Nutrient Reduction Strategies for Wastewater Treatment Facilities for Lake Winnipeg: Cost‐Benefit Analysis using an Ecological Goods and Services Approach Final Report
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Municipal wastewater effluent is currently one of the many sources of nutrients to Lake Winnipeg. Recently, the province and its larger municipalities have identified specific steps to reduce nutrient loadings from wastewater releases, and these are currently being implemented. Challenges, however, exist for smaller municipalities and communities to reduce their nutrient loadings within their available financial and other resource constraints. In March 2010, Marbek, with CH2M Hill, completed a report on behalf of Manitoba Water Stewardship (MWS) to assess options for nutrient reduction from wastewater facilities serving small communities in Manitoba, called Evaluation of Nutrient Reduction Strategies for Wastewater Treatment Facilities in Manitoba (hereafter called the Background Report). This report builds on the work undertaken by Marbek for MWS by applying Environment Canada’s analytical framework for decisions involving ecological goods and services (EG&S) to evaluate nutrient reduction strategies for wastewater treatment facilities suitable for small communities in Manitoba. Specifically, we analyze the costs and benefits for five different wastewater treatment strategies (Biological Nutrient Removal (BNR) and Sequencing Batch Reactors (SBR), Free Water Surface Wetlands, Land Application and Chemical Precipitation) in three community sizes of 500, 2,000 and 10,000 people. A formal cost‐benefit analysis using the EG&S framework was conducted using the Chemical Precipitation strategy as the reference case and analyzed the net present value (NPV) of implementing one of the other identified wastewater treatment systems. Although Chemical Precipitation is not currently in widespread use in Manitoba, this strategy is used as a reference case to provide a consistent benchmark for comparison and because it is often viewed as the least cost wastewater treatment strategy. Cost‐benefit analysis is an important decision‐making tool to assess development scenarios in terms of their impacts on social welfare. To include EG&S values in the analysis, we first identify the potential suite of EG&S benefits. Second, we determine the relative difference in human and environmental impacts between each of the wastewater treatment strategies and the reference case scenario (i.e., the Chemical Precipitation strategy). Finally, we monetize the quantified EG&S values to the extent possible, employing a variety of market and non‐market valuation techniques. Excluding consideration of EG&S benefits, the Chemical Precipitation strategy is the least cost wastewater treatment strategy for reducing phosphorus concentrations in wastewater effluents. Including EG&S values, the relative costs and benefits of the different wastewater treatment strategies change. The Land Application strategy using the travelling gun technology and the Wetland‐low cost strategy for all community sizes, as well as the Wetland‐high cost strategy for communities of 2,000 people, become more cost competitive than the Chemical Precipitation strategy when EG&S are included. Exhibit 1 presents the incremental (i.e., additional to the reference case, Chemical Precipitation, wastewater treatment strategy) NPV with EG&S of the different wastewater treatment strategies for the three community sizes, relative to Chemical Precipitation, over a 20 year period, and discounted at 3%. Positive values in the graph suggest moving from the Chemical Precipitation strategy to the wastewater treatment strategy yields a positive net benefit to society while a negative value suggests negative net benefits. The results of this analysis are sensitive to many important variables and assumptions. We test the robustness of our results for differing values of nitrogen, values of carbon, different quantities of avoided irrigation water use and different discount rates. There are many uncertainties and limitations of our analysis that are described and summarized in this report. Although this report assesses the costs and benefits of different wastewater treatment strategies, the report does not provide specific recommendations on the most appropriate treatment strategies for small communities in Manitoba. There are other considerations that may help guide decision makers such as operator availability and process control.1 Notwithstanding these issues, this study provides an important first step toward a greater understanding of the full spectrum of values affected by wastewater treatment strategies for small communities across Manitoba and can help inform wastewater policies throughout the world.