Guest Column | October 30, 2025

Public-Private Water Partnerships: Proactive Strategies For Industrial Water Challenges

By Taylor Nelson, PE, and John Rydzewski, PE

1125-Carollo

One of the most pressing challenges facing utilities today is how to effectively respond to surging industrial demands while managing costs and maintaining established levels of service to existing customers. Thanks to new funding sources and drivers such as AI, the landscape has changed dramatically in recent years. Industries such as data centers and semiconductors are consuming massive volumes of water to support cooling and manufacturing — and creating equally daunting challenges on the wastewater front.

These industries select sites based on many factors, but water resources, treatment, and infrastructure requirements may take a back seat to other political or commercial drivers. As a result, utilities are expected to accommodate significant new water and wastewater challenges without meaningful consultation during the initial development stages.

Industrial growth brings economic benefits but also places unprecedented demands on existing infrastructure. Utilities that quantify and communicate their constraints early can transition from reactive responders to strategic development partners.

Strategic Engagement In Economic Development

Economic development agreements negotiated without utility input reduce the opportunity for optimized, sustainable, and scalable solutions. Proactive engagement and transparent utility-industry communication can identify and address water infrastructure needs before commitments are finalized.

  • Stakeholder Inclusion. Utilities must establish consensus with economic development authorities on water resource, treatment, and infrastructure requirements before incentives are offered.
  • Communication Transparency. Industrial clients may provide limited information on water and wastewater demands — often because it isn’t available or quantified. In addition, water and wastewater flows and loads will most likely change over the course of the project. Successful implementation requires open and honest communication with expert partners who know how to assess industry requirements.
  • Timeline Transparency. For industrial projects, time is money, and projects frequently progress much faster than a typical municipal project. Understanding project needs helps set realistic expectations and drives innovative project delivery approaches.

Bridging Timeline Disparities

Industrial timelines rarely align with traditional utility planning cycles. Innovative project execution can help bridge the gap.

  • Strategic Project Segmentation. Phased solutions that align with industrial client funding can support early implementation. In addition, temporary solutions can support challenging schedules without stressing municipal services.
  • Collaborative Delivery. Design-build and turnkey models that integrate operations and financing offer creative approaches to accelerate implementation schedules and provide holistic solutions.
  • Partnered Permitting Approach. An intentional and proactive permitting approach can help educate authorities who have jurisdiction and support accelerated approval timelines without sacrificing review requirements or quality.
When utilities proactively develop regional frameworks before they’re faced with major industrial demands, they dramatically strengthen their ability to publicly support economic development while protecting existing customers.

Balancing Multiple Stakeholder Priorities

Successful integration balances new industrial water demands and wastewater loads with existing residential and commercial customer needs.

  • Multi-Quality Water Production. Progressive utilities are implementing water/wastewater treatment standards tailored to specific end uses to optimize capital and O&M costs, as well as water resources.
  • Circular Water Incentives. Rate structures that reward industrial customers who implement closed-loop or cascading water reuse systems can significantly reduce net water demand.

These approaches allow utilities to maintain service equity without requiring massive immediate capacity expansions or rate hikes.

Three Success Strategies

1. Early Engagement. Engage utilities in discussions with municipalities, owners, and economic development teams before decisions are made. Early involvement minimizes unrealistic commitments and allows for proper infrastructure planning.

2. Transparent Communication. Facilitate a direct dialogue between industrial users and utilities about constraints, requirements, and timelines from the outset. Transparent communication prevents misaligned expectations and builds trust between parties.

3. Regional Collaborative Solutions. Consider comprehensive regional frameworks that distribute costs and resources across multiple stakeholders and create ancillary benefits and value, such as waste heat recovery and water reuse. Collaborative delivery approaches help meet aggressive timelines and promote investment by all parties.

Regional Collaborative Frameworks

The water and wastewater challenges associated with industrial demands are too complex and expensive to be addressed through traditional siloed approaches. Implementing regional solutions can significantly enhance success.

  • Multi-Utility Coordination. Regular planning meetings with neighboring utilities — specifically focused on industrial development impacts — can help identify shared opportunities and challenges.
  • Public-Private Solutions. Providing treatment and infrastructure that can meet the needs of multiple industrial clients, as well as local utilities, can reduce the overall capital and O&M costs of solutions and support continued collaboration.

Maximizing Resource Value

Forward-thinking water professionals can maximize water resources through innovative approaches.

  • Integrated Resource Recovery. Industrial service agreements that require beneficial water reuse and discharge heat capture can create value from existing waste streams.
  • Watershed-Scale Exchanges. Requiring the industrial user to provide equivalent water quality improvements in the watershed can help maintain positive environmental outcomes.

About The Authors

Taylor Nelson, PE, is the mission-critical market sector lead and a senior process engineer at Carollo Engineers, with specialized expertise in industrial wastewater treatment design. She has recently served as assistant design manager and senior/lead engineer on multiple design-build projects in the semiconductor and mission-critical/data center sectors. Her technical strengths include biological treatment design, hydraulic modeling, and construction oversight of treatment facilities. In addition, she brings valuable experience conducting site-specific due diligence studies and developing tailored solutions for clients across the food and beverage, industrial, and high-tech industries.

John Rydzewski, PE, is the private sector group sustainability lead and a vice president at Carollo Engineers. With over 30 years of experience in design, construction, and operations — primarily in the semiconductor industry — Rydzewski has been involved in fab greenfield projects across the U.S., Ireland, Israel, and China. He played a key role in designing and constructing ultrapure water, wastewater treatment, and recycling systems, and has extensive experience negotiating win-win solutions between fab owners and municipalities.