By Henry J. Charrabé
What the recent water- and wastewater-related disasters in the U.S. should teach us
Several recent events should make the lack of appropriate and efficient water and wastewater treatment in the U.S. front and center in our infrastructure discussions. The water distribution crisis of Flint in 2014, the cyberattack on the water supply in Florida in February, and the freezing temperatures that recently decimated Texas’ water infrastructure have made it clear that the time for modernization is now.
Over the past century, the U.S. has relied on the same water and wastewater treatment approach — similar technology, the same players (albeit different brand names from mergers and divestitures), and the same network of consultants and engineers. It’s no surprise that applying the same methodology for decades has not resulted in any significant innovation. The fact that we still use drinking water to flush our toilets or that tenants have water “included” in monthly rent with no regard to usage or price leads us to a lack of conscientiousness about the most essential resource in the world.
Building large-scale water and wastewater treatment plants, then distributing water through a vast network of pipes and underground labyrinths is not only inefficient but also incredibly energy-intensive. Additionally, as witnessed in the aforementioned water-related crises, it exposes a single water supply to vulnerability and does not allow for multiple, smaller-scale sources of supply for increased safety and security. The financing of these large infrastructure projects narrows the field of qualified bidders, given the requirements for recent references and operation of such plants. This limits the potential for a truly competitive procurement process, stifles innovation, and does not incentivize entrenched players to think of new approaches.
One of the biggest misconceptions is that we need to wait for some breakthrough technology to solve our water- and wastewater-related issues. This is false. With today’s existing and available technologies from multiple providers, we can treat any body of water, anywhere. The challenge is the price.
The solution to our water and wastewater infrastructure backlog in the U.S. (to the tune of $1.8 trillion) should be a focus on building several decentralized water and wastewater systems and encouraging wastewater reuse. At the very least, we must reuse wastewater for irrigation, air conditioning, and toilet flushing. Decentralized systems vastly shorten the time needed from order to delivery and reduce the need for expansive infrastructure — thereby reducing the investment dollars needed per end user. These are proven systems, already adopted in many other countries around the world, and if bundled, both for municipal and industrial use, will be easily financeable.
Further, rather than spending billions in government funds to build water and wastewater infrastructure, we should encourage the private sector, such as commercial lenders and eager infrastructure and project finance funds, to help commission these smaller and decentralized plants for municipalities through project finance arrangements. This eliminates the need for large capital investment up front, allows for lower payment over the term of the contract, and the municipality can charge its ratepayers the appropriate monthly rate. Finally, rather than issuing grants and spending federal or state funds, authorities at the federal, state, and local levels should merely act as guarantors to these longer-term, smaller infrastructure projects. Creditworthy municipal guarantees will keep financing costs low, allowing ratepayers to pay less per gallon of fresh, reliable reused or treated wastewater. Also, municipalities would maintain total pricing authority (whether subsidized or not) as long as the monthly payments to the operators and financiers of the plants are made.
This is not a political or partisan issue; this is an American issue. If we don't act swiftly and firmly, these water- and wastewater-related problems will only drastically increase as weather patterns change and population density increases. There are plenty of viable and proven solutions — but we must have the willingness to break from the old ways and build back better through modernization and innovation.
Henry J. Charrabé is a Member of the Board of Directors of Waterise, the former Managing Director & CEO of global water and wastewater treatment firm Fluence Corporation, and holds a Master’s in Public Administration from the Harvard Kennedy School of Government.