The move to curb industrial and other facility emissions is pushing a lot more  air-pollution control work to firms, prompting nearly a doubling of 2006 revenue in that category, with significantly higher numbers likely in future surveys.

Hazardous waste cleanup, including  brownfields, asbestos and lead abatement, remained the market leader. The Top 200 category boosted its total nearly 24% on the strength of more private-sector spending, twice last year’s increase. Government-driven nuclear waste cleanup, however, is maturing as U.S. Dept. of Energy site remediation is completed. The market category saw a 30.5% revenue falloff in 2006, which could also be related to EnergySolutions’ non-appearance on the list. But new DOE site cleanup contracts and work in the budding U.K. nuclear site cleanup market  are expected this year.

C. H. Nickerson Staffing environmental jobs will challenge and constrain Top 200 firms.

“We’ve seen a huge growth in brownfield spending and a growing industrial hygiene business,” says Chris Vincze, CEO of engineer TRC Cos., ranked 39th on the list after a two-year absence amid a company turnaround from previous losses. “As corporations earn well, they will spend money to clean up old sites,” he says. “Sarbanes-Oxley requirements are pushing that.”

CDM’s Fox says the market “has stayed surprisingly strong, both privately and federally. Both have shifted their focus to delivery.” He notes that companies and agencies “just want the projects off the books, and there is a heavy focus on design-build to get it done. I think that has kept the market very robust.” Fox notes a major shift toward biological cleanup approaches such as bioaugmentation and away from the traditional pump-and-treat.

“Design-build was our biggest source of growth,” says Fox. “We were well positioned for that growth because it was heavily water- and hazardous-waste based.”

The new design-build markets are the result of a shift in priorities. “Three years ago, we wouldn’t have been focused on that delivery system with federal clients,” Fox says. “But people are beyond planning and site investigations, they want it done. Governments are suffering from the same brain drain as industry, so they want to get these projects out of the pipeline.”

East Bay MUA Aging environmental infrastructure will continue to require firms’ services.

With the aging of the workforce, many governmental clients are having trouble recruiting enough talent to manage programs internally. Consequently owners are looking to outsource to contractors. “There is a lot of program management work out there. Clients have shrinking talent pools, so they have trouble getting people who can run their programs,” says Fox. “They rely on the private sector to manage their projects.”

This shift in philosophy is evident on five-year, $200-million project at the  U.S. Marine Corp.’s Camp Pendleton in Florida, to bring the base’s water, wastewater and  solid-waste treatment facilities up to standards, Fox says. “We are performing the work on a task-order basis. That was a real switch in how the government does business,” he says.

Opportunities Abound

Abatement giant LVI Services Inc. anticipates $350 million in revenue in 2007, says President and CEO Robert McNamara. “The market is affording us some good opportunities without acquisitions,” he says. “We think a 10%-15% annual growth is achievable.”

Frank Hyman/APM Terminals of North America Dredging and marine restoration work is surging for environmental firms.

Aside from continuing cleanup in heavily storm-hit southern regions, the firm is pushing services to national retail chains and other multi-unit commercial clients. “It gives us an ability to service them on a national scale,” says McNamara. “Our emergency-response growth will be 20% to 25% this year, and we make a major investment every year that continues to advance our equipment, things that can help with water, smoke damage and mold remediation.”

Commercial clients make up two-thirds of LVI’s client base, but the market is “choppy,” says McNamara. “There are parts that are very robust, and other areas that are quiet.” He sees potential in industrial sectors, particularly in aging power facilities, and in government work pushed by base closings.  “We see a future ability to grow our government work by 20%,” says McNamara, who anticipates the three sectors eventually offering a balance of revenue to LVI.

“Our number-one challenge is to create systems and technologies that allow us to be more cost-competitive for our clients,” says McNamara. “We largely self-perform our work, with 3,000 to 4,000 people in the field on any given day. We’ve made a significant investment to keep them well trained. Self-performing work allows us some early certainty with our client on cost and schedule.”

But LVI also joined the acquisition craze, boosting its demolition capabilities with the June 18 purchase of Mazzocchi Wrecking, the seventh-largest U.S. firm in that sector. “The acquisition catapults us to being the largest abatement and demolition contractor in the U.S.,” says McNamara. “Mazzocchi also has the most capable high-reach demolition fleet in the U.S.” He says international expansion “is on the radar screen,” but the active U.S. market will sustain LVI’s growth needs for now.

Black & Veatch’s rise on ENR’s list came partially as a result of the acquisition last fall of U.K.-based MJ Gleeson’s water business. The unit, with annual revenue of nearly $380 million, more than doubles the size of Black & Veatch’s existing U.K. water operations.

Underground Solutions Inc. More work flows from water supply projects.

Black & Veatch’s water business has also expanded in Australia. In December, the firm, in association with Melbourne, Australia-based Sinclair Knight Merz and Queensland, Australia-based Thiess, formed an alliance with Australia’s Water Corp. to manage its wastewater treatment program in Perth. The western Australia government will provide $270 million to upgrade its three largest wastewater treatment plants and has committed to be carbon-neutral by 2015, McCarthy notes. Wastewater treatment and water supply market niches both enjoyed double-digit growth in 2006.

The Top 200 firms seem to have never met an anti-pollution regulation they did not like. “Arsenic has been very good to us, and radium has been very good to us,” says Greg Aluce, senior vice president of Layne Christensen Co., which specializes in contaminant removal from groundwater, among other things. “It’s all driven by regulation, and there’s more coming down the pike. But now, we’re well positioned and understand the market,” he says, noting the firm’s 2005 acquisition of Reynolds Inc.

Terry Neimeyer, CEO of KCI Technologies, says U.S. cities are signing consent decrees with the Environmental Protection Agency to clean up overflows and comply with federal standards. KCI is involved with Baltimore’s $900-million effort to upgrade wastewater facilities by 2016 under a 2002 EPA consent decree.

DYK Water and wastewater projects are on a fast track in Qatar.

The firm was also selected by the North Carolina Dept. of Environmental Resources to restore storm-damaged wetlands so other areas in the state can be developed. It is managing 10 wetlands mitigation banking projects, which will be completed by the end of 2007 but will require five more years of maintenance.

The federally pushed multibillion-dollar Everglades restoration program in Florida continues to provide work for environmental contractors. Black & Veatch is involved in design of the Everglades Agricultural Reservoir, a 15,000-acre-facility that will include a 3,000-cu-ft-per-second pumping station and related outlet-control structures. The construction joint venture of Bozeman, Mont.-based Barnard and Parsons Corp. has already begun excavation of seepage canals and construction of a rock processing plant.

“There is great demand for clean- water work in Connecticut,” says Jonathan Miller, president of locally based contractor C.H. Nickerson, whose revenue rose 70% in 2006 and whose rank went up 29 steps. “A lot of it has been in design for the past four or five years.”

Miller says the Long Island Sound nitrogen reduction initiative has spurred much of this work and will continue to over the next five to 10 years. C.H. Nickerson anticipated the work and positioned itself to take advantage of the market boom.

“We have been bringing up a lot of young managers and superintendents over the past couple of years to get ready for this initiative,” Miller says. “Several years...

 

...only one that was not a power company and was familiar with water recycling issues, claims Van der Venter, who notes a similar project being discussed in Provincetown, Mass. “There are many opportunities for new technology in this,” he says.