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What are the economics of reusing treated wastewater?

Are projects to reuse treated wastewater economically profitable for society? To answer that question, Irstea and the Ecofilae consulting firm studied the economics of three projects in France. The study was financed by Onema.

In a context of growing needs for water and of the necessity to adapt to climate change, the availability and preservation of water resources have become a major issue. The reuse of treated wastewater could be a solution for applications that do not require a level of quality equivalent to drinking water. In France, this highly promising technique has been slowed and in some cases halted by regulations reflecting a number of concerns, notably health issues. As a consequence, only a few dozen projects to reuse wastewater have actually been implemented in France and the first date back several decades. Though the reuse of wastewater can theoretically preserve water resources and may be economically profitable for certain private entities, is it in fact beneficial for society as a whole? In other words, is it certain that society has a long-term interest in promoting this type of project?

Cost-benefit analysis

To answer that question, Irstea and the Ecofilae consulting firm ran cost-benefit analyses on existing projects. The analyses consisted of work to identify the present and future costs and benefits, e.g. over 30- and 50-year periods, for society as a whole (project promoters, citizens, funding entities, the State) of a project and to compare them to the costs and benefits of a reference situation in which the project is not implemented. A project is said to be economically profitable if society as a whole draws greater net benefits than if the project did not exist. The three projects analysed dealt with agricultural reuse of wastewater from a sugar factory and from a WWTP near Clermont-Ferrand, watering of a golf course with wastewater from a WWTP in Rhuys-Kerver (Morbihan department) and multiple uses of wastewater from the WWTP in Sainte-Maxime (Var department). Even if some costs and benefits are more difficult to assess, particularly those concerning the environment, the analysis revealed that society gained economically via these project to reuse wastewater.

Identified keys to “success”

A number of factors explained the economic profit to be gained from reuse. First of all, the physical proximity of the WWTP to the potential users of the wastewater (farmers, golf course, etc.) reduced the investment costs for the distribution network. Secondly, the excessively high treatment costs for the water from the sugar factory and the need to meet increased future demand for drinking water in Sainte-Maxime given the urban-development projects there contributed to making the projects economically profitable. Finally, the third key to success was the existence of contractual relations between the suppliers of the treated wastewater and the potential users. For example, in Rhuys-Kerver, the company owning the golf course is a subsidiary of Saur, the company running the WWTP. In Clermont-Ferrand, the farmers who could count on a source of water were also among the suppliers of the sugar beets for the sugar factory. The analysis also revealed the fact that, in certain cases, the participants bearing the costs of projects to reuse wastewater were not necessarily those drawing the greatest benefits. In such cases, the economic analysis can assist in finding financial solutions to compensate the imbalances (water tariffs, modified subsidies), produce win-win situations and ensure a degree of equity in the distribution of the collective benefits. That will certainly be the case in Brittany where the golf course is the main winner, whereas the project promoters and funding entities are confronted with net costs.




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