Navigating the Pitfalls: What Investors Should Watch for When Choosing a RAS

Recirculating Aquaculture Systems (RAS) have garnered significant attention in the aquaculture industry in the last ten years or so, promising sustainable, high-yield fish farming with reduced environmental impact.

However, investing in RAS is not without its challenges. Whilst RAS projects can be successful with the right choice of technology, it must still be remembered that 50% of RAS projects have failed so far.

RAS are technically advanced systems where both mechanical and biological processes are involved. Even with some RAS suppliers themselves, there is confusion and lack of understanding of some aspects in RAS design. One cannot expect it to be easy for an investor to navigate through the RAS “Jungle.”

To ensure a profitable and sustainable investment, here are key pitfalls to be aware of when evaluating a RAS project.

1. Overestimated Production Claims

Some projects are based on individuals or groups seeking investments for a proposed RAS project. They have a promising idea.

When you want to attract investment, the better your financial figures look, the easier it is. Aquaculture project promoters often rely on optimistic financial projections that may lack a factual basis — that is the danger.

One of the most common issues in RAS investments is overly ambitious production targets. Some promoters project unrealistically high yields, ignoring biological limits, water quality constraints, and the complexities of fish growth.

As production plans or biological plans are the basis for dimensioning and design of RAS, it is utterly important that input data are realistic. People putting money into a project should scrutinize what is laid in front of them and seek independent verification from aquaculture experts.

In other cases, it is not individuals but companies with finance that wish to invest in aquaculture as a diversification to existing business. Quite often they will employ someone with a degree in aquaculture to become a project leader. But to find someone who is fully competent is a challenge.

It needs in-depth knowledge and long experience to see through pitfalls in the different RAS concepts. For an investor it could be good to have an external “sparring” partner. The main task is to find out what works and what does not.

2. Poor RAS Design and Technology

Production or biological plans are the basis for RAS design. If you do not get this right, then you will not reach your goals.

Of course, if both biological plans are not right and your technology is not right, disaster strikes — and it will be impossible to rectify. That is seen too often.

Again, we in general need to put more focus on “what works.” Even with the 50% mentioned failure rate in RAS projects, it is still possible to find out what works.

RAS Technology: Important Processes

1. Biofilter
2. Solids removal
3. Oxygenation system
4. CO₂ degassing
5. Off-flavor mitigation
6. Steering and alarm systems

The biofilter in a RAS is the “heart” of the system. If it does not work satisfactorily, it does not really matter how well all other processes work — success will be limited.

Moving Bed Bio (MBBR) reactors seem to have the edge over most other biofilter concepts. If correctly configurated, they do not build up excessive biofilms or accumulate sludge. You have the possibility of having biofilm control. This means one has a fresh and active biofilm all the time.

A RAS supplier should always incorporate a certain spare capacity of 10–20% to allow for peak loads and secure good water quality when the unit is fully stocked.

It is imperative to have good solids removal. However, systems that remove solids by accumulating sludge, such as those using settling or certain fixed-bed filters, are not recommended. There will be a risk of Hydrogen Sulfide developing. Likewise, sludge deposits are ideal breeding grounds for the microflora responsible for off-flavor in fish.

Some RAS suppliers attempt solids removal without using drum filters. This may not be advisable, especially for fish species that need good water quality. Drum filters are expensive, but one must accept them as necessary “evils.”

In general, one must avoid biofilms building up in an RAS. CO₂ degassing is often carried out with counter cascade principles. Certain counter cascade CO₂ systems use packing material to improve gas transfer.

However, this packing material will also develop biofilms and can be counterproductive in that they will house microflora responsible for off-flavor problems in fish.

One must be able to clean the packing material at short intervals, or even better, design degassing systems without using packing material — for instance, by nozzle-based counter cascade.

RAS requires significant energy input for water circulation, oxygen injection, and temperature control. If energy efficiency is not carefully planned, operational costs can quickly erode profitability.

Site selection is particularly important. It is not wise to locate cold-water fish species RAS in warmer climates and vice versa.

3. Disease and Biosecurity Risks

While RAS is often marketed as a solution to disease risks associated with open-water farming, it is not immune to pathogen outbreaks.

A poorly managed system can rapidly spread diseases within a closed environment. Investors should review the biosecurity protocols, including:

• Quarantine procedures

• Pathogen monitoring

• Emergency response plans

4. Inexperienced Management Teams

Apart from planning a project, a sophisticated RAS setup requires specialized knowledge in aquaculture, engineering, and system maintenance.

Many failures in RAS investments stem from teams lacking the necessary expertise.

Investors should assess:

• The experience and track record of the management team

• Their understanding of both technology and fish biology

5. Market and Sales Uncertainty

Even with a well-functioning RAS, market access and pricing stability can be major concerns.

Some projects focus on production without securing a clear sales strategy.

Investors should analyze:

• Market demand

• Distribution channels

• Price competitiveness before committing capital.

6. Inadequate Financial Planning

RAS requires substantial upfront capital and ongoing operational expenditure.

Underestimating costs, especially during the early phases, can lead to financial shortfalls.

Investors should ensure that financial models account for:

• Realistic cost structures

• Contingency planning

• Potential delays in achieving profitability

7. Regulatory and Environmental Compliance

Aquaculture regulations vary widely across jurisdictions, and non-compliance can result in costly legal challenges.

Investors should conduct due diligence on:

• Local regulatory requirements

• Environmental impact assessments

• Permitting processes before proceeding with any project.

Conclusion

RAS offers exciting investment opportunities, but success depends on thorough due diligence and risk mitigation.

By being aware of these potential pitfalls and seeking expert advice, investors can make informed decisions that lead to profitable and sustainable aquaculture ventures.

Ivar Warrer-Hansen, founder of RASLogic, was involved with the very first research into RAS.
He has been instrumental in where RAS is today, being involved with some successful RAS projects.