Valuing Decentralized Wastewater Technologies

The report analyzes the economic trade-offs between decentralized and centralized wastewater systems, arguing that while treatment plants exhibit economies of scale, collection networks often exhibit diseconomies of scale. It highlights the financial advantages of modular, 'just-in-time' capacity expansion and the potential for water reuse and nutrient harvesting. The document also details various economic valuation methods for non-market environmental goods and the importance of professional management to ensure system reliability.

• Decentralized systems allow for a 'just-in-time' capacity expansion, which reduces the net present value of costs by moving expenditures to the future and avoiding the financial risk of overbuilt capacity if growth is lower than predicted.
• While wastewater treatment facilities generally benefit from economies of scale (unit costs decrease as capacity increases), wastewater collection systems often experience diseconomies of scale, where unit costs increase as the system size and service area expand.
• Centralized sewer systems can negatively impact watershed hydrology by reducing groundwater recharge and stream base flow through infiltration and inflow (I/I) and the transport of water out of the local basin.
• Decentralized systems can support 'smart growth' and cluster development, which helps preserve open space and reduce impervious surfaces, whereas centralized sewers may encourage urban sprawl by making distant land developable.
• Decentralized systems offer opportunities for cost-effective water reuse at the site or neighborhood scale, avoiding the expensive dual-distribution networks required for centralized reuse.
• The risk and cost of system failure is generally lower for decentralized systems because failures are small and widely distributed, whereas centralized system failures can be severe and concentrated.
• Decentralized systems can be more resilient to natural hazards and sabotage due to their dispersed nature, although they may be more vulnerable to individual user misuse or inadvertent human interference.
• Effective management of decentralized systems, such as through a Responsible Management Entity (RME), can protect property values and prevent the high costs of premature system replacement.
• Decentralized systems can support local economies more effectively than centralized systems by keeping more spending on labor and materials within the community rather than paying interest to distant lenders or power companies.
• The report identifies several economic valuation techniques for non-market goods, including the travel cost method, hedonic pricing, contingent valuation, and the defensive expenditures method.

APA

Pinkham, R. D., Hurley, E., Watkins, K., Lovins, A. B., Magliaro, J., Etnier, C., & Nelson, V. (2004). Valuing Decentralized Wastewater Technologies. RMI. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_W04-21_ValuWstWtr.pdf

Chicago

Pinkham, Richard D., Eric Hurley, Kate Watkins, Amory B. Lovins, Jeremy Magliaro, Carl Etnier, and Valerie Nelson. Valuing Decentralized Wastewater Technologies. RMI, 2004. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_W04-21_ValuWstWtr.pdf.

Wikipedia

{{cite report |last1=Pinkham |first1=Richard D. |last2=Hurley |first2=Eric |last3=Watkins |first3=Kate |last4=Lovins |first4=Amory B. |last5=Magliaro |first5=Jeremy |last6=Etnier |first6=Carl |last7=Nelson |first7=Valerie |title=Valuing Decentralized Wastewater Technologies |publisher=RMI |date=November 2004 |url=https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_W04-21_ValuWstWtr.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{pinkham2004valuing, author = {Pinkham, Richard D. and Hurley, Eric and Watkins, Kate and Lovins, Amory B. and Magliaro, Jeremy and Etnier, Carl and Nelson, Valerie}, title = {{Valuing Decentralized Wastewater Technologies}}, institution = {RMI}, year = {2004}, month = nov, url = {https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_W04-21_ValuWstWtr.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }