The intent of this paper is to outline benefits, hazards for implementation and management, and a range of governance framework approaches for catchment nutrient offsets based on existing market mechanism experiences across Australia and internationally.
Protecting water quality is at the heart of water utilities' operations, from ensuring clean drinking water supplies to managing treated effluent in large-scale recycling schemes. Across urban Australia and New Zealand, effective tertiary sewage treatment systems remove considerable amounts of solids, nutrients, and pathogens from effluent before it re-enters waterways. However, as licensed point source pollution activities, water utilities often face higher regulatory and community expectations compared to diffuse source pollution from stormwater or agricultural runoff, which typically have a more significant overall impact.
Utility customers bear the brunt of infrastructure construction and operation costs for pollution minimisation. As effluent standards reach a point of diminishing returns, it may be more effective to focus on restoring degraded riparian areas and improving stormwater treatment. To achieve comprehensive wastewater management, we need to consider all available options, including nutrient offsets as a market-based instrument for a holistic catchment pollution management approach across point and diffuse sources.
Water utilities are already circular economy enterprises, incorporating water, biosolids, and energy. Catchment-scale nutrients can serve as another tool in their arsenal, promoting flourishing and resilient regions.
Although examples and case studies of nutrient offsets achieving superior sustainability outcomes compared to a singular focus on sewage treatment existed, there was no consolidated reference point outlining the benefits, hazards, and key ingredients for a successful framework.
To fill this gap, this project was established with peer utility involvement via the WSAA Liveable Communities Committee and Climate Change Energy and Environment Network, aiming to create a go-to resource for water utilities, regulators, policy makers, and other stakeholders. WSAA engaged independent experts Professor Michele Burford and Dr. Jing Lu at Griffith University to consult broadly and compile this report.