Skip to main content
Start of main content

Developing wastewater’s circular economy: How do we pay for it?

April 12, 2022

By Arthur Umble

How do we create a paradigm shift? Think like a portfolio manager, but don’t overlook what’s already working.

The circular economy makes sense. Turning “waste”—including plastics, food, electronics, and more—into something new is better for the environment and for human health. It’s a large part of battling climate change.

It’s simple. Even in the wastewater industry, it makes sense.

What’s not so simple is how to pay for it. At least that’s how it appears to many. The challenge of the initial investment to go from our traditional wastewater treatment method to a resource recovery method creates a roadblock for many. But there are long-term benefits—for both the Earth as a whole and for utilities.

It takes both near-term and long-term solutions to turn our traditional wastewater treatment methods into a resource recovery method. But resource recovery is critical to the circular economy.

The solution needs to come in two parts. First, we need near-term solutions. These are projects that can be implemented starting today. The technology is there—we simply must commit to using it. The Stantec Institute for Water Technology & Policy exists to do just that—demonstrate these climate changing solutions are not just technically available, but achievable at any scale. Secondly—and more long-term and paradigm-shifting—we must change how we view utilities and how we pay for them.

I’m going to look at these in reverse order. Let’s start big!

Paradigm shift: Looking at wastewater utilities like a management portfolio

Honestly, the long-standing idea of each community running its own water/wastewater utility is outdated. The utilities are underperforming. They are overburdened by debt.

It feels like a lose-lose scenario. They need to make changes, but they already have too much debt. Where do they go?

There are more than 50,000 drinking water systems in the US. The vast majority, maybe 85% or so, are in communities with a few thousand residents. You can’t just ask some small community in Iowa or Idaho to take on a bunch more debt.

The solution is aggregating these underperforming utilities into a large portfolio of investments. Take 50 of these small water/wastewater systems and put them into one management portfolio.

One solution to underperforming utilities is to put them into a large portfolio of investments. Take 50 small water/wastewater systems and put them into one management portfolio.

It’s like buying stock. You can buy you some Apple or Google, and you can buy something much smaller—maybe even a local startup. You can do the same with water and wastewater utilities.

You’re aggregating all these various utilities—think small, medium, and some larger—into a single portfolio. Once the portfolio is created, now you’re managing it for profits.

This is the paradigm shift.

Each utility continues to serve its community. They are in the best position to do so; they know what works locally. The investor relies on the true life-cycle costs to manage a portfolio, a discipline often ignored or avoided at the utility level due to political pressures.

But isn’t the recently passed infrastructure bill—the one with $500 billion coming out of Washington, DC—really the way to kickstart this? No.

First off, it’s far less than we need. That may seem crazy to say, but $500 billion spread out the way it is, while it’s wonderful to see, isn’t going to give the circular economy the push it needs.

Secondly, it’s still just debt, which is one of our current challenges. Most of the dollars are going to flow through states and their revolving funds. It’s not going to simply be a giant grant. Debt is still part of the discussion.

No, the infrastructure bill is not a panacea. And that takes us back to investing.

What we’re looking at isn’t a 3-year payoff. We’re talking about a 20-to-30-year investment portfolio. That can only happen if you aggregate all these utilities into one management portfolio.

It’s like buying stock. You can buy you some Apple or Google, and you can buy something much smaller—maybe even a local startup. You can do the same with water and wastewater utilities.

Will this happen tomorrow? No.

This is forward-thinking. It’s a vision for the future. It’s where we want to go.

But …

What can we do now?

Since the big picture answer takes a big shift in thinking, we need to reasonably take small steps toward the circular economy.

And we’re already doing that.

We’ve started to redefine our “take-make-dispose” approach to production and consumption. What we’re seeing in the water/wastewater arena is that newer approaches help pay for themselves.

The following are functioning examples of circular economy projects that are helping utilities turn waste into profit.

In my own Colorado neighborhood, Denver’s Metro Water Recovery (Metro) is setting a standard in a couple ways.

First, the Robert W. Hite Treatment Facility removes phosphorus from the wastewater effluent before releasing it into the South Platte River. The phosphorus recovery facility reactor, which opened in late 2020, removes more than 90% of the phosphorus. About 20% is recovered as struvite, which can be reused as a slow-release fertilizer.

With a creative approach, the utility has taken a maintenance nuisance and water quality detriment—excessive phosphorus—and turned it into a money maker. It’s treating the local waterways better, and it has a valuable product—a product that doesn’t have to be mined elsewhere but comes as part of the circular economy. 

The Robert W. Hite Treatment Facility in Denver, Colorado, removes phosphorus from the wastewater effluent before releasing it into the South Platte River. About 20% is recovered as struvite, which can be reused as a slow-release fertilizer.

Secondly, our team worked with Metro on a heat recovery project for heating its campus buildings. In this case, the wastewater isn’t producing a product to sell—it’s producing cost savings. Wastewater has a surprisingly high temperature, mostly from sinks, showers, clothes washing, and dish washing. Using heat-pump technology, the new system recovers the heat from the effluent and heats entire buildings. Instead of buying natural gas to heat their buildings, Metro is simply using the wastewater that it’s responsible for in the first place.

During the past five years, I’ve had the privilege of serving on the Board of Directors for the CLEARAS Water Recovery, Inc. It’s a company focused on the nature-based solution of utilizing microalgae in the treatment of wastewater and generating bioproducts from the microalgae biomass that is reintroduced into commercial markets.

In Roberts, Wisconsin, the village’s WWTP, working with CLEARAS, is turning into a resource recovery facility. In fact, you may be wearing its products right now. The Roberts WWTP uses microalgae to act as biofilters. The algae grow aggressively and are regularly harvested, maintaining the proper balance between the system’s nutrients and algae. The excess algae are a biomaterial. It is processed as needed by buyers. In Roberts, the algae are turned into thermoplastics for use in running shoe soles and in the production of organic inks. The process produces cleaner effluent and a product that the village sells. It’s a win-win.

Remember, small steps help us get on the road to a paradigm shift.

What does the future look like?

We can’t be OK with just doing the status quo—we see where that has put us. We must look at things differently.

Sometimes, utilities are afraid to do something. They are afraid of buyer’s remorse. And, of course, there is risk. But we must also consider the bad consequences from not taking any action.

Honestly, that isn’t an option. We must act on climate change.

How do we pay for it? There are things we can right now with our existing infrastructure. And there is a paradigm shift awaiting. It’s incumbent on all of us to help make it happen.

  • Arthur Umble

    As the lead for Stantec's Institute for Water Technology & Policy, Arthur’s position involves developing strategies and providing solutions for complex wastewater treatment challenges.

    Contact Arthur
End of main content
To top
Run Modes: s7connect,crx3,nosamplecontent,publish,crx3tar
Build Version: 2.5.0.8
Build Date: 2022-43-28 08:43:59