OUR MISSION: To provide our customers with high-quality, efficient and reliable water, power and sewer services in a manner that values environmental and community interests and sustains the resources entrusted to our care.
525 Golden Gate Avenue
San Francisco, CA 94102
T 415.554.3289
DISTRICT-SCALE WATER REUSE MEMORANDUM
Executive Summary
In accordance with Ordinance 155-21 that amends Article 12C of the San Francisco Health Code (also known as the Non-potable Water Ordinance), the San Francisco Public Utilities Commission (SFPUC) drafted the following report evaluating the challenges of, and opportunities for requiring the construction, operation, and maintenance of district-scale non-potable water systems.
The Non-potable Water Ordinance allows for the collection, treatment, and use of alternate water sources such as graywater, rainwater, stormwater, blackwater, and foundation drainage for non-potable applications in buildings such as toilet flushing and irrigation. The ordinance also allows development projects with more than one building across one or more parcels to pursue onsite non-potable water reuse at two different scales. The project could implement building-scale water reuse (Figure 1), with each building having its own onsite water reuse system constructed and operating independently from the others, or the project could implement district-scale water reuse (Figure 2), with a single district-scale water reuse system collecting supply from and distributing non-potable water back to all of the buildings.
The purpose of this memorandum is to provide information on district-scale water reuse systems, considerations for implementing a district-scale reuse system, and a recommendation for requiring new developments with more than one building to install a district-scale reuse system. District-scale water reuse systems have additional benefits compared to individual building treatment systems, as economies of scale can result in significantly lower capital costs, lower total energy consumption, and lower total footprint of treatment and storage equipment. The potential benefits and challenges a project may encounter with a district system are described, along with a detailed economic analysis to illustrate the cost effectiveness of district-scale systems. Summary case studies and lessons learned are provided for a selection of precedent projects, some located in San Francisco and some elsewhere, to provide further context on successful district-scale water reuse applications. Among these case studies, there tended to be multiple factors that motivated the development of each district scale system: compliance with regulatory requirements, LEED certification and environmental branding for the developer, and a competitive bid process that selected for the most sustainable site designs. Challenges involved overcoming administrative complexities, uncertainty around how to comply with policy and regulation, and availability of supplemental funding for the larger district-scale systems.
2 January 3, 2022
District-scale System Benefits and Challenges:
A multi-building project that pursues a single district-scale onsite reuse system has several advantages over an approach using individual reuse systems for each building. The district-scale approach also has some challenges, especially for a system that seeks to combine multiple development partners. A high-level summary of key benefits and challenges is presented below; more detail and explanation of these bullets are provided in the sections that follow.
Key Benefits:
• Lower overall initial capital costs and long-term operation costs, due to economies of scale
• Shorter payback period (return on investment)
• Less physical building space needed
• Higher performance (increased potable water offset) achieved • Scalability and flexibility for future expansion
• Long term resiliency
Key Challenges:
• Balancing larger initial capital expenditures across phases • Schedule challenges related to building occupancy and system startup • Requires early commitments and development of sometimes complicated ownership and maintenance agreements
• Crossing property lines when installing plumbing infrastructure in the public right-of-way
District-scale System Cost Analysis:
To better understand the relative costs of building-scale versus district-scale non-potable reuse system approaches, and the potential for economies of scale benefits for larger systems, staff reviewed and summarized analysis from a recent USEPA study1 and examined trends in available cost data for projects with reuse systems. The main points are included here:
• Overall, the data is clear that a larger reuse system will be more cost effective, both in first and ongoing costs, compared to implementing building-scale systems.
1 Life Cycle Assessment and Cost Analysis of Distributed Mixed Wastewater & Graywater Treatment for Water Recycling in the Context of an Urban Case Study” (USEPA 2019)
3 January 3, 2022
• The life cycle cost of the district-scale project shows a significantly better return on investment, especially for blackwater reuse systems. This is the result of the higher performance and associated potable water offset achieved by district-scale and blackwater projects, and resultant increases in savings over the life of the project.
• The operations and maintenance (O&M) unit costs for the district-scale project scenarios are about 35% lower than building-scale scenarios due to economies of scale.
• The construction cost component is lower for blackwater systems than graywater systems. This indicates that the two systems (blackwater vs graywater) have equivalent costs for treatment and distribution equipment, but there is an increased cost for dual collection piping in a graywater system. The relative difference in construction unit costs between blackwater and graywater systems is even greater, owing to the increased performance and cost effectiveness achieved by blackwater systems. • Larger systems tend to have a more consistent cost per size of system at the low end of the range (averaging around $25 per gallon per day) for the treatment system and $2.40 per gallon per day for the annual O&M), whereas for building-scale projects the unit costs vary considerably (ranging $50 - $356 per gallon per day for the treatment system and $6.67 – $18.14 per gallon per day) and are uniformly higher than the larger systems, often significantly so.
Therefore, it is recommended to require new developments with more than one building to install a district-scale reuse system. District-scale water reuse systems have additional benefits compared to individual building treatment systems, as economies of scale can result in significantly lower capital costs, lower total energy consumption, and lower total footprint of treatment and storage equipment.
Figure 1. Building-scale vs District-scale Onsite Reuse Schematics
4 January 3, 2022
1. SFPUC’s Local Water Program
The SFPUC is committed to an innovative approach to water resources management. The SFPUC is implementing several programs and projects that are diversifying the City’s water supply portfolio and ensuring resilient water sources for the future. The SFPUC’s water conservation program includes many efforts to help residences and business save water. One example is the Plumbing Fixture Replacement Program, a toilet and urinal direct installation program that connects residences and businesses to plumbers for retrofitting inefficient fixtures. Another example is the Leak Alert Program, which notifies customers of a potential leak by sending an email, text, letter, and phone call and advises to contact a plumber. In addition, the SFPUC is committed to developing local groundwater to enhance the City’s drinking water supply. More information on the SFPUC’s water conservation program is available at
https://sfpuc.org/learning/conserve-water. The SFPUC also promotes the use of recycled water for irrigation at Harding Park and Fleming Golf Courses, and Sharp Park Golf Course. Additionally, construction continues on the Westside Enhanced Water Recycling Project, which will begin providing recycled water in 2022 for irrigating Golden Gate Park, the Panhandle, Lincoln Park Golf Course, and the San Francisco Zoo. Also underway is a satellite treatment facility feasibility study to evaluate options to deliver recycled water to dual- plumbed buildings on the eastside of San Francisco. In addition, the SFPUC implements the City’s mandatory requirement for onsite water reuse in new large buildings. The SFPUC provides grant funding to encourage retail water users to install onsite water reuse systems, as well as encourage the installation of onsite treatment and reuse of brewery process water.
2. Non-potable Water Ordinance
In September 2012, the City and County of San Francisco adopted the Non- potable Water Ordinance (NPO). It added Article 12C to the San Francisco Health Code allowing for the collection, treatment, and use of alternate water sources such as graywater, rainwater, stormwater, blackwater, and foundation drainage for non-potable applications such as toilet flushing and irrigation. The following alternate water sources are defined as:
• Graywater: untreated wastewater that includes, but is not limited to, wastewater from bathtubs, showers, bathroom sinks, clothes washing machines, and laundry tubs, but does not include wastewater from kitchen sinks or dishwashers.
• Blackwater: includes graywater and is defined as wastewater containing bodily or other biological wastes, as from toilets, dishwashers, kitchen sinks and utility sinks.
• Rainwater: precipitation collected from roof surfaces or other manmade, above ground collection surfaces.
5 January 3, 2022
• Stormwater: precipitation collected from at-grade or below grade surfaces or from any surface where hydrocarbon-based fuels, hazardous materials, or fertilizers are stored or used. • Foundation drainage: nuisance groundwater that is extracted to maintain a building's or facility’s structural integrity and would otherwise be discharged to the sanitary or combined sewer system. • Condensate: Water vapor collected from air conditioning systems.
A streamlined permitting process was developed through a joint collaboration with the SFPUC, San Francisco Department of Public Health (SFDPH), San Francisco Department of Building Inspection (SFDBI), and San Francisco Department of Public Works (SFPW). Water quality, monitoring, and reporting requirements were established, giving regulatory oversight and management over onsite non-potable water systems to the Department of Public Health.
In 2013, the Board of Supervisors amended the NPO to allow district-scale non- potable water systems consisting of two or more buildings sharing non-potable water. Subsequently, the Ordinance was amended in July 2015 to mandate the installation of onsite water systems in new developments of 250,000 gross square feet or more. And the Ordinance was amended again in 2016 to clarify implementation requirements for district-scale systems.
Most recently in October 2021, the Board of Supervisors amended the NPO to further increase opportunities for potable water savings from new developments and streamline the requirements. The ordinance amendments require new development projects that apply for a site permit after January 1, 2022 of 100,000 gross square feet or more to install and operate an onsite water reuse system. The required alternate water sources and required non-potable uses are based on development project type. For commercial buildings, the project must meet its toilet and urinal flushing and drain trap priming demands through the collection, treatment, and use of available blackwater and condensate. For residential and mixed-use buildings, the project must meet its toilet and urinal flushing, irrigation, clothes washing, and drain trap priming demands through the collection, treatment, and use of available graywater and condensate. The requirements apply to both development projects consisting of a single building or multiple buildings.
3. District-scale System Benefits and Challenges
A multi-building project that pursues a district-scale onsite reuse system has several advantages over an approach involving separate reuse systems for each building. These benefits have been organized into three general categories:
financial, operational, and practical. The district-scale approach also has some challenges, especially for a system that seeks to combine multiple development partners. Possible mitigation strategies are included to address these challenges.
6 January 3, 2022
Financial Benefits:
• Economies of scale allow lower overall initial capital costs for a single system serving multiple buildings instead of individual systems per building.
• Reduced long-term O&M costs due to lower labor, materials, and inputs (e.g., energy, chemicals) associated with a district-scale system instead of multiple systems in different locations.
• Increased overall performance (i.e., potable water offset) results in greater savings from reduced water and sewer fees. Coupled with the economies of scale achieved in capital and O&M costs, a multi-building project will typically have a much greater cost effectiveness ($/gal potable offset) when pursuing a district-scale system over a building-scale approach. • Payback period (return on investment) is often shorter due to lower overall construction costs, lower overall annual O&M costs, and greater savings from reduced water/sewer charges.
• A district-scale system requires less physical building space than multiple separate building systems, freeing up valuable real estate.
Operational Benefits:
• Higher performance: the ability to balance supply and demand from different building or use types (e.g., commercial, residential, landscape) to optimize efficiencies in potable water savings, water storage needs, and sewer overflow. This allows a district-scale project more opportunity to utilizing the available resource (wastewater as an alternative water source) and maximize the potential potable water offset achieved.
• Opportunity to expand water reuse system and export non-potable water to users outside the district (e.g., an adjacent development) further increasing performance and offsetting costs.
• Reduces the number of utility service connections between the project and the City system (e.g. potable water backup and sewer overflow).
This reduces system costs and complexity, and benefits both the City and developer by simplifying the interfaces between public and private utilities.
• For multi-parcel projects, simplifies the servicing of shared water demands outside the buildings or on a separate parcel. For example, for a project with a park or open space area on a separate parcel it is straightforward to provide non-potable supply for irrigation and bathroom demands from a district-scale system. For a building-scale
7 January 3, 2022
approach in this scenario, there is additional complexity to determine how to supply these demands (e.g., which building/owner to tie into) and the likelihood that performance will be lower (e.g., the open space area will use less non-potable water annually).
• Some larger district-scale projects involve a 3rd party entity (e.g., vendor or non-profit utility) to operate the system. This benefits the developer(s) by reducing the operational roles they must fill and allows them to transfer responsibility for compliance, along with the associated risks and costs, over to that entity.
Practical Benefits:
• Limits the implications associated with any necessary future upgrades or retrofits (i.e., only one system to upgrade).
• Scalability; a project can incorporate flexibility for future expansion (i.e., incremental system expansion to incorporate additional supply and/or demand instead of building an entirely new system) if a project anticipates uncertain development timelines or changing growth patterns.
• A larger or more integrated system (e.g., a district-scale system balancing supply and demand to increase performance overall compared to what would be possible with separate building systems) may provide additional opportunities for stormwater compliance or other regulatory efficiencies (e.g., contribute toward San Francisco’s Stormwater Management Ordinance requirements through reduced wastewater discharge).
• Larger systems have more potential for alternative delivery, such as a public-private partnership with the SFPUC or partnering with a qualified operator able to finance the construction and operation of the system, accept the inherent development risk, and recoup their expenses through the sale of non-potable water.
• Long term resiliency; higher performance and cost effectiveness help secure a consistent non-potable water source that is insulated from some external factors (e.g., extended drought or water rate increases) and ensure price stability on that source.
District-scale System Challenges:
• Balancing initial capital expenditures if the project is developed in phases - the initial phase, with construction of the district-scale system,
8 January 3, 2022
will carry a disproportionate amount of the associated system construction costs.
o Mitigation: Pursue opportunities to offset costs, such as through public grants, operator financing, or alternative project delivery models (e.g., public-private partnership).
• Schedule/phasing challenges - Less flexibility and potential schedule challenges around phasing and occupancy of buildings and system startup (e.g., if a minimum consistent rate of supply is needed to operate system).
o Mitigation: Plan for a district-scale approach at a very early stage in project planning and design, to incorporate scalability and account for building phases/schedule.
• Ownership & maintenance agreements are needed. Requires owner commitments early in the planning process, developing and executing legal agreements (between different property owners and/or the system owner and operator), and addressing the associated administrative, operational, or liability challenges. Establishing or designating one entity to be responsible for compliance with San Francisco’s Non- potable Ordinance may be challenging if there are multiple property owners.
o Mitigation: Apply processes and lessons from other
development partner arrangements or district-scale utilities with established practices, such as district energy.
• May require the creation of an independent entity, such as an HOA or non-profit utility, to manage the system, contract with an operator, and administer the sale of non-potable water to end users.
o Mitigation: The CA Public Utility Code allows adjoining properties, as well as associations organized to deliver water to its members at cost, to operate without becoming public utilities.
However, there is not a clear tipping point between “a group of neighbors” and the “public”, therefore case-by-case analysis of district-scale proposals will be needed.
• How and where to locate district-scale water reuse equipment - if the space requirements of the system are incompatible with the development or, if there are multiple development partners, how to equitably locate and account for the loss of space/use in the building.
o Mitigation: Early planning and consideration of a central plant facility, especially if the development will incorporate other district utilities.
9 January 3, 2022
• If a district-scale system is down for maintenance, there will be a large temporary increase in municipal water use and sewer discharge volume that the developer will be responsible for.
o Mitigation: Coordinate with the City to plan system shutdowns for periods of lower water consumption and dry weather. • Crossing property lines and/or encroaching on the public rights-of-way – not a significant issue in practice (there is a standard City permitting process for crossing or encroaching on the ROW) but shared infrastructure between parcels or private infrastructure within the ROW may not be familiar to a developer and thus may create the perception of complexity or challenges
o Mitigation: Messaging and education from the SFPUC to the development community to share mechanisms and best practices.
4. District-Scale System Cost Analysis
The financial implications of a district-scale reuse system occupy both key benefits and challenges to implementation. Staff undertook an economic analysis to show the relationship between system scope and costs and demonstrate the economies-of-scale achieved by larger district-scale reuse systems.
Onsite Water Reuse Cost Factors:
The following components represent the main cost elements of an onsite water reuse system.
• Initial Capital Cost – The first costs, both soft and hard, relate to the design and construction of the collection, treatment, and distribution components of the onsite reuse system.
• Ongoing Operating Costs – Significant over the life of the project, the annual operations & maintenance cost typically represent the majority the life cycle cost for an onsite reuse system.
• Ongoing Avoided Water and Sewer Fees – An onsite reuse system will result in long term savings due to reduced potable water consumption and reduced wastewater discharge to the City sewer system.
• Loss of Building Area – Onsite reuse system require space to house the treatment, storage, and pumping equipment, typically in a dedicated room within the ground floor or basement.
Initial Capital Costs:
Though projects have myriad differences in equipment and approach that can
10 January 3, 2022
influence construction costs, it is reasonable to summarize the major capital cost components along the following lines.
• Graywater Collection Plumbing – Some reuse systems, particularly those within building-scale residential buildings, will include dual plumbing withing the building to collect graywater supply (defined as wastewater from clothes washers, bathtubs, showers, and bathroom sinks) separate from the total combined wastewater (or blackwater defined as wastewater from toilets, dishwashers, kitchen sinks, and utility sinks).
• Treatment/Storage/Pumping Equipment – All projects will include treatment, storage (often very large if rainwater is also being collected), and pumping equipment, either located within each building or centralized somewhere within the district.
• NPW Distribution Plumbing – All projects will include a dual plumbing inside the building to distribute non-potable water to the end uses (e.g., toilets or irrigation).
• NPW Distribution Pipes – Most district-scale projects will also need water piping outside of the buildings, within the parcel(s) and/or right- of-way, to distribute non-potable water from the district-scale treatment system to all buildings and end uses.
Based on a previous analysis of overall construction costs for recent building- scale graywater systems in San Francisco (which have typically incorporated rainwater harvesting and associated rainwater storage tanks) a representative system cost breakdown might look like the following:
• Treatment System: 50% ±10%
• Dual Plumbing
2: 35% ±10%
• Storage Tanks: 15% ±5%
Though the treatment system is going to be the bulk of the first cost, the dual plumbing for graywater collection could, based on limited available cost data, represent in the realm of 20% of the total system cost. District-scale systems will typically involve blackwater collection, with a savings realized by eliminating dual collection plumbing. Based on the water balance of a project, there is also the opportunity to collect wastewater from only a subset of buildings to provide adequate supply for the entire project, further simplifying the source supply collection aspects of the project.
Ongoing Operating Costs:
The ongoing operations and maintenance (O&M) costs include labor (operators, repair technicians, lab work), materials needed to repair and replace components, chemical inputs, solids disposal, and the cost of energy for pumping and treatment.
2 Includes both collection and distribution plumbing
11 January 3, 2022
The labor involved in O&M, for regular monitoring and sampling, preparing reports, and routing maintenance, is a significant portion of the overall cost and typically larger than the initial capital cost as a component of the total life cycle cost. There is a benefit to limiting the physical locations that an operator must visit to monitor equipment and take samples etc.
Ongoing Avoided Water and Sewer Fees:
Though an onsite reuse system adds initial and ongoing costs to a project, the reduction in potable water use also results in ongoing savings through lower utility fees. For building-scale projects, the savings will typically never surpass the costs over the life of a project, but as the amount of non-potable water produced increases, the value of the associated savings outpace the increase in costs.
Also, it is important to consider that water rates nationwide have tended to increase faster than the consumer price index which will improve the return on investment as the cost effectiveness from onsite reuse is likely to increase over time.
Loss of Building Area:
The loss of building area is challenging to quantify as a component of an overall life cycle cost analysis. However, it is a significant consideration, especially in the context of real estate value in San Francisco.
To get a sense of the impact, for a district-scale project serving 12 mid-rise buildings, the treatment and pumping equipment would require a space around 2,500 or 3,000 square feet. A single mid-rise building-scale reuse project would need a 600 to 900 square foot room for the reuse equipment. Comparing the two, 12 building-scale systems at 600 square feet each would require 7,200 square feet in total space. Per a recent industry real estate market report 3 the
average annual rent for Class A commercial space in San Francisco during Q3 2021 was $77.03 / square foot. Compared to a 3,000 square foot district-scale system, the additional space for the building-scale approach could “cost” over $300,000 per year in potential lost rent.
Cost Comparison:
To better understand the relative costs of building-scale versus district-scale non-potable reuse system approaches, and potential economy of scale benefits for larger systems, staff reviewed and summarized analysis from a recent USEPA study and examined trends in available cost data for projects with reuse systems.
3 https://www.cushmanwakefield.com/en/united-states/insights/us-marketbeats/san-francisco- marketbeats
12 January 3, 2022
USEPA Life Cycle Cost Analysis:
The USEPA recently completed a study, “Life Cycle Assessment and Cost Analysis of Distributed Mixed Wastewater & Graywater Treatment for Water Recycling in the Context of an Urban Case Study” (USEPA 2019), that examined the environmental and cost impacts of implementing onsite reuse projects at different scales (i.e., building-scale and district-scale).
The study developed a suite of project configurations representative of building or block size, building density, and water use in San Francisco’s South of Market district, based on comparisons with existing building statistics and satellite imagery of the area. Two representative projects, one building-scale and one district-scale and each considering either graywater or blackwater as the alternative water source, were analyzed for expected cost and performance.
• The building-scale representative project is a 19-story mixed-use building with 70% of building floor area allocated as residential and the remaining 30 percent as office space.
• The district-scale representative project
4 occupies a typical San
Francisco block area of approximately 230,000 ft
2 (5 acres). About 70%
of the block area was assumed to be covered by 4- to 6-story mixed-use commercial and residential buildings, with the remainder of the space taken up by sidewalks, parking, and open space.
The data from this study allows for some useful comparisons and conclusions about the differences in cost, and cost-effectiveness, between a representative building-scale and district-scale project in San Francisco. • The life cycle cost of the district-scale project shows a significantly better return on investment, especially for the blackwater scenario. This is the result of the higher performance (and associated potable water offset) achieved by district-scale and blackwater projects, and resultant increases in savings over the life of the project. Though the life cycle cost is greater (costs of $5.7M for district-scale vs $4.2M for building- scale) the cost savings due to avoided utility fees are even higher (savings of $9.6M for district-scale versus $4.8 for building-scale). • For both project scales, the construction cost component is lower for the blackwater source than the graywater source. This indicates that the two systems (blackwater vs graywater) have equivalent costs for treatment and distribution equipment, but there is an increased cost for dual collection piping in a graywater system. The relative difference in construction unit costs between blackwater and graywater systems is even greater, owing to the increased performance and cost effectiveness achieved by blackwater systems.
4 The district-scale representative project occupied a single block; therefore, the costs do not include non-potable water distribution plumbing in the street.
13 January 3, 2022
• The O&M unit costs for the district-scale project scenarios are about 35% lower than building-scale scenarios due to economies of scale.
The results of this analysis demonstrate the economic benefits of district-scale systems as described previously; lower overall capital costs, lower overall O&M costs, and greater cost effectiveness resulting in a better return-on- investment.
The characteristics of the representative projects used in the study are summarized in Table 1:
Table 1. Building and Occupancy Characteristics
Footprint
Building Area Residential
Occupants
Commercial
Occupants Total Resi Comm
(sf) (gsf) (gsf) (gsf)
Building-
Scale 20,000 380,000 270,000 110,000 520 590
District-
Scale 160,000 760,000 510,000 250,000 990 1,300
(sf) = square feet; (gsf) = gross square footage
Information was extracted from the study to compare the costs and performance of the representative building-scale and district scale projects. The performance information (i.e., the expected supply, demand, and non-potable reuse volumes) are summarized in the following table. For each representative project, the study looked at performance for either graywater or blackwater as the source collected for treatment.
The annual and daily reuse volumes calculated for these representative projects are equivalent to the performance observed in constructed projects for the larger district-scale systems. For the smaller building-scale project, the typical system capacity observed in constructed projects (most of them graywater) is closer to 6,000 gallons per day. The statistics seen in the USEPA study would thus be for a project that is designed to perform above and beyond the baseline of San Francisco’s Non-potable Ordinance requirements.
Table 2. Performance of Onsite Reuse Systems
Representative
Project
Water Reuse System Characteristics
Source
Scenario 1
Annual
Supply
Annual
Demand2
Annual
Reuse3
Daily
Reuse4
(MG/yr) (MG/yr) (MG/yr) (gpd)
Building-Scale Graywater 5.7 6.5 4.3 12,000
Blackwater 9.1 6.5 4.9 14,000
District-Scale Graywater 11.0 13.1 8.3 23,000
Blackwater 18.0 13.1 9.8 27,000
14 January 3, 2022
(MG/yr) = million gallons per year; (gpd) = gallons per day; M = million Notes:
1. The EPA study refers to blackwater as "Mixed Wastewater".
2. Annual demand used for this analysis were based on the study's "high reuse scenario" for non-potable reuse associated with current, average water demand.
3. Annual reuse in the EPA study was represented by the lesser of the annual supply and demand. To be conservative in estimating potable water rate savings for this cost comparison, an additional 25% reduction in annual reuse was applied.
4. Daily reuse as shown is simply the annual reuse estimate divided by 365 days; it is included as an approximation of system design capacity.
The study performed a detailed life cycle costs analysis to consider capital costs and annual or otherwise periodic costs associated with construction, operation, maintenance, and material replacement over a 30-year time horizon.
To compare the cost of implementation for the building-scale and district-scale representative projects, the life cycle costs for construction and ongoing operation were adjusted to 2020 dollars and the savings from avoided water and wastewater fees due to the potable water offset were quantified over the 30-year life cycle horizon. These costs and savings are summarized in Table 3. It shows that the life cycle cost of the district-scale project has a significantly better return on investment, especially for blackwater reuse systems. This is the result of the higher performance and associated potable water offset achieved by district-scale and blackwater projects, and resultant increases in savings over the life of the project.
Table 3. Life Cycle Cost Analysis Summary of Onsite Reuse Systems Representative
Project
Source
Scenario
Life Cycle Cost Analysis - NPV 1 Avoided
Utility
Cost -
NPV 4
Construction
Cost 2
O&M
Cost 3
Total
Cost
Building-Scale Graywater $1.8 M $2.6 M $4.4 M $(4.2) M
Blackwater $1.4 M $2.8 M $4.2 M $(4.8) M
District-Scale Graywater $3.0 M $3.2 M $6.2 M $(8.1) M
Blackwater $2.2 M $3.5 M $5.7 M $(9.6) M
M = million
Notes:
1. Costs shown represent Net Present Value for a 30-year lifespan. All costs are shown in 2020 dollars and were adjusted from the 2016 dollars shown in the EPA study based on the annual Consumer Price Index (CPI).
2. Construction Cost includes both total capital costs and interest during construction.
3. O&M Cost includes operation and maintenance labor, materials, chemicals, and energy purchases.
4. Avoided Utility Cost represents the savings from reduced potable water consumption and associated water and wastewater fees. These were recalculated using the SFPUC FY 2020- 21 rates for Water and Wastewater rates for commercial and MFR for the first year of operation, with an annual rate increase of 5%. The NPV calculations used a 5% discount rate and 30- year time horizon.
15 January 3, 2022
Finally, to understand the cost effectiveness of each approach and compare the costs in a standardized way, a simplified “equivalent unit cost” was calculated.
This was done by dividing each cost component from Table 3 by the daily reuse amount for each scenario, to get a “unit” cost rate per GPD of non-potable water produced. This is summarized in Table 4. It shows that the O&M unit costs for the district-scale project scenarios are about 35% lower than building-scale scenarios due to economies of scale. Also, the construction cost component is lower for blackwater systems than graywater systems. This indicates that the two systems (blackwater vs graywater) have equivalent costs for treatment and distribution equipment, but there is an increased cost for dual collection piping in a graywater system. The relative difference in construction unit costs between blackwater and graywater systems is even greater, owing to the increased performance and cost effectiveness achieved by blackwater systems.
Table 4. Cost Effectiveness Summary of Onsite Reuse Systems Representative
Project
Source
Scenario
Daily
Reuse
NPV Equivalent Unit Costs 1
Const. O&M Savings 2 Overall 3
(gpd) ($ / gpd) ($ / gpd) ($ / gpd) ($ / gpd)
Building-
Scale
Graywater 12,000 $150 $217 $(350) $17
Blackwater 14,000 $100 $200 $(343) $(43)
District-Scale Graywater 23,000 $130 $139 $(352) $(83)
Blackwater 27,000 $81 $130 $(356) $(144)
(gpd) = gallons per day; ($ / gpd) = cost per gpd of daily reuse Notes:
1. To compare the four scenarios on an equivalent unit basis, the NPV costs are divided by daily reuse (equivalent to the system capacity or size of the treatment equipment).
2. The savings from avoided utility costs is equivalent across all scenarios – variations shown in the table are due only to rounding errors in the data and calculations.
3. To illustrate the net benefit of savings due to increased potable water reduction, this overall cost is calculated as (Construction Cost NPV) + (O&M Cost NPV) – (Savings NPV)
Project Database Cost Comparison:
To complement the cost analysis from the USEPA study, staff examined data aggregated from available project information that was developed and/or compiled for a variety of recent efforts:
• SFPUC Onsite Water Reuse System Case Studies (2021)
• Port of SF Pier 70 Building-scale Cost Study (2019)
• SFPUC District-Scale Utilities Case Studies Memo (2013) • Limited additional precedent project research
In total, the database developed from this effort had about 40 projects, but only 25 included any cost data of any kind and of those only about 15 had sufficient cost and project data to be utilized for comparison. Though limited in scope and difficult to fully verify the accuracy, this data set still allows for some useful analysis and comparison of projects of varying scope and size.
16 January 3, 2022
To understand the influence of project/system size on cost, the projects were divided into two groups based on onsite reuse system capacity (i.e., gallons per day of non-potable water produced) – those with building-scale systems and those with larger capacity reuse systems, some district-scale and some very large single buildings (but of a scope that would be similar to a district-scale project).
The system capacities and building sizes are summarized in the table below.
Table 5. Precedent Project Characteristics
Reuse System
Scale
System Capacity
(gpd)
Total Building Area
(gsf)
Average Range Average Range
Building-Scale
Systems 5,000 2,700 – 7,000 440,000 128,000 – 838,000
District-Scale and
Larger Building-
Scale Systems
100,000 25,000 – 206,000 1,030,000 375,000 –
2,400,00
(gpd) = gallons per day; (gsf) = gross square footage
There was not sufficient cost data to compare the total cost of the onsite reuse system implementation (i.e., including all plumbing, piping, storage, etc) however enough of the project data had costs associated with the treatment systems and annual O&M to compare those. These costs are summarized in the table below.
Table 6. Precedent Project Costs
Reuse System Scale
Treatment System Cost Annual O&M Cost
Average Range Average Range
Building-Scale
Systems $625,000 $300,000 - $960,000 $61,000 $50,000 - $120,000 District-Scale and
Larger Building-Scale
Systems
$3,000,000 $560,000 - $9,580,000 $290,000 $50,000 - $800,000
The smaller systems have a much narrower range of costs for both the treatment system capital cost and the ongoing O&M, suggesting that at the scale of those systems there is a baseline cost to implement any reuse system and this baseline is less dependent on the specific design capacity. The larger systems have a broad range of system capacities. As expected, these costs range significantly and correlate better to the system size.
The cost implications for a building-scale system versus a larger system (e.g., district-scale) are easier to see when the costs are compared on a more equivalent unit basis. To do this, the treatment system and O&M costs were
17 January 3, 2022
divided by system capacity to get a unit cost per GPD of capacity. The larger systems have a more consistent cost per size of system at the low end of the range, whereas for the smaller projects the unit costs vary considerably and are uniformly higher than the larger systems, often significantly so. These unit cost overages and ranges are shown in the table below.
Table 7. Precedent Project Costs
Reuse System Scale
Treatment System Unit Cost
($/gpd)
Annual O&M Unit Cost
($/gpd)
Average Range Average Range
Building-Scale Systems $143 $50 - $356 $9.35 $6.67 – 18.14 District-Scale and Larger
Building-Scale Systems $25 $10 - 52 $2.39 $0.94 – 4.36
($/gpd) = cost per gallon per day of treatment system capacity Overall, this data set makes it clear that a larger district-scale reuse system will be more cost effective, both in first and ongoing costs, compared to implementing multiple smaller building-scale systems.
5. District-scale Water Reuse Precedent Projects
To provide more context on district-scale reuse projects and examples of successful and innovative implementation, staff summarized descriptions and other key lessons learned for a subset of the projects used in the precedent project cost database. The tables below summarize the building and reuse system characteristics for each project.
Table 8. Precedent Project Building Characteristics
Name Location Status Building
Type Scale
Building Size
Residential
Units
Commercial
GSF
Total
GSF
Solaire New York
City Built (2003) Residential 2 Buildings
(0.4 acres) 293 0 383,000
Uber HQ San
Francisco Built (2019) Commercial 2 Buildings
(1.6 acres) 0 475,873 475,873
Hasolo on
8 th
Portland,
OR Built (2015) Mixed-use 3 Buildings
(3 acres) 657 329,700 922,300
Chase
Center
San
Francisco Built (2019) Commercial
Multiple
Blocks
(12.5 acres)
0 680,000 1,480,000
Mission
Rock
San
Francisco
Under
Construction Mixed-use Neighborhood
(28 acres) 1,200 1,500,000 2,440,000
18 January 3, 2022
WaterHub
at Emory
University
Atlanta,
GA Built (2015) Institutional Campus
(90 acres) Not available5
Table 9. Precedent Project Reuse System Characteristics
Name
Supply and Demand Performance
Alternative
Water Sources
Non-potable Uses System
Capacity
(gal/day)
Potable Water
Offset
(gal/yr)
Potable
Reduction
Target (%)
Solaire - Blackwater
- Rainwater
- Irrigation
- Toilet Flushing
- Cooling
25,000 9,000,000 50%
Uber HQ - Graywater
- Rainwater
- Irrigation
- Toilet Flushing
- Cooling
2,700 700,000 22%
Hasolo on
8th - Blackwater
- Irrigation
- Toilet Flushing
- Cooling
45,000 7,300,00 50%
Chase
Center
- Graywater
- Rainwater
- Condensate
- Irrigation
- Toilet Flushing 53,000 3,800,000 34%
Mission
Rock - Blackwater
- Irrigation
- Toilet Flushing
- Cooling
43,000 11,800,000 17%
WaterHub
at Emory
University
- Blackwater
- Toilet Flushing
- Cooling
- Boiler
440,000 51,000,000 40%
Chase Center (San Francisco):
The Chase Center arena was developed across an entire city block in the Mission Bay neighborhood. Completed in 2019, the waterfront development includes the arena that is home to the Golden State Warriors, a 3.2-acre public plaza, 100,000 square feet of retail space, and two commercial buildings on either western corner of the block that together house 580,000 square feet of office space. The development’s onsite district-scale water reuse system collects graywater from within the two office buildings, condensate and bleed from the HVAC systems, rainwater from all building roofs, and stormwater from the outdoor plaza and the office buildings’ mid-level/podium rooftop outdoor spaces. The treatment system has two parallel units that can be operated individually or in unison up to 53,000 gallons per day, depending on the capacity needs. Non-potable water is used for irrigation and toilet/urinal flushing, reducing the project’s potable water demand by an estimated 34%.
The development benefits from a district-scale system because most of the graywater supply is generated at the office buildings, while the highest demand
5 Water treated onsite is used in utilities to heat and cool buildings and for toilet flushing in some residence halls.
19 January 3, 2022
for non-potable water is toilet/urinal flushing at the arena during events. With its district-scale system, water can be collected from office buildings during the day and recycled at the arena in the evening. This allows for more efficient allocation of non-potable water and decreases the development’s overall potable water demand much more than if each building had an isolated system of collection, treatment, and reuse.
The Chase Center project also benefits from its district-scale system because the integrated system helped it achieve compliance with multiple regulatory requirements. The San Francisco Stormwater Management Ordinance necessitated the use of rainwater harvesting, green roofs, and infiltrative BMPs to capture and treat stormwater and the San Francisco Non-Potable Ordinance required the development to meet its toilet/urinal flushing and irrigation demands using non-potable water. It simplified site design and was more cost effective for the developer to meet both sets of requirements by planning an integrated system for the entire development site rather than for each building separately.
Uber Headquarters (San Francisco):
Opened in 2021, Uber’s new San Francisco headquarters in Mission Bay is located on the block immediately north of the Chase Center. The headquarters comprises two buildings next to each other, Mission Bay 1 (a 182,530 square foot, 11-story building) and Mission Bay 2 (a 223,680 square foot, 6-story building). The two commercial buildings at the Chase Center are also part of Uber’s campus (Mission Bay 3 and Mission Bay 4) but they are connected to the Chase Center’s district-scale water reuse system.
The project was designed with numerous eco-friendly and energy-efficient systems that improve its environmental footprint, including district-scale water reuse. Graywater and rainwater are collected from both buildings and routed to a district-scale treatment facility at Mission Bay 2. The graywater and rainwater supplies undergo separate treatment processes before combining in a treated water storage tank that serves as the non-potable water supply for both building’s toilet flushing and irrigation demands, together reducing the potable water use by an estimated 22%. Designing the facility to process the two sources of influent through separate treatment trains reduced the overall system size and cost of the treatment facility.
The main driver for Uber HQ’s onsite water reuse system was achieving compliance with the San Francisco Non-Potable Water Ordinance, Article 12C, and it was the first Article 12C project permitted as a district-scale system.
Mission Rock (San Francisco):
Mission Rock will be a new mixed-used neighborhood spread over 28 acres, including parks, open space, residential, commercial, and retail. The development will feature a district-scale water reuse system with an advanced water recycling facility, located on the ground floor of one of the office
20 January 3, 2022
buildings, treating a portion of the blackwater from the Mission Rock development to meet the non-potable water needs of the neighborhood including toilet flushing, cooling tower makeup water, and open space irrigation.
The district-scare water reuse system was implemented for compliance with the San Francisco Non-Potable Ordinance, but also helped to meet the goals of the Sustainability Strategy created by the Port as part of their Disposition and Development Agreement. The Sustainability Strategy contained performance goals for the neighborhood’s district utilities: meet 100% of building energy demands with renewable energy and 100% of the non-potable water demands with non-potable sources.
The water reuse system is planned to be financed through 100% debt-financing, based on long-term utility service agreements that will require each property at Mission Rock to be a customer of the utility systems. The system will be financed in phases with the initial financing expected to be funded over several years through exempt facility, private activity tax-exempt revenue bonds, and taxable revenue bonds. Future Mission Rock public financing sources may contribute to paying down the financing.
The developer formed a non-profit utility, Mission Rock Utilities, Inc. (MRU), for the exclusive purpose of serving the Mission Rock site district utilities (energy and water). MRU will enter into long-term utility service agreements to secure revenue bond or construction financing. Energy and water rates will be cost-based and will include provisions for recovery of all capital and operational costs.
MRU will consist of a Board of Directors, that will approve annual budgets and each system’s rates, with third party operations and management teams. The daily business activities of MRU will be managed by Evergreen Energy, through a Management Services Agreement. Daily operation and maintenance of the district energy and water reuse systems are anticipated to be provided by two separate entities under contract with MRU. Developer personnel, likely engineering staff serving the broader Mission Rock project, will operate and manage both utility systems. A Contract Blackwater Recycling System Operations Firm will provide process operations and membrane maintenance functions for the blackwater recycling system and will serve as the Treatment System Manager.
The Solaire (New York City):
Battery Park City is a community of commercial, residential, retail, and park space in a 92-acre region of Manhattan’s Lower West Side. The Battery Park City Authority (BPCA), a public-benefit corporation founded in 1968, has managed the redevelopment of the area. In 2000, the BPCA published its Residential Environmental Building Guidelines that include water conservation and reuse requirements intended to minimize the impact of development on NYC’s sewer system and to conserve potable water.
21 January 3, 2022
The first building constructed after these guidelines were published was the Solaire, a LEED gold residential high-rise tower with an onsite water reuse system was designed, constructed, and continues to be operated by a third-party vendor. The system was designed the system to meet LEED criteria and to qualify for reduced water/sewer charges and tax credits. The system has two parallel processes of collection and treatment to recycle blackwater and rainwater. The treated water is distributed for toilet flushing, HVAC cooling tower make-up, and for irrigation on the building’s green roofs and in an adjacent park.
The reuse system was designed to be scalable and supply non-potable water to an adjacent apartment building, the Verdesian, that would be completed three years after the Solaire. Incorporating this forward-thinking plan to expand to a district-scale system streamlined the process for the Verdesian to achieve compliance with the BPCA’s water conservation and reuse requirements and helped it achieve LEED platinum accreditation without its own treatment system. It also saved valuable real-estate within the Verdesian for what would have been an essentially redundant reuse system.
In the ten years after the BPCA’s publication of their Environmental Guidelines, eight residential towers were constructed in Battery Park City, all of which utilize onsite blackwater and stormwater reuse systems. Each of the buildings’ wastewater residuals are discharged to the city’s combined sewer only when it isn’t raining and there are no CSO’s occurring. The reuse systems are designed so that they only treat the amount of wastewater needed to meet their non- potable demands and the rest is discharged to the sewer. All systems recycle blackwater instead of graywater as it was determined that the dual graywater collection plumbing made them less cost effective.
Hasolo on 8
th (Portland):
Hasolo on 8th is a three-acre sustainable urban development that consists of three LEED platinum residential buildings and a community plaza. The project has an onsite water reuse system that utilizes 100% of the buildings’ wastewater for toilet flushing, cooling system make-up, and irrigation, with any excess treated water injected into dry wells for groundwater recharge. All bio-solids are filtered out of the wastewater and are used as byproducts for fertilizer and fuel offsite. By recycling the treated wastewater to meet its non-potable needs, the project reduces its potable water usage by 50%.
The City of Portland collaborated with developer to implement the onsite wastewater treatment system, offering policy support and financial support by refunding a significant portion of their system development charges, which are typically assessed for developments’ reliance on city services and infrastructure such as the sanitary sewer. For its reduced reliance on the City’s potable water and sewer, Hasolo on 8
th estimates a 65% reduction in its water utility costs.
The incorporation of an onsite wastewater recycling system was motivated by
22 January 3, 2022
achieving LEED platinum certification and aligning with developer goes for resilience, urban ecology, and biophilia. Challenges to overcome were user perceptions of wastewater reuse, spatial constraints, the initial capital required and long-term return on investment, and obtaining approvals from the regulatory agency.
WaterHub at Emory University (Atlanta):
The WaterHub at Emory University is a district-scale blackwater treatment system that went online in 2015. Wastewater is mined directly from the municipally owned sewer system on campus, and reclaimed water is provided to campus HVAC/utility systems (makeup supply for central chiller and steam plants). While the system currently serves five central utility plants, the non- potable service will expand to as many as five other campus-owned utility systems over the next few years, including the University Hospital. In addition to servicing campus utilities, the distribution network is connected to a residential dormitory to deliver non-potable water for toilet flushing. Emory University plans to connect the system to dormitories coming online in the future that are designed to accepted non-potable water.
In the last decade, Atlanta has witnessed numerous water-related stresses, including severe drought. The EPA mandated consent decrees to resolve critical water infrastructure failures and an extended political dispute over water rights in the so-called “Tri-State Water Wars”. As a result of these challenges, Emory University set out to explore ways to minimize its impact on community water resources and the environment with a more strategic and impactful water management solution: campus-wide water reclamation and reuse.
Through a Water Processing Agreement (WPA), a third-party entity designed, built, commissioned, and continues to oversee operations of the district-scale system on behalf of the university. Under a services agreement, an operator takes responsibility for the ongoing operations, maintenance, and compliance.
This model eliminates development and operational risk for the client while delivering long-term savings through a guaranteed discounted rate structure.
The district-scale system creates lower cost water at a stable rate and is expected to save millions of dollars in water utility costs to Emory over a 20- year period. The system aligns with the University’s vision for a sustainable campus and reduces the overall water demand on one of the smallest municipal watersheds in the United States.
Key Lessons Learned:
Among these case studies, there tended to be multiple factors that motivated the development of each district scale system: compliance with regulatory requirements, LEED certification and environmental branding for the developer, and a competitive bid process that selected for the most sustainable site designs.
Interestingly, Battery Park City (where the Solaire is located), Hasolo on 8 th,
and Mission Rock are all district-scale redevelopment sites with management
23 January 3, 2022
themes that focus on environmental sustainability. Because Mission Rock and Hasolo on 8th were both master planned efforts, their sources of wastewater and demands for recycled water could be approximated well-enough to allow for treatment system design and layout during the development’s planning stages.
Battery Park City is different in that it was not master planned, so its future supplies and demands of water were too unknown to feasibly plan a district scale system from the outset that would be able to serve the entire district.
The most challenging aspects of developing the district-scale blackwater projects at Solaire and Mission Rock had to do with overcoming policy and administrative challenges rather than technical ones, since both were the first of their kind in New York City and San Francisco, respectively. For the Solaire, the project staff had to advocate to city commissioners to get the project approved since at the time city code did not allow blackwater reuse. For Mission Rock, one challenge the team is working through with SFPUC is how billing will be managed.
Uncertainty around how to comply with policy and regulation was also a challenge for the Uber HQ project. The manufacturer of the systems had to seek clarification from the SFPUC and its 3
rd party consultants about Article 12C and
its supporting documents on multiple occasions. This iterative process helped the SFPUC more fully understand how projects can move forward under the new Article 12C regulatory framework. The manufacturer’s approved treatment train was able to become the basis of design for future Article 12C projects.
For some projects, the availability of supplemental funding to build the district- scale system created challenges around the timing of planning and design. Key takeaways were to initiate detailed design earlier rather than waiting for funding, to allow more time to evaluate design considerations, create a roadmap of criteria to achieve necessary municipal approvals, and avoid unnecessary overdesign of the treatment system.
Recommendation for District-Scale Water Reuse:
• It recommended to require new developments with more than one building to install a district-scale reuse system. District-scale water reuse systems have additional benefits compared to individual building treatment systems, as economies of scale can result in significantly lower capital costs, lower total energy consumption, and lower total footprint of treatment and storage equipment