The viability of ‘mining’ high-value resources from wastewater is opening new opportunities for the sector. Kala Vairavamoorthy explores the emerging shift from treatment to transformation.
For more than a century, our sector’s purpose around dealing with wastewater has been clear: protect health and the environment by treating and discharging safely. That mission remains vital – but it also limits our imagination.
What if wastewater is not primarily something to be neutralised, but is a resource to be mined? Framed this way, treatment becomes the by-product, and the real goal is recovery – of water, energy, carbon and critical materials.
And once that frame shifts, everything else shifts with it:
- What we build – the treatment trains and technologies we choose
- How we fund – the business models and partnerships we design
- What success looks like – no longer measured by compliance alone, but by its contribution to resilience, resource security, and climate action.
Framed like this, wastewater is no longer about end-of-pipe infrastructure. It becomes the very starting point of a new industrial ecosystem – platforms for production, the factories and mines of the circular economy.
My sense of this opportunity is my big takeaway from having had the privilege of attending IWA’s Resource Recovery Cluster Conference in May. Organised by Wetsus in collaboration with Delft University of Technology and Wageningen University & Research in Leeuwarden, Netherlands, the event was brimming with ideas, examples and debate. It set out new thinking and shared latest experiences spanning the resource recovery landscape. And, for me, it revealed a powerful theme that could reshape the way we think about wastewater: a shift from bulk, low-value outputs like biogas and biosolids to targeted, high-value resources.
Learning from early resource recovery
The sector’s first steps into resource recovery were logical ones. Given the vast and dilute nature of municipal wastewater, it made sense to pursue early recovery pathways that produced bulk resources such as biogas and biosolids, alongside targeted products like struvite. These approaches have delivered real benefits: biogas remains central to many utilities’ energy neutrality strategies, and struvite recovery has reduced maintenance issues by preventing scaling and improving sludge handling.
Yet while these pathways have been important, they also reveal their limits. Margins are often razor-thin, revenues exposed to volatile energy and fertiliser markets, and adoption justified more by operational convenience than by market demand. In practice, they have delivered real operational value but only modest economic returns.
In fact, market prices for struvite have fallen well below early 2010 levels and now typically barely offset the cost of reagents, labour and freight. Similarly, while biogas remains central to energy neutrality goals, its financial viability is eroding. In grids with high renewable penetration, periods of zero or even negative electricity prices are becoming common – undermining the value of exported biogas-derived power.
Take-up of other opportunities based on similar thinking has been somewhat limited. For example, capture of biogenic carbon dioxide from biogas upgrading is in place at fewer than 30 sites globally; effluent heat – a stable, low-grade thermal resource – at only a few hundred locations; production of ammonium sulphate in fewer than five utilities; and cellulose and fibres from screenings, a recoverable feedstock for paper or construction materials, remain largely unexploited.
Advancing treatment technology options
This is why so much attention at the Resource Recovery Conference focused on new technological pathways that might overcome these constraints.
We see advanced thermal and chemical processes transforming waste into strategic materials. The Ash2Phos plant in Schkopau, Germany, for example, processes 30,000 tonnes of sewage sludge ash annually to produce high-purity phosphorus – a material now recognised in the EU Critical Raw Materials Act – while also recovering valuable co-products such as ferric chloride and construction-grade sand.
Other pathways are also maturing, through deployment of electrochemical processes, advanced separation, and biologically tuned production platforms. Vivianite, a naturally forming iron-phosphate mineral, can now be selectively recovered via magnetic separation for use as a pigment or phosphate source. Lithium and magnesium are being extracted from desalination brine at battery-grade purity. Short chain fatty acids (SCFAs) such as acetate and propionate are emerging as high-value intermediates for chemicals and animal feed, commanding up to 10 times the value per unit of Chemical Oxygen Demand (COD) compared to methane. Also, new bio-based materials like Kaumera are beginning to prove their worth.
Traditional processes – anaerobic digestion for biogas, struvite precipitation for phosphorus – remain valuable. But the horizon is expanding, and the recovery community is increasingly exploring a broader portfolio of products, where different treatment trains may be optimised for different outputs.
Business models and ecosystems – beyond technology
These process options are just part of the story. One of the striking shifts at this year’s Resource Recovery Conference was that the conversation moved beyond the technical ‘how’ of resource recovery and into the economic ‘why’ and ‘for whom’. If recovery is to move from laboratory to market, it cannot be justified only by process diagrams or pilot results. It must be supported by viable business models.
This line of thinking draws on tools such as the business model canvas: Who are the customers for recovered products? What value proposition do they offer compared with substitutes already on the market? Through which channels will they be delivered? And perhaps most critically, does the cost structure and potential revenue make sense for the utility or its partners?
Another clear takeaway from the conference (echoed by Bernhard Truffer in his contribution to the IWA Resource Recovery Conference special magazine issue) is that resource recovery is not the sole responsibility of utilities but the work of an entire ecosystem. Progress depends on networks of actors – utilities, technology providers, regulators, financiers and off-takers – aligning their roles to make new products viable. For such networks to succeed, dedicated businesses are needed that can master the technology, understand the market and operate profitably, all without undermining the public service mandate of the utility. Within this model, utilities are not the finished-goods producers but the suppliers of feedstock, enabling others to refine, distribute, and sell. This is not a replacement of the traditional utility model, but an expansion of it – one that requires careful coordination to balance the public mission with market-orientated ambition, and in doing so, unlocks a more dynamic and resilient future for the sector.
The low volume, high value opportunity
Among the emerging technology and product options there are some that stand out as being what we can call low volume, high value opportunities. Battery-grade lithium is one example. SCFAs are another.
The emergence of these options adds weight to the potential for a profound change – one that is not technological, but philosophical. With the historic treatment objective of protecting health and the environment, resource recovery was a useful by-product. The future may invert this logic: recovery becomes the organising principle, and safe water discharge the inevitable co-benefit.
Yet there is a tension here that organisational theorists call conflicting institutional logics – a concept also highlighted by Bernhard Truffer. On the one hand, utilities are anchored in their public service mandate: protect health, safeguard the environment and deliver reliable services at cost. On the other, they are now being asked to think and act like market players, developing new products, cultivating buyers and chasing value streams.
These two logics do not sit comfortably together. Should resource recovery remain an afterthought – a useful by-product of treatment – or should it become the central organising principle, with wastewater treatment reframed as the necessary co-benefit of production? It is not obvious that a stable middle ground exists. So, as we look ahead to the resource recovery opportunities, the sector may need to wrestle with a deeper question: what is the primary purpose of a wastewater utility in a resource-scarce, climate-pressured world?
The role of IWA – driving innovation
This is where networks like IWA come in. Utilities carry immense responsibilities: delivering safe drinking water, protecting public health and ensuring reliable wastewater treatment. With such vital mandates, they understandably have little capacity to experiment with new business models or explore how resource recovery could work in practice. Instead, they depend on wider networks to create the space where innovation can emerge.
That is exactly the role IWA has played – and will continue to play. Through our Specialist Groups, conferences and Resource Recovery cluster, we provide the platforms where utilities can engage with researchers, technology providers, and market actors to explore opportunities and test ideas. In this way, IWA helps move the resource recovery narrative forward: not by prescribing solutions, but by curating the evidence, conversations and partnerships that allow the most promising pathways to take root and flourish.
Design choices shaped by purpose
The shift towards low volume, high value options is not an abstract debate; it has very tangible implications for how we design our systems. The treatment trains we select, the scale and location of plants, and even the partnerships we prioritise, will increasingly be determined by what it is we seek to extract. Do we build around neutralisation, where safe discharge is the primary goal, or do we build around extraction, where recovery defines the flow sheet and treatment is the necessary by-product?
This type of thinking is not entirely new. The discipline of industrial ecology has for decades examined how resource flows can be mapped, optimised and aligned to create value. What is striking is that only now is the water sector beginning to embrace similar questions: if wastewater is a feedstock, what is the most effective way to mine it? Which products justify the investment? And how do those choices cascade down into infrastructure decisions that may lock us into one pathway for decades?
Such reflections underscore why the sector cannot treat resource recovery as a marginal add-on. It compels us to ask: what kind of system are we designing, and for what purpose?
It is evident too that resource recovery cannot be reduced to a single pathway. Every recovered resource has its own technical requirements, cost dynamics and market realities. Recovery, therefore, is not one alternative trajectory but a constellation of possible pathways, each demanding different partners, skills and support. Utilities cannot chase all of them. They must decide selectively, choosing which resources to target, which markets to engage, and which innovation systems to align with.
So, not every utility should try to recover everything. Success may depend on choosing a lane – identifying which resources make sense in a given context, based on local demand, partnership opportunities, and institutional capacity. This is not a retreat from ambition, but a shift toward strategic focus.
A new paradigm emerging
If we step back, what is emerging is more than an incremental change in treatment – it is a reframing right across our water systems. From disposal to production. From sunk costs to value generation. From rigid infrastructure to adaptive platforms.
The opportunities are real, but so are the challenges. Financial viability, enabling policy and public trust will be decisive. And we must avoid naїve techno-optimism: not every product will scale, not every system will pay for itself, and not every context will favour resource recovery. But even recognising these caveats, the trajectory is clear.
This shift is no longer just about sustainability – it is equally about resource security, circular supply chains, and resilience in a volatile world. As policies like the EU Critical Raw Materials Act recognise wastewater as a source of strategic materials, the case for transformation is not simply environmental; it is also economic and geopolitical.
We are entering a period where water professionals must think beyond compliance and ask: What if wastewater was the starting point for the materials and energy systems of tomorrow? What would that mean for how we design, finance and govern our infrastructure today?
That is the frontier now opening before us. And it is one that calls for boldness, pragmatism and imagination in equal measure. For IWA members, the challenge is clear: we must lead in moving this agenda forward – not only by developing technologies, but by rethinking business models, forging partnerships and strengthening the ecosystems in which recovery can thrive. The choices we make today will determine whether wastewater remains an end-of-pipe obligation or becomes the starting point of tomorrow’s resource-secure, circular economy.
More information
The conference special magazine edition is available at: https://resourcesinwater.com
The author: Kala Vairavamoorthy is the CEO of the International Water Association
