The economic impact of reducing greenhouse gas emissions in wastewater treatment plants: An inverse optimization approach

The wastewater treatment sector is transitioning towards low-carbon operations. Understanding the economic implications of reducing greenhouse gas (GHG) emissions in wastewater treatment plants (WWTPs) is essential for effectively planning their decarbonization. This study introduces a novel methodology, utilizing inverse data envelopment analysis, to estimate the costs of reducing GHG emissions in WWTPs while maintaining their eco-efficiency. An empirical study was conducted on 260 WWTPs, evaluating five GHG reduction scenarios ranging from 5% to 50%. The results indicated that some WWTPs face a trade-off, unable to reduce GHG emissions without compromising the quality of treated wastewater. For each scenario considered, economic impacts varied significantly across WWTPs. Average operational costs are projected to rise from the current 0.68 €/m 3 to 1.9 €/m 3 for a 5% GHG reduction, and to 3.03 €/m 3 for a 50% GHG reduction. Carbon costs per WWTP and scenario also showed considerable variability, with average values ranging from 97 €/KgCO 2 e to 227 €/KgCO 2 e. Highlighting the necessity for ex-ante economic assessments of environmental policies, this study underscores the variable cost increases in WWTPs associated with GHG emission reductions and therefore, the need of tailored environmental policies. • The cost of reducing greenhouse gas estimations in wastewater treatment was estimated • Operational costs will increase between 1.9 to 3.0 €/m 3 for 5% and 50% reductions. • The cost of carbon emissions was estimated between 97 and 227 €/KgCO 2 e