Chennai, a city on the Southern coast of India and the state capital of Tamil Nadu, has one of the world’s fastest-growing economies. Chennai is the automotive hub of India and is also home to several other industries ranging from petrochemical, hardware manufacturing, textile and apparel. Besides industries, Chennai’s economic activities include medical tourism, software, and financial services. Recent estimates of the economy of the Chennai Metropolitan Area have ranged from US$79 to US$86 billion (PPP GDP), ranking it from fourth to sixth most productive metro area of India. Due to urbanization and economic growth, Chennai’s population has increased more than 50% in the last two decades, becoming the fourth largest city in India with over 10 million people and extending over 426 km2 .

The rapid growth of the city has created several water challenges:

- Water supply has not been able to keep up with demand. Chennai has historically relied on ground water that provide between 100 – 120 MLD of water and four rainfed lakes (with a combined storage capacity of about 11,000 million cubic feet (mcft)) that have the potential to provide between 632 and 854 MLD of water depending on the monsoon season to meet the water needs of the city. However, the demand for water in the city has increased more than 50% in the last decade up to 1,200 MLD due to industrial development, increasing population and due to larger per capita needs triggered by economic growth. Per capita availability of water dropping from 1,816 cubic meters (CM) in 2001 to 1,545 CM per year today. There is an existing gap between the water demand and the combined water supply from all sources. Households are then forced to supplement this gap with their own bore wells and/or tanker water supply to meet their water needs.

- Extreme weather events further aggravate the issue. Since the city is entirely dependent on rains for recharging its water resources, monsoon failures lead to acute water scarcity and droughts. The city usually gets 1200 mm of rain between mid-October and mid-December that help replenish surface and groundwater sources. However, Chennai city is regularly, over cycles measured in years, afflicted by severe floods and droughts. In the last two decades, the city has seen floods in 2005, 2010 and 2015, book-ended by droughts in 2003-04 and 2016-2018.

- The unplanned expansion of the city at the expense of water has led to the contraction of water bodies in and around the city from 12.6 km2 in 1893 to 3.2 km2 in 2017. These water bodies were important in providing Chennai with water during drought periods and to be a buffer during heavy rains.

- Growing population and failing monsoons have necessitated bringing water from distant sources and from desalination plants, increasing the cost of water supply. 

The Chennai Metropolitan Water Supply and Sewerage Board (CMWSSB) took a holistic approach to address the water challenges. They initiated several projects to ensure a reliable and resilient water supply for the city. Wastewater reuse emerged as a viable solution to augment water availability and cater to the industrial sector's needs. CMWSSB established different agreements with industries, making treated wastewater available for non-potable industrial use. Industries, including petrochemical companies, benefited from this initiative by purchasing treated sewage for their operations, reducing their reliance on freshwater sources. The reuse of treated sewage freed up freshwater supply, enabling it to meet domestic water needs.

In addition to wastewater reuse, CMWSSB implemented energy recovery systems in several sewage treatment plants. By anaerobically digesting sewage sludge and generating biogas to produce electricity, they reduced their dependency on grid power and improved financial sustainability.

The implementation of various projects yielded positive outcomes for Chennai's water management. Wastewater reuse for industrial purposes provided a reliable water source for industries, ensuring their operations continued smoothly even during water scarcity periods. This reduced water scarcity risks and resulted in substantial cost savings for the industrial sector.

Moreover, the revenue generated from selling treated sewage to industries significantly improved CMWSSB's financial sustainability. The revenue from wastewater reuse helped cover the operation and maintenance costs of the treatment systems, further contributing to their efficiency.

Energy recovery from sewage sludge reduced grid dependence and lowered operational costs for sewage treatment plants. The use of biogas for electricity generation also resulted in a considerable reduction in greenhouse gas emissions, making the wastewater treatment operations more environmentally friendly.

Additionally, CMWSSB's plans for indirect potable reuse further strengthened water resilience by augmenting water supply and diversifying water sources.

Overall, CMWSSB's innovative and sustainable initiatives significantly improved water management in Chennai. Their efforts not only addressed water challenges but also contributed to building a more resilient and sustainable water supply system for the city's continued growth and development.

Lessons Learned

Government support and regulations that foster wastewater reuse are crucial for the success of the project: The fact that there were national, parastatal and local regulations and policies that incentivized or mandated wastewater reuse was a trigger for this type of projects to flourish and succeed in Chennai. The higher water tariffs for industries and the zero-discharge policy forced industries to explore other options and consider alternative sources such as treated wastewater.

Water Scarcity Encourages Water Reuse. Besides adequate government support and regulations, this case study shows that water scarcity also triggers the exploration of more innovative solutions that consider non-conventional water sources. It also shows that wastewater reuse is economically viable in water-scarce areas, especially where the cost of tapping the nearest water source is high.

Proactive planning and innovative thinking are important to build urban water resilience. Rapid urbanization, increased populations and fast economic development will stress water scarcity. Cities should adopt proactive planning mechanisms to project economic growth, urbanization patterns and water demand. Non-conventional water resources will play more and more important roles in building urban water resilience and should be incorporated in the planning.

Competitive treated wastewater tariffs:  Besides reliable and constant water quality, a competitive tariff is needed to ensure that industrial consumers consider the use of reclaimed wastewater instead of freshwater.

The right contract design can incentivize energy recovery in treatment plants: Including provisions in the operations and maintenance contracts that penalize the operator by charging them twice the amount whenever power is drawn from the grid to operate the sewage treatment plants (where energy recovery systems are available) incentives operators to maximize efficiency of energy recovery systems and reduce energy withdrawal from the grid.

Piloting a small-scale project first with one or two end users can serve as a proof of concept. The success of the first pilot led by the industrial user (CPCL) fostered the implementation of more wastewater reuse projects.

The full case study can be dowloaded in here

This case study is part of a series prepared by the World Bank’s Water Global Practice to highlight existing circular experiences in the water sector. For more information on the Water In Circular Economy and Resilience (WICER) initiative go to: https://www.worldbank.org/en/topic/water/publication/wicer