenance (O&M) contracts. Enabled by lower barriers to entry across a fragmented addressable market, O&M providers represent the lion’s share of private participation in the U.S.

The third-party O&M services segment has garnered significant attention in recent months in the wake of pandemic-related workforce disruption (e.g., remote work, rising labor rates), regulatory calls for advanced treatment solutions, and shifts in the competitive landscape―headlined by recent M&A by New Mountain Capital, Inframark, Veolia, Suez, ESG Operations, and H2O Innovation.

This changing market environment presents an opportunity for third-party service providers to capitalize on their applications of technology experiences, geographic coverage, and scale, particularly at the lower end of the utility scale (i.e., very small to medium- sized systems).

Bluefield has identified 2,066 O&M contracts from the 1970s to present day. These contracts represent the foundation to a new market sizing based on historical O&M contract trends, systems sizes by population, and contract values. At the same time, this Insight Report zeroes-in on the top O&M service providers.