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Sustainability mandatory reporting has financial impact

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Sustainability mandatory reporting has financial impact

Welcome to GWI news, a collaboration from the Urbanista podcast and Global Water Intelligence UK. In this episode our hosts Delfin Vassalo and Tallulah Lutkin, Utility Performance Editor at GWI, take a look at some of the bigger recent stories from the world of the water industry. We discuss some conclusions from COP 28 in Dubai, developments in Direct Potable Reuse, the EU’s new corporate sustainability reporting directive, Germany’s sludge management and the Swedish case which asks, ‘who is responsible for PFAS?’

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COP 28

The year ended with the somewhat contentious COP 28 UN Climate Change Conference in Dubai. There was hope that water would continue to establish itself as a key topic in the environmental debate. Although there were clear achievements in this area, such as the adoption of water as a sectoral target in the Global Goal on Adaptation, there was, however, a general feeling that the focus was less on utilities and more on water and food. More than $7.1 billion worth of commitments were made to support sustainable agriculture and resilient food systems. The lack of participation by water utilities continues a worrying trend which also saw them barely feature at the Stockholm Water Week or the UN Water Conference. On the other hand, we should remember that just three years ago, there was no Water Pavilion or Water Day at the COP. Progress is happening, but more is needed.

Direct Potable Reuse

California has become the second US state to approve standards for direct potable reuse (DPR). The somewhat controversial process is sometimes dubbed the ‘toilet to tap’ process where wastewater is treated to a level suitable for drinking, re-depositing it directly back into a drinking water distribution system. The new standards do not make this process legal, but it does set clear standards which are needed to clarify and unlock the market to investment. Despite this decision, there remain many hurdles since the process is extremely expensive. Although not currently a possibility in Europe, there has been some movement regarding regulating indirect potable reuse via aquifer, but DPR is still a long way off.  

New corporate sustainability reporting directive

Thousands of companies will have to begin assessing their water impact under new EU standards that come into force this month. The new sustainable reporting standards are an attempt to bring practical action to improved water management, but there are concerns that this could also burden already stretched services.
The new obligatory standard is one of the most ambitious sustainability reporting requirements in the world. Starting with large companies of over 500 employees (including large utilities), the standards require consideration of the value chain, i.e., who you are buying from, and report not only on the water impact but also the impact on the financial business. This step aims to quantify the risks and opportunities to businesses’ financials and make companies stop and think about their water use. Although the new standard currently applies only to larger companies, any smaller company part of a larger company’s value chain may also have to start collecting relevant impact data.

Germany’s management regulations

Germany is struggling to keep up with its commitment to manage its wastewater sludge. Since 2015, regulations have pushed to reduce sludge being used for land spreading and instead take it to be incinerated. Additionally, phosphorus should be recovered from the sludge. This two-step requirement would prevent the environmental problems caused by land spreading, and also provide a valuable source of phosphorus which would otherwise need to be imported.
However, it is clear that the German utilities are not on track to meet the target deadline. Although the reduction in land spreading and incineration is going well, the phosphorus recovery technology is still little tried and tested so there is a reluctance from utilities to invest heavily in it, something that would probably cause an increase in tariffs.

Water utilities in Sweden

There have been a series of lawsuits regarding responsibility for PFAS contamination. Beginning with a community in Sweden that has successfully sued a water utility for PFAS in the water supply; we have also seen a water utility in the US that has sued the army for contamination with PFAS containing chemicals used during firefighting. Additionally, a town in Wisconsin in the US has sued PFAS manufacturer 3M for creating the chemical for its products.
This series of lawsuits all ask the question, where lies the responsibility for PFAS contamination? While the Swedish court has found against the utilities, some might argue that the real responsibility, to say nothing of the financial power to settle these lawsuits, lies with the PFAS manufacturing companies.

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