How can India Manage the Reuse of Treated Wastewater?

REPORT

Reuse of Treated Wastewater in India

Market Potential and Recommendations for Strengthening Governance

28 March, 2023

Nitin Bassi, Saiba Gupta, Kartikey Chaturvedi

Suggested citation: Nitin Bassi, Saiba Gupta, and Kartikey Chaturvedi. 2023. Reuse of Treated Wastewater in India: Market Potential and Recommendations for Strengthening Governance. New Delhi: Council on Energy, Environment and Water.

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Overview

Given the exponential amount of wastewater generated in the country, India has immense potential to meet the growing water demand across different sectors and improve its water environment with proper wastewater management. This study presents the case for mainstreaming the reuse of treated wastewater in India. It assesses the economic and market potential for the reuse of treated wastewater (domestic sewage) for irrigation at the national scale and makes recommendations to strengthen the existing governance on reuse.

Key Findings

INR 630 million would have been the market value of the total available treated wastewater in 2021, had there been a mechanism in place to sell treated wastewater to different sectors for reuse. The market value will substantially increase to over INR 830 million in 2025 and INR 1.9 billion in 2050 at the current market rate.
Nine times the area of New Delhi could have been irrigated using the treated wastewater available in India for the irrigation sector in 2021. Further, about INR 966 billion would have been the revenue generated from the agricultural yield produced from this area of land.
Over 6,000 metric tonnes (MT) of nutrients could have been recovered from the available treated wastewater in 2021, generating savings of more than INR 50 million on account of the corresponding reduction in synthetic fertiliser use.
Reusing treated wastewater in irrigation could have reduced greenhouse gas (GHG) emissions by 1.3 million tonnes in 2021.

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Nitin Bassi

Programme Lead

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“Promoting reuse of treated wastewater will lead to several benefits and positive externalities for India. There is a huge market potential for reusing it for irrigation alone provided financially viable models are developed to scale up wastewater treatment and reuse.”

Executive summary

Water security is an imminent issue in India. As per our analysis using the Central Water Commission (CWC) estimates on basin-wise water availability (CWC 2021), 11 out of the 15 major river basins in India will experience water stress by 2025, with annual per capita renewable water availability below 1,700 cubic metres. Hence, it is essential to explore alternative sources of water to address the demand–supply gap.

India treats only 28 per cent of the total sewage it generates per day from the urban centres (CPCB 2021). Out of the 72,368 million litres per day (MLD) of sewage produced in urban centres, the actual treatment is of only 20,236 MLD (CPCB 2021). Class I cities (those whose population is above 1,00,000) and class II cities (with populations of 50,000–99,999), which represent a major share (72 per cent) of the total urban population, produce an estimated 38,254 MLD of sewage, of which only 30 per cent is actually treated (CPCB 2021). The untreated wastewater is then discharged into freshwater bodies, such as rivers.

Given the exponential amount of wastewater generated in the country, India has immense potential to meet the growing water demand across different sectors and improve the water environment with proper management. Through this study, we intend to estimate the market potential for the reuse of treated wastewater (domestic sewage) at the national scale and make recommendations to strengthen the existing governance on reuse.

Approach

We undertook the following:

Estimation of the amount of treated wastewater (TWW) that can replace the equivalent freshwater demand in different sectors for non-potable purposes
Computation of the economic and market potential for the reuse of TWW with emphasis on the irrigation sector, which is the major consumer of freshwater
A review and analysis of existing state policies on the reuse of TWW in India with the help of an analytical framework
An analysis of selected best global practices in the reuse of treated wastewater in terms of the key enablers, drivers, and barriers
Compilation of recommendations for strengthening the existing governance on the reuse of TWW in India

Economic and market potential of TWW reuse

11,622 million cubic metres (MCM) is the estimated amount of treated wastewater that was available in India for reuse in 2021. Based on projected sewage generation and treatment capacities in the future, this will become 15,288 MCM by 2025 and 35,178 MCM by 2050.
Nine times the area of New Delhi could have been irrigated using the available TWW in 2021. Based on our analysis, about 8,603 MCM of treated wastewater was available for reuse in the irrigation sector in 2021; this could have replaced the equivalent freshwater demand for irrigation. It had the potential to irrigate 1.38 million hectares (Mha) of land, which is equivalent to about nine times the area of New Delhi (Figure ES1). By 2050, this would go up to about twenty-six times the area of New Delhi.

Figure ES1: 1.38 Mha area could have been irrigated using the TWW available in 2021

Source: Authors’ analysis using data from the Report of National Commission for Integrated Water Resources Development Plan (1999), Ministry of Water Resources (MoWR), Government of India

Reusing TWW for irrigation in 2021 could have generated INR 966 billion in revenue. We estimate that 28 million metric tonnes (MT) of the produce of selected horticulture crops could have been generated using the available treated wastewater for irrigation in 2021. This produce could have further generated revenue of INR 966 billion (Figure ES2).

Figure ES2: Irrigation using TWW in 2021 could have generated INR 966 billion in revenue

Source: Authors’ analysis using data from Horticulture Statistics at a Glance 2018 (Dept. of Agriculture Cooperation and Farmers, GoI); National Horticulture Board 2022

Around 6,000 MT of nutrients could have been recovered from the available TWW in 2021, generating savings of INR 50 million. As per our estimates, the nutrients supplied by currently available TWW (for irrigation use in 2021) amount to more than 6,000 metric tonnes. Further, considering the market value of the nutrient load, we estimate that the total savings from the reduction in fertiliser use through irrigation using TWW would have been more than INR 50 million (Figure ES3).

Figure ES3: INR 50 million could have been saved through the reduction in fertiliser use by using TWW for irrigation in 2021

Source: Authors’ analysis using data from Circular Economy in Municipal Solid and Liquid Waste (2021), Ministry of Housing and Urban Affairs (MoHUA), Government of India (GOI)

Reusing TWW in irrigation could have reduced greenhouse gas (GHG) emissions by 1.3 million tonnes in 2021. Our analysis suggests that the available treated wastewater would have irrigated 1.38 Mha in 2021, which would have reduced pumping in 3.5 per cent of the groundwater-irrigated area. Further, this would have led to a reduction of 1 million tonnes of GHG emissions. Additionally, on account of the inherent nutrient value of TWW, fertiliser consumption would have reduced, resulting in further reduction of GHG emissions by 0.3 million tonnes.
INR 630 million would have been the market value of treated wastewater in 2021. Our analysis suggests that the market value of the treated wastewater available in 2021 (11,622 MCM) would have been over INR 630 million, if we had the mechanism to sell treated wastewater to different sectors for reuse. The market value will substantially increase to over INR 830 million in 2025 and INR 1.9 billion in 2050 at the current market rate.

Review of existing state policies on treated wastewater reuse

We undertook this analysis to understand the comprehensiveness of the TWW reuse policies of Indian states and to determine whether they will be able to realise the market potential of the TWW in the future. We found that only 10 states in India have a TWW reuse policy and the following key gaps need to be addressed:

Only a few states identify the positive externalities associated with the treatment of wastewater and reuse. These include improvement in the water quality of receiving natural water bodies and the associated public health impacts.
Only a few policies prioritise sectors for reuse. Also, only a few policies classify TWW into mandatory and non-mandatory reuse.
Most policies make only a brief recommendation on the technologies for wastewater treatment. A majority of the state policies that we reviewed do not provide details on the treatment process and technologies. Further, they make only a brief mention of the tertiary treatment process and technologies.
Most policies do not consider the allocation principles for TWW. They lack the enforcement mechanism that provides a blueprint for their effective implementation.
There is no discussion on the incentives to encourage the reuse of TWW. Most state policies do not have any provisions for incentives for end users, which can promote the reuse of TWW.
Most policies do not define the role of external stakeholders, such as community or industrial groups. Such a description is important from the perspective of community acceptance of TWW for reuse at large.
TWW quality standards are not defined for the specific purpose of reuse. Most state policies provide Central Pollution Control Board (CPCB) or State Pollution Control Board (SPCB) TWW discharge standards. However, they do not define treated wastewater quality standards for specific reuse purposes.
Most policies do not define binding provisions to aid effective implementation. Though majority of the state policies refer to various central and state acts as their regulatory framework, there is very limited mention of the binding provisions required for policy implementation.
The criteria for the selection of appropriate business models is not defined. Almost all state policies call for public–private partnerships (PPP) for developing TWW reuse projects. However, they do not include the criteria for the selection of appropriate business models for effective implementation.

We must note that though the national framework on the safe reuse of treated water that was launched in January 2023 provides guidelines on some of the identified gaps, the state policies were launched much before and need revision to address these gaps comprehensively.

Learning from the global best practices

Based on our analysis of three selected countries (Spain, Israel, and Singapore) that are at an advanced stage in their reuse of treated wastewater, we identified key drivers, barriers, and enablers, which we present in Figure ES4.

Figure ES4: Globally, strong governance was the key enabler for the effective implementation of the TWW reuse policy

Source: Authors’ analysis

Recommendations

On the basis of the review of existing state policies and learnings from global best practices, we make the following recommendations to strengthen the existing governance on the reuse of treated wastewater in India:

Make a paradigm shift in ideology: Wastewater needs to be considered an integral part of water resources and hence addressed in all water management related policies, plans, and regulations. Also, the potential of TWW as an alternative source of water needs to be recognised.
Define water quality standards: Water quality standards for both safe discharge and reuse need to be well defined with a risk-reducing approach and a periodic review mechanism in place for regular monitoring and assessment.
Set robust institutional mechanisms: Urban local bodies should be empowered to formulate and adopt long-term, city-level wastewater reuse plans, with roles and responsibilities clearly defined. Further, the institutional arrangement should incorporate the engagement of end-user groups for the successful implementation of reuse projects.
Improve financial viability: Targeted performance-based incentives for the operators/end-users of wastewater treatment plants, and an effective pricing mechanism based on the market potential of the TWW and considering different categories of end-users and their paying abilities, can act as catalysts to improve the financial viability of reuse projects.
Leverage technological developments: Need-based and demand-driven technological advancements are essential to upholding the efficiency and effectiveness of wastewater treatment. For this purpose, we need dedicated funds for the research and development of such technologies, which can optimise resource efficiency. Indian states need to come out with a clear strategy for research and development in this sphere, especially focusing on low-cost, highly energy-efficient technological innovations that could be in cooperation with other relevant global actors.
Invest in public outreach: Indian states should develop effective public outreach plans to build public confidence and nudge behaviour for the successful implementation of wastewater reuse projects.