Can Milwaukee become the Silicon Valley of water?

November 9, 2011

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Richard Meeusen’s big dream for Milwaukee was inspired by the sound of a 10,000-gallon tank of water flushing at a lab used for testing new water meters.

“You know, Milwaukee has a history of being built around wet industries,” said Meeusen, pointing to the city’s history of breweries, tanneries and meat packing plants. “Businesses that required a lot of water.”

Richard Meeusen’s big dream for Milwaukee was inspired by the sound of a 10,000-gallon tank of water flushing at a lab used for testing new water meters.

“You know, Milwaukee has a history of being built around wet industries,” said Meeusen, pointing to the city’s history of breweries, tanneries and meat packing plants. “Businesses that required a lot of water.”

Those wet industries are mostly gone, of course, with Miller Beer being the big exception. But Meeusen says the remaining ones present an opportunity, “All of the little companies that located here to serve those wet industries—to make pumps and valves and meters and pipes—have grown up into over 150 companies that represent the greatest concentration of water technology companies in the world,” Meeusen said.

Meeusen runs one of those companies as CEO of Badger Meter, a 106 year-old Milwaukee firm that makes water meters.

Lots of people make a strong case that the world is going to have to get a lot smarter about water, fast. A recent study in the journal Nature reports that eighty percent of the world’s population already experiences “high levels of threat to water security” measurements of rivers in the United States found half to be under stress. It’s already a front-burner issue for cities like Atlanta, Phoenix, and Los Angeles.

Lots of people make a strong case that the world is going to have to get a lot smarter about water, fast. A recent study in the journal Nature reports that eighty percent of the world’s population already experiences “high levels of threat to water security” measurements of rivers in the United States found half to be under stress. It’s already a front-burner issue for cities like Atlanta, Phoenix, and Los Angeles.

Supply is getting to be a real problem, and there’s a lot of demand, not just for drinking water. Large amounts of water go into manufacturing items as varied as computer chips and blue jeans. One pair of Levi’s alone requires 2,900 gallons of water. When supply goes down, price eventually goes up dramatically.

“So, water won’t be treated like air,” said David Zetland, a water economist who teaches in the Netherlands and recently published a book called The End of Abundance. “We’re going to treat it like gasoline.” 

It’s easy to see why a guy who makes water meters sees global water scarcity as a business opportunity. 

“I started to realize that Badger Meter was in a very unique position, because we sell a device that helps control the world’s most precious resource,” Meeusen said.

Richard Meeusen thinks the key to dealing with the impending global water crisis will be technological innovation. Water technology will be to the next few decades what computer tech has been for the last thirty years: The driver of world-transforming innovation.

“About five years ago, I had this vision that Milwaukee could be the Silicon Valley of water tech,” Meeusen said.

Meeusen thinks Milwaukee is going to cash in and has been leading a charge to bring local water-tech companies together with scientists at local universities who study water, aiming to leverage those resources to attract more companies, more investors and more recognition to create a wet Silicon Valley.

Meeusen has built a lot of momentum over the last few years, with buy-in from dozens of local and national companies, a new initiative at the University of Wisconsin at Milwaukee, and about $4 million in federal grant support.

The truest-bluest believers are in Milwaukee’s city government. The city’s economic development director, Rocky Marcoux, took us to see a disused rail yard near the Harley-Davidson Museum that the city is promoting as a business incubator called the Reed Street Yards.

“We’re going to be marketing this land almost exclusively to water-related companies,” Marcoux said. Marcoux expects the Reed Street Yards and other water-related initiatives to produce what Milwaukee needs most: jobs. “It’s going to have thousands of jobs associated with it.”

Mayor Tom Barnett is also on board. “We are bringing together government, industry and academia to promote our economic agenda which is create more jobs.”

Kevin Shafer, director of Milwaukee’s sewage district, also says it has potential. “Jobs, jobs, jobs, jobs, jobs,” Shafer said about the initiative’s potential impact.

Those involved are cautious to give numbers about the actual amount of jobs that may be created. “Well, we don’t play that game,” Meeusen said. “I don’t want to get into a numbers game, I’m not trying to compete in that.”

But when it comes to jobs in Milwaukee, numbers matter because the city needs them so badly. It’s the fourth-poorest city in the country. Unemployment is 29 percent among African-Americans—more than 50 percent among African-American men. And no matter how many high-skill water-technology jobs get created, they’re unlikely to make a difference to the people who need jobs most.

“Are these highly technical jobs?” said Mike Brever, who operates three food pantries in the Milwaukee area and sees the desperation every day. “Or are these the type of jobs that a 35-year-old person who’s flinging burgers at McDonald’s right now because they’ve got nothing else, can quit McDonald’s and step right into that job?”

Brever pointed to the kind of low-skill manufacturing jobs that have disappeared from Milwaukee and cities all across the Great Lakes region. Badger Meter, while promoting Milwaukee as a wet Silicon Valley has actually been exporting those kinds of jobs from Milwaukee to places like Nogales, Mexico for years.

That contradiction is not lost on the Water Council’s major critic, Marc Levine, who runs UW Milwaukee’s Center for Economic Development,“It seems to me that’s a prima facie example of how outlandishly hyped the Silicon Valley of Water idea really is,” Levine said.

Levine agrees that it’s not improbable that Milwaukee may end up on a short list of cities that establish themselves as leaders in water technology. Toronto and Singapore are a couple of others that are in the running. Levine argues that city and business leaders’ focus on water to the exclusion of other urgent issues is a risky strategy for Milwaukee.

“The harm is obviously that this initiative is sucking up an incredible amount of public energy,” Levine said. “That resources and energy will be monopolized by an initiative that will not deliver the kinds of economic development results that we need. You know, serious ways of meeting a very serious litany of problems that the community faces.”

Despite these concerns, the Water Council and its partners are plowing ahead.  The School of Freshwater Studies at UW Milwaukee just hired its first Dean, and in late September the federal government announced three separate grants to the Water Council and its partners.

Zetland, who predicts that water will be treated like it is limited and like gasoline, has followed Milwaukee’s push closely. The city’s water council invited Zetland to speak at its Global Water Summit in September and has questioned the idea of Milwaukee becoming like Silicon Valley.

“You hear that claim all the time from politicians in various parts of the world—the Silicon Valley of this and that,” Zetland said. “There’s some potential there. Milwaukee’s got a lot of stuff going for it, and water is one of them, but if I were on the city council, I wouldn’t come close to hanging even half of my hat on water as a solution or the future of the city.”

Zetland’s not alone in saying there is no one solution to the region’s woes. Could water technology give Milwaukee a lift?   Sure. But for now, there is only one Silicon Valley and it is 2,000 miles away in California. 

Production assistance and additional reporting by Tanveer Ali.