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Desalination 188 (2006) 185–194 0011-9164/06/$– See front matter © 2006 Elsevier B.V. All rights reserved Presented at the International Conference on Integrated Concepts on Water Recycling, Wollongong, NSW Australia, 14–17 February 2005. A recycled water strategy for regional urban communities S.S. Coutts GWMWater, Horsham, VIC, 3400, Australia Tel. +61 (3) 5362-0244; Fax +61 (3) 5381-9881; email: [email protected] Received 15 November 2004; accepted 29 April 2005 Abstract The efficient use of water to meet the social, economic and environmental needs of our communities is becoming a consistent theme throughout much of Australia. This is particularly important for the Grampians Wimmera Mallee Water (GWMWater) region, especially given the extremely dry period currently being experienced. One of the options attracting the interest of government, community and industry as an accepted alternative to the finite limited fresh water supplies, is the use of recycled water, or treated wastewater. For over 30 years GWMWater has led the Victorian Water industry in recycled water use, with now over 92% reuse of urban wastewater now used within the region. GWMWater supplies over 30 customers with recycled water and has developed a process that assesses the technical, environmental, economic and social aspects of recycled water initiatives. A recycled water strategy has been development based on sustainability (Triple Bottom Line) principles and seeks to balance the development needs for water with emerging environmental imperatives [1]. To strengthen the process, GWMWater engages the community and stakeholders in the assessment and decision-making process, resulting in improved understanding of recycled water use viability issues and management requirements. Keywords: Recycled water; Sustainability; Triple Bottom Line; Consultation; Integration 1. Introducing GWMWater GWMWater is a regional water authority that operates in the western and northwestern region of Victoria. The Authority provides water to 7,000 rural customers for stock, domestic and irrigation use, and supplies water to 52,000 urban customers living in 74 towns, as well as providing sewerage services to 21 towns. GWMWater provides urban services to the largest geographical region in the State, which encompasses in excess of 60,000 km 2 or around 25% of the State. doi:10.1016/j.desal.2005.04.116

A recycled water strategy for regional urban communities

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Desalination 188 (2006) 185–194

0011-9164/06/$– See front matter © 2006 Elsevier B.V. All rights reserved

Presented at the International Conference on Integrated Concepts on Water Recycling, Wollongong, NSW Australia,14–17 February 2005.

A recycled water strategy for regional urban communities

S.S. CouttsGWMWater, Horsham, VIC, 3400, Australia

Tel. +61 (3) 5362-0244; Fax +61 (3) 5381-9881; email: [email protected]

Received 15 November 2004; accepted 29 April 2005

Abstract

The efficient use of water to meet the social, economic and environmental needs of our communities is becominga consistent theme throughout much of Australia. This is particularly important for the Grampians Wimmera MalleeWater (GWMWater) region, especially given the extremely dry period currently being experienced. One of theoptions attracting the interest of government, community and industry as an accepted alternative to the finite limitedfresh water supplies, is the use of recycled water, or treated wastewater. For over 30 years GWMWater has led theVictorian Water industry in recycled water use, with now over 92% reuse of urban wastewater now used within theregion. GWMWater supplies over 30 customers with recycled water and has developed a process that assesses thetechnical, environmental, economic and social aspects of recycled water initiatives. A recycled water strategy hasbeen development based on sustainability (Triple Bottom Line) principles and seeks to balance the developmentneeds for water with emerging environmental imperatives [1]. To strengthen the process, GWMWater engages thecommunity and stakeholders in the assessment and decision-making process, resulting in improved understandingof recycled water use viability issues and management requirements.

Keywords: Recycled water; Sustainability; Triple Bottom Line; Consultation; Integration

1. Introducing GWMWater

GWMWater is a regional water authority thatoperates in the western and northwestern regionof Victoria. The Authority provides water to 7,000rural customers for stock, domestic and irrigation

use, and supplies water to 52,000 urban customersliving in 74 towns, as well as providing sewerageservices to 21 towns. GWMWater provides urbanservices to the largest geographical region in theState, which encompasses in excess of 60,000 km2

or around 25% of the State.

doi:10.1016/j.desal.2005.04.116

186 S.S. Coutts / Desalination 188 (2006) 185–194

2. Recycled water — an increasingly valuableresource

The efficient use of water to meet the social,economic and environmental needs of our com-munity is becoming a major priority throughoutAustralia. This is particularly important forGWMWater, especially given the prolonged andextremely dry period that continues to be expe-rienced in western Victoria.

Recycled water derived from wastewatercollected by urban sewerage systems is attractingthe interest of government, the community andindustry, and there is an increasing acceptance ofusing recycled water as an alternative to, or sub-stitute for, limited fresh water supplies.

In June 2004, the Victorian Government re-leased “Securing Our Water Future Together” [2](also known as the White Paper) which outlinesthe agenda for future water management inVictoria. The water reform package contained inthe White Paper articulates policies and actionsfor smarter sustainable management and use ofrecycled water across the State.

3. The GWMWater’s experience with recycledwater

Over 32 years, GWMWater has been able tosupply recycled water for community benefit andregional development. GWMWater supplies 30third party customers with recycled water forirrigation use on vineyard operations, olive planta-tions, agricultural lands and a plant breeding andresearch facility. Watering of community facilitiesoccurs on golf courses, racetracks, cemeteries andother recreational facilities such as public gardens,sporting ovals and tennis courts.

In 2002/03, only 3.5% of the total volume ofwastewater collected was discharged to naturalsurface water systems, and this was furtherreduced to around 1% in 2003/04. GWMWaterhas almost recycled in full the urban wastewater

generated within the region, with several note-worthy schemes in operation at Horsham, Ararat,Charlton and Warracknabeal. However, it is recog-nised that scope still exists to improve the way inwhich recycled water is beneficially used withinthe region.

Wastewater is treated to a secondary standard,or Class C requirement, at all wastewater treatmentplants [3].

4. The GWMWater Recycled Water Strategy

A Recycled Water Strategy for the GrampiansWimmera Mallee region has recently been de-veloped, which provides a definitive and mea-surable means of assessing the efficiency, effec-tiveness and sustainability of both current andfuture recycled water initiatives.

GWMWater recognised the need for a bettermanagement approach — one that is not “regula-tory driven”, allowing the “true value” of recycledwater to be captured and the corresponding bene-fits to be realised.

The Recycled Water Strategy builds on 32years of knowledge, experience and capability thatGWMWater has developed through the existingschemes and supply arrangements [4].

The Strategy contains key guidelines andcriteria that enable future recycled water initiativesto be quantitatively assessed, as well as enablingexisting schemes to be benchmarked.

The strategic framework for assessment ofrecycled water initiatives that underpins the Stra-tegy, integrates the technical, environmental, eco-nomic and social aspects, or “Triple Bottom Line”(TBL) principles. It seeks to provide a balancebetween development needs for water and emerg-ing environmental imperatives, through commu-nity and stakeholder involvement.

The community are engaged in the develop-ment of the recycled water initiatives, which pro-motes an improved understanding by the commu-nity and interested parties of recycled water use,viability issues and management requirements.

S.S. Coutts / Desalination 188 (2006) 185–194 187

5. The GWMWater Recycled Water Framework

Fig. 1 provides an overview of the RecycledWater Framework, which has been implementedin part recently with the Mallee town of Ouyen,and the experience at Ouyen will be used toillustrate the application of the framework. A newsewerage scheme is presently being constructedat Ouyen, and recycled water is expected to beavailable for beneficial use by 2007. The casestudy presented in Section 5.1 of this paper detailsthe progress to date on the implementation of thestrategic framework at Ouyen.

5.1. The Recycled Water Framework

5.1.1. Step 1: Policy statement

The policy statement should provide a clearindication of the strategic intentions for the useof recycled water, for example the commitmentby GWMWater to achieving recycled water usein full. Further reference to sustainable use of re-cycled water is also presented in the corporate planand the environment policy of the organisation.

5.1.2. Step 2: Integrated water resource plan-ning

A detailed review of water resources, regionaldevelopment, environmental and social issues wasundertaken to feed into the integrated water re-source planning step. This step highlighted thefollowing potential options for recycled water useat Ouyen.• Retention of community recreation areas,

which could also result in water savingsthrough substitution for current freshwater use

• Development of high value horticulture toenable diversification in the agricultural sector

• Development of an artificial wetland or wood-lot for community amenity and environmentalpurposes.

5.1.3. Step 3: Technical assessment and com-munity/ stakeholder consultation

5.1.3.1. Technical sieve

The use of recycled water is constrained by anumber of “technical” factors relating to the risksassociated with the recycled water itself, thephysical features of the local area and existing/potential land use. By considering these factorsearly in the process, potential options can benarrowed down, or “sieved out”, from those thatare feasible. Factors that should be considered aresummarised in Table 1.

5.1.3.2. Stakeholder consultation and engage-ment in decision making

Effective engagement is essential to buildingsustainable recycled water schemes. It has beenimportant to captivate potential beneficiaries byunderstanding their role and the potential gainsbefore approaching them. A thorough knowledgeof the integrated water resources in the region(Step 2 shown on Fig. 1) allows GWMWater toengage the community with a better understandingof areas of interest and potential benefits available.This also provides a better appreciation of particu-lar constraints that may inhibit further progress.

Consultation and education has occurred in twostages at Ouyen. An initial Expression of Interest(EOI) workshop was held to inform stakeholdersof the process and provide them with an oppor-tunity to lodge an application of their interest(EOI) in the use of recycled water. Invitations tothe workshop were in the form of mailed leafletsto the whole community, advertisements in localpapers and direct letters to key stakeholders thatwere identified at the integrated water resourceplanning stage. Prospective customers partici-pating in the workshop were then asked to submitan EOI for the use of recycled water. Table 2 liststhe likely groups and individuals engaged in thisprocess.

The EOI workshop is then followed up with atechnical workshop that focuses more specifically

188 S.S. Coutts / Desalination 188 (2006) 185–194

Fig. 1. Outline of the Recycled Water Framework.

S.S. Coutts / Desalination 188 (2006) 185–194 189

Table 1Technical sieve applied at Ouyen

Element Data Recycled water Class Class C Salinity 1000–1500 EC Nutrients 25–30 nitrogen, 12 phosphorus Toxicants No industry at Ouyen, except saleyards. Volume 60–80 ML/annum (expected) Natural features Soils Generally sandy soils. Topography Flat to undulating Vegetation Some significant sites to the west/south of town. Surface waters No waterways in/near Ouyen. Groundwater Similar across area. Groundwater not of high quality.

Existing infrastructure Limited existing infrastructure. Existing/ potential land use Management experience Likely to be experience in recreation management only.

Viability New horticulture irrigation, retention of community recreation, wetland creation /woodlots

on Victorian Environment Protection Authority(EPA) requirements, technical issues and commu-nity concerns with recycled water use. Stake-holders and customers who expressed an interestat the first workshop were invited to this followup session.

Participants in the technical workshop areengaged in the decision making process through

Table 2Participants involved in Ouyen consultation sessions

Stakeholder Interest EPA Compliance, continuous improvement and environmental sustainability Rural City of Mildura Benefits include social amenity, economic development and planning. Ouyen Inc. (local progress association) Relevant regional development and social amenity. Mallee CMA/DSE/ environmental groups

Environmental benefits and compliance

Local community Possible benefits include protection of public health/amenity, recreation, and improvement of open spaces.

Community groups The golf club, trotting club, bowls club, tennis/football club, recreation reserve and schools.

Private users Private users might include local farmers, the saleyards and a caravan park. Consultation has increased interest in use of the recycled water.

GWMWater Potential for reduced water supply costs, reduced demand and compliance.

their interaction and involvement in the setting ofcriteria weightings. The weightings are used toassess and evaluate recycled water proposals thatare received from prospective customers after thetwo workshops. These submissions require agreater level of detail on proposal and need to bedeveloped with sustainability principles in mind.This is discussed in more detail in Step 4 below.

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5.1.4. Step 4: Evaluation of submissions

5.1.4.1. Weighting and criteria

The Victorian Government states that, ‘Waterrecycling should be supported to the extent thatthere is a positive triple bottom line benefit’ [5].

Step 4 assesses the technical submissions basedon a multi-criteria assessment technique. As partof the practical application of the technique, com-munity and stakeholder input was supplied atOuyen to determine the priorities and weights forthe evaluation of the submissions. This evaluationstep was developed with consultation from Vic-torian Department of Sustainability and Environ-ment (DSE), at a time when the “Draft Guidelinesfor Planning and Reporting Recycled WaterPrograms” were also being developed [6].

Table 3 outlines the criteria used to evaluatesubmissions and the actual weightings determinedby the Ouyen stakeholders that participated in thesecond consultation session (Step 3 of the frame-work). This process of engaging the communityin developing the weightings ensures conflictingconcerns are taken into account and provides fora more credible outcome.

5.1.4.2. Scoring submissions

The score for each option (presented in Table 4)is determined relative to a base-case option, whichgenerally represents a low value use in terms of

Table 3Weighting and criteria

Table 4The scoring system

Criteria Weight (%) Environmental impacts 10 Water resource impacts 10 Regional development impacts 15 Social impacts 30 Technical factors 10 Costs and benefits 15 Risk factors 10 Total 100

Impact Score Very much better +4 Much better +3 Moderately better +2 Little better. +1 No change 0 Little worse. –1 Moderately worse –2 Much worse –3 Very much worse –4

financial return, for example pasture irrigation onadjoining land. GWMWater assessed each pro-posal at Ouyen in order to maintain confidentiality,with each submission assessed and scored as betteror worse than the base case.

5.1.4.3. Assessment of submissions

To ensure confidentiality for individual sub-missions, the proposed options presented inTable 5 do not describe or represent any of theactual submissions received from the Ouyen com-munity, but provide a hypothetical example toshow how submissions are evaluated.

Table 6 shows the four hypothetical proposalsusing the weightings and scoring system inTables 3 and 4, and this evaluation confirms whe-ther the proposals can generate an overall sustain-able outcome that are greater in value than thebase-case. In this example, all four proposalswould generate positive sustainability benefits.However, given the amount of recycled wateravailable, only one option can be chosen and so,in this case, the preferred option would involvedistributing recycled water to the golf course,closely followed by the establishment of a com-munity woodlot.

The final index and outcome on the assessmentof each of the options are subject to challengethrough a sensitivity analysis and a sanity check.In a situation where two options would generate

S.S. Coutts / Desalination 188 (2006) 185–194 191

Table 5Example of recycled water use proposals

Table 6Outcome of sustainability evaluation

Submission 1: Retail sales

Submission 2: Golf course

Submission 3: Community Woodlot

Submission 4: 3rd pipe residential

Construction of a pipeline to provide Class C recycled water to potential new horticultural developments within 15 km of the WWTP.

Supplying Class A recycled water to irrigate the local public golf course, which currently has dry fairways and relies on town supplies for its greens. (Substitution)

Providing Class C recycled water for use by a committee of volunteers for a community tree lot for firewood.

Supplying Class A recycled water for retrofitting residential development for use in toilet flushing and garden watering.

Criteria Weight (%) Retail sales Golf course Wood lot 3rd pipe Environmental impacts 10 +2 0.2 +2 0.2 +2 0.2 +2 0.2 Water resource impacts 10 +1 0.1 +3 0.3 +1 0.1 +4 0.4 Regional development impacts

15 +3 0.45 +1 0.15 +2 0.3 +1 0.15

Social impacts 30 +2 0.6 +4 1.2 +3 0.9 +2 0.6 Technical factors 10 0 0 –2 –0.2 +1 0.1 –3 –0.3 Costs and benefits 15 –3 –0.45 –2 –0.3 –2 –0.3 –4 –0.6 Risk factors 10 –3 –0.3 –1 –0.1 –1 –0.1 –3 –0.3 Total 0.6 1.25 1.2 0.15

similar benefits, further community consultationto determine the preferred option for the commu-nity is desirable.

The final outcome of this step could providethe basis for a recommendation to the Board ofManagement to progress with Step 5, implementa-tion of the preferred option.

5.1.5. Step 5: Implementation of preferredoption

The purpose of this step is to ensure the pre-ferred option is implemented in an appropriatemanner that meets regulatory requirements andbest practice standards. This involves:• Undertaking detailed design of the works;• Preparation of an Environment Improvement

Plan;

• Establishing recycled water supply agree-ments; and

• Acquiring EPA and other necessary approvals.

This Step is generally well understood by thewater industry and so the detail of this step hasnot been discussed. For example, GWMWater hasexperience in the detailed design and installationof 30 recycled water schemes. GWMWater hasalso developed a suite of supporting documents,including a standard agreement for the sale ofrecycled water and a generic environment im-provement plan that complies with the require-ments set out in EPA guidelines [3].

5.1.6. Step 6: Monitoring and review

Ongoing monitoring and review of existingrecycled water schemes is critical in ensuring the

192 S.S. Coutts / Desalination 188 (2006) 185–194

continuation of the best available option. Changesin the availability or cost of technology, therecycled water quality or quantity available, theneeds of the community, potential customers (eg.industry), environmental priorities and so on, maypresent new opportunities for improving recycledwater use and so provide reasons for reviewingschemes.

As part of the ongoing monitoring and review,auditing and reporting requirements must also beadhered to. A checklist of issues/topics relating tothe six-step recycled water framework forms partof the Recycled Water Strategy, to assist in theplanning and implementation of new recycledwater schemes and the benchmarking of existingschemes.

6. Pricing principles for recycled water

6.1. Pricing and cost sharing

Many questions and concerns from the com-munity relate to the cost of and price for recycledwater. These issues need to be acknowledged atthe outset and worked through with the preferredcustomer. Presented below are a number of prin-ciples and issues to be considered when pricingrecycled water.• Recycled water is not a standard product in

the market place. It combines the attributesboth of a utility commodity and of a waste by-product.

• Some aspects of its sale can be consideredwithin a standard pricing framework, whilstother aspects fit more sensibly within a wastedisposal context.

• Within the waste-disposal context, the waterauthority generally has obligations to disposeof the product.

• Market factors also need to be consideredwhere:– other competing products are commonly

subsidised and cost recovery normally doesnot meet either the full costs of supply orof negative externalities; and

– the wider TBL benefits are often unpricedand sale of the product is generally unableto realise a full commercial return, giventhe comparable pricing of alternative mar-ket competitors; and

– a purchaser of recycled water is faced witha number of issues to do with the product,relating customer acceptance and controlson usage, that do not arise with competingproducts.

Given this context, it would be unrealistic, inmost cases, to expect that recycled water will beable to command a premium price or recover allof the costs involved beyond the sewage treatmentworks to the final user.

6.2. Pricing tests

Recycled water services must comply with“Regulatory Principles”, which state they shouldnot reflect monopoly rents or inefficient expen-diture, provide incentives for sustainable use ofwater resources and provide the regulated entitywith incentives to promote the sustainable use ofwater resources.

Within this context there are a number of tests,which may form part of pricing negotiations.• Transparency: account for the costs incurred

and the revenue recovered in delivering therecycled water services as a standalone activity,separate from the delivery of sewerage ser-vices.

• Maximum price: the maximum price which thewater authority can charge will be set as theupper bound for cost recovery.

• Market forces: in practice, the price whichrecycled water can command will ultimatelybe determined by the marketplace, subject tointervention by a regulator or Government, toplace a dollar value on TBL outcomes.

• Competition: the maximum price which canbe realised will always be constrained by anupper limit set by the price of the nearest alter-native means of supply.

S.S. Coutts / Desalination 188 (2006) 185–194 193

• Discount for overheads: recycled water mayneed to provide a discount below the price forthe nearest competing source of supply to re-flect the increased overheads involved inhandling recycled water.

• Premium price: there may be situations whererecycled water can command a premium if ithas significantly greater security or locationalbenefits.

• Lower level: the effective market price maybe low if the commercial enterprise places alow value on the benefits that it will be able torealise from access to the resource.

• Tariff structures and risk: charges and revenuescan be expressed in a number of differentforms, which represent different time framesor approaches to risk sharing. These may in-clude annual charges, up-front capital contri-butions, longer-term contractual commitmentsor levies placed on the broader community.

• External funding: cost recovery may also beachieved through access to sources of externalfunding.

• Other: customers may share risks with thesupplier over such issues as the seasonal varia-tion in demand through, for example, theconstruction of storages on the customer’s siteto provide for a rate of flow that better meetsdemand requirements.

7. Conclusion — key outcomes of the RecycledWater Strategy

The improved awareness and understandingof GWMWater staff and management, key stake-holders and the general community of the valueof recycled water has been paramount to thesuccessful development and implementation of theRecycled Water Strategy.

Engaging community and stakeholders in thedevelopment of recycled water initiatives, pro-motes sustainability principles and an improvedunderstanding by the community of viabilityissues and management requirements.

Through the recycled water framework,guidelines and criteria have been developed tomeasure and evaluate the efficiency, effectivenessand sustainability of initiatives involving the useof recycled water, ensuring the achievement ofGovernment objectives [7].

The identification of potential markets forrecycled water are considered in light of an integ-rated water resources planning approach, pro-viding the opportunity to demonstrate the eco-nomic value of recycled water relative to othersources of water. In a number of cases, this hasnecessitated the “unbundling” of the commercialelements of existing land use and recycled waterentitlements that are currently in place underagreements with existing users.

The measures that have been developed arerelatively generic and capable of being transposedto other regional areas where management obliga-tions and responsibilities encompass sustainabilityprinciples.

Through better planning mechanisms, a tho-rough understanding of water markets, the iden-tification of new opportunities and potential re-cycled water markets, GWMWater can identifythe preferred recycled water use option that bestsatisfies sustainability and community require-ments. More importantly, a strong planning frame-work, combined with commitment from partnerentities within the community and region, canprovide GWMWater with an excellent businesscase to seek external funding for future recycledwater initiatives.

Acknowledgements

The author wishes to acknowledge the workof RM Consulting Group in the development ofthe Recycled Water Strategy, the Department ofSustainability and Environment, Water SectorDevelopment, for participating in the developmentof GWMWater’s Recycled Water Strategy and thefunding support provided by Wimmera Water forGrowth.

194 S.S. Coutts / Desalination 188 (2006) 185–194

References[1] Department of Sustainability and Environment,

Securing Our Water Future Together, Departmentof Sustainability and Environment, Victoria, 2004.

[2] RM Consulting Group, Urban Wastewater ReuseStrategy for the Wimmera Region, Victoria, 2003.

[3] Environment Protection Authority Victoria, Guide-lines for Environmental Management — Use ofReclaimed Water, Environment Protection AuthorityVictoria, Victoria. Publication No. 464.2, 2003.

[4]] RM Consulting Group, Development of an UrbanWastewater Reuse Strategy for the Wimmera Region

—Grampians Water ‘Issues Paper’, Victoria, 2003.[5] Department of Sustainability and Environment, New

Water for Victoria — Victoria’s Water RecyclingAction Plan, Department of Sustainability andEnvironment, Victoria, 2002.

[6] Department of Sustainability and Environment,Draft Guidelines for Planning and Reporting Re-cycled Water Programs, Department of Sustain-ability and Environment, Victoria, 2003.

[7] Department of Sustainability and Environment,Securing Our Water Future Green Paper for Dis-cussion, Department of Sustainability and Enviro-nment, Victoria, 2003.