ACHIEVING SUSTAINABLE WASTEWATER TREATMENT THROUGH THE APPLICATION OF LIFE CYCLE MANAGEMENT

Steve Tarallo*, Marco Menendez**

* **

Black & Veatch, Gaithersburg, Maryland Black & Veatch, Raleigh, North Carolina

ABSTRACT
Sustainability in the sphere of wastewater treatment encourages the planning, design, operation, maintenance, and management of wastewater infrastructure in a way that reduces use of non-renewable resources, minimizes overall environmental impact, and is economically and socially responsible. Achieving these lofty sustainability goals is much more easily said than done. Wastewater utility managers are often forced to make significant trade-offs due to budget constraints, technology limitations, regulatory uncertainty, political uncertainty, cost uncertainty, stakeholder concerns, and other factors. An additional limitation may also be the lack of robust planning and management frameworks, tools, and resources to help wastewater utility personnel better assess the inevitable trade-offs, minimize unintended consequences, better manage risk and uncertainty, and generally make more informed sustainability-related decisions. Life cycle management (LCM) is an applied sustainability approach that can be viewed as a management process similar to quality management or asset management. Conceived and promoted by United Nations Environmental Programme (UNEP), Society of Environmental Toxicology and Chemistry since early this decade, LCM and its related tools are gaining acceptance by an increasing number of businesses, non-profit organizations, and government agencies worldwide, including the US Environmental Protection Agency (US EPA). Wastewater utility managers have faced various difficult and complex challenges for many years. The relatively recent sustainability movement within the wastewater industry provides a special opportunity for utility managers to reexamine the way their utilities are managed and to implement new methods to help them become more flexible, proactive, and high-performance organizations. As wastewater utilities increasingly embrace the principles and concepts of sustainability, begin to define what sustainability means to their respective organizations, and think more deeply about how to realistically achieve sustainability goals, LCM could serve as the foundation upon which high-performance and sustainable wastewater utilities are managed.

KEYWORDS: Sustainability; Life Cycle Management; Triple Bottom Line; wastewater treatment; utility management; life cycle cost analysis; life cycle assessment; stakeholder participation INTRODUCTION
Municipal wastewater utility managers have faced various difficult and complex challenges for many years. Some of the more recent and significant issues utilities are dealing with include Making difficult decisions on capital improvement projects and staffing in tough economic times Dealing with the wide variety of biosolids treatment technology and disposal options within the context of increasing public health concerns, reduced availability of land application sites, and rising disposal costs Increasingly stringent permit limits and nutrient TMDLs. Water resource scarcity concerns and decisions to implement costly water reuse technologies and programs Rising energy costs and decisions to implement costly energy-related capital projects with long payback periods. Risk and uncertainty related to budget constraints, costs, technology limitations, regulations, policy issues, and stakeholder concerns As wastewater utilities grapple with these issues that have a direct impact on the organization, there has been increasing awareness, understanding, and acceptance by many utilities that their decisions and actions can have significant and lasting impacts beyond the boundaries of their respective service areas. This change in mindset has

been largely due to the sustainability movement that has surged within the wastewater industry only within the past 5 years. What is Sustainability? The Brundtland Commission has defined sustainable development as development that meets the needs of the present without compromising the ability of future generations to meet their own needs. (WCED, 1987) Sustainability has also been framed in terms of three Triple Bottom Line (TBL) dimensions: economic, environmental, and social, where sustainable decisions and actions are those that recognize the linkages of these three dimensions and have been proactively conceived to minimize the negative impacts across them. At its core, sustainability is about approaching issues more holistically. It requires thinking about the wide-reaching and long-term impacts of decisions. According to Wikipedia, myopia is the metaphorical term for cognitive thinking and decision making that is narrow-sighted or lacking in concern for wider interests or longer-term consequences. Decisions and actions based on sustainability principles are antithetical to myopia. The sustainability movement within the wastewater industry provides a special opportunity for utility managers to reexamine the way their utilities are managed and to implement new methods to help them become more flexible, proactive, and high-performance organizations. The management frameworks, analytical techniques, and tools that have been developed to improve TBL performance in organizations across a wide spectrum of industries can be applied in the municipal wastewater industry, albeit with a profound respect for and understanding of the industrys and each utilitys unique characteristics. Life Cycle Management (LCM) is one approach that a number of organizations in other industries are applying to achieve sustainability (UNEP/SETAC, 2004a). This paper proposes the application of LCM in the municipal wastewater industry. The paper introduces fundamental LCM principles and provides an overview of several useful tools and analytical techniques that, when applied in an integrated and systematic manner through LCM, could provide wastewater utilities with a true path to sustainability and improved TBL performance.

METHODOLOGY
Life Cycle Thinking One way to avoid myopia and to address issues more holistically is to use a life cycle approach. A life cycle approach is a way of thinking which helps us recognize how our decisions and actions are one part of a whole system of events. Life cycle thinking creates awareness of the system-wide impact of decisions and helps avoid shifting problems in space and/or time (UNEP/SETAC, 2004b). This approach can also be described as managing from cradle to grave. Life cycles illustrate the interrelationships of systems. For example, a products life cycle encompasses the extraction of raw materials and the use of these resources for the production of energy and other inputs into the manufacture, distribution, use, reuse/recycling, and final disposal of the product. Economic, environmental, and social impacts occur at each stage of the products life cycle, not simply at the point at which we as product users are directly exposed. Consider methanol for wastewater denitrification. Methanol is a widely used and effective supplemental carbon source for wastewater denitrification and has helped many wastewater utilities meet increasingly stringent effluent total nitrogen limits, thus protecting the receiving stream and watershed. However, when one understands through life cycle thinking where methanol is typically sourced, that it is produced from natural gas, and requires a significant amount of energy and other resources for production and distribution, the environmental, economic, and social trade-offs become more apparent and can be used to compare the life cycle impacts of other alternative carbon sources. Inter-temporal choice: Inter-temporal choice is a key aspect of life cycle thinking. Inter-temporal choice is the study of the relative value people assign to two or more payoffs at different points in time. The hypothetical examples depicted in Figures 1 and 2 below illustrate this concept. Figure 1 shows the comparison of two hypothetical water resources planning options. In this hypothetical example, current frequency of water restrictions is already high at 25% of the time. Two water resource planning options

have been determined through prior alternatives analyses to be the most desirable based on a variety of criteria. Option 1 uses new technologies and methods that require some additional studies, pilot and demonstration programs, and a longer time to implement at full scale than Option 2, which applies more traditional methods that can be implemented immediately. As shown in Figure 1, short, medium, and long term projections of water restriction frequency are quite different for the two options, but Option 2 clearly has more immediate benefits whereas Option 1 is better in the long term.
Frequency of water restrictions (% of time)

50%

Option 1 projections

Option 2 projections 25%

2010

2035 Year

2050

Figure 1 Hypothetical example of inter-temporal choice Figure 2 shows the comparison of two hypothetical utility master plan options. In this hypothetical example, option 2 provides affordable (total annual cost approximately 2% of median household income (MHI)) throughout the time period evaluated. However, Option 1 is projected to be significantly more affordable to customers over the longterm, but comes at a premium in the short and medium terms.

4%
Total Annual Cost as % of MHI

Option 1 projections

2%

Option 2 projections

2010

2035

2050

Figure 2 Hypothetical example of inter-temporal choice Which option would you choose in each of these examples? There is no correct or incorrect answer to this question. What is important is the application of life cycle thinking to the issues and the means by which the decision is made.

In the field of economics, the Discounted Utility Model is the traditional model used to describe how inter-temporal trade-offs between current and future benefits ought to be made. The Discounted Utility Model states that rewards should be devalued (discounted) for a fixed proportion of their utility for every time interval that they are to be delayed and that this devaluation should be closely related to the market interest rate. For projects in which benefits or costs occur well into the future, the discount rate used for the analysis will have a strong impact on the results. The higher the discount rate applied in the analysis, the lower the concern for future generations. The value of the social discount rate, such as what would be applied using the Discounted Utility Model for the examples above, has been a controversy for decades (Short, Packey, and Holt, 1995). Inter-spatial choice: Another key aspect of life cycle thinking is inter-spatial choice. Inter-spatial choice is the study of the relative value people assign to two or more payoffs at different points in space. A recent high-profile issue to which inter-spatial choice is fundamental is global climate change. Assume a utility is evaluating two process options for upgrading and expanding its wastewater treatment plant. Process option 1 is energy-intensive, but produces an effluent with very low BOD, TSS, and total nitrogen concentrations, all less than 5 mg/L. Process option 2 uses significantly less energy and produces a lower-quality effluent, with BOD, TSS, and total nitrogen concentrations of 25 mg/L, 30 mg/L, and 15 mg/L, respectively. The carbon footprint of process option 1 is approximately four times that of process option 2. Both process options meet current and anticipated future discharge permit limits and their life cycle costs are roughly the same. Which option would you choose? Whether one believes global warming is happening and is caused by human actions or not is only a single factor in the decision and, unless the organization is an autocracy, there will likely be a variety of different stakeholder opinions on the subject. As is the case with inter-temporal choice, what is important for decision-makers is to understand and appreciate the uncertainties and risks of climate change and to respect the opinions of all stakeholders on the subject. To advance this concept of inter-spatial choice further, it is important to note that global climate change and local watershed degradation are only two environmental impacts. A true life cycle approach would consider a whole host of other direct and indirect environmental impacts, as in the methanol example described earlier in this paper, and in the description of Life Cycle Assessment (LCA) below. Uncertainty and risk: There are potential economic, environmental, and social impacts, both positive and negative, for each of the options described in all four of the examples above. Because the life cycle approach deals with long time horizons, wide geographic areas, and complex system interrelationships, influencing factors and projections are subject to a great deal of uncertainty and various levels of risk. Sound decisions based on life cycle thinking require that uncertainties and risks be addressed appropriately using proven techniques. Uncertainty is the existence of more than one possibility, when the true outcome, state, result, or value is unknown, and is described in terms of probability distributions (Hubbard, 2009a). For example, instead of a deterministic projection (single value estimate) of 15% increase in energy prices next year, a probabilistic analysis might conclude that there is a 60% chance that energy prices will rise by more that 10% next year and a 40% chance that they will decrease or stay the same. A probability distribution is the single most important form for presenting uncertain information and provides much more useful information to decision makers than a single value estimate (i.e. average value), particularly when assessing risk (Savage, 2009a). Risk is the state of uncertainty where something negative could result (Hubbard, 2009b). For example, a risk assessment might conclude that there is a 10% chance that the projected rise in energy prices will cause the utility to increase customer rates above acceptable levels. The relationship of a specified risk to the uncertainties and variability in project factors can be assessed using a combination of analytical techniques, such as sensitivity analysis, scenario analysis, and Monte Carlo simulation. There has been significant advancement of uncertainty and risk assessment techniques in recent years and there are a wide variety of software tools available (Rahman and Vanier, 2004a; Savage, 2009b) that can help municipal wastewater utilities make more informed decisions in uncertain environments. Stakeholder participation: Stakeholders perceive benefits and risks of decisions differently. They also have various levels of awareness and understanding of the specific issues involved. Since sustainable solutions involve acknowledgment of the social dimension, sustainability assessments and decisions would typically include the input

of stakeholders external to the utility, such as regulators, customers, community leaders, local businesses, and public interest groups. Effectively soliciting the opinions of a group with such diversity in values, opinions, interests, preferences, and knowledge of the matters at hand, and resolving the inevitable trade-offs, requires an active, consistent, and well-planned stakeholder participation process. Keys to the stakeholder participation process are how information is presented (i.e. acknowledgement of uncertainty and estimation of risks) and the use of tools to provide information to and resolve trade-offs among the stakeholders. What is Life Cycle Management? As discussed above, the path to sustainability for municipal wastewater utilities starts with life cycle thinking. In order for a utility to implement life cycle thinking and stay on track towards becoming a sustainable organization, the utility must put in place appropriately designed management processes and support systems. Life cycle management is such an applied sustainability approach. It can be viewed as a management process similar to quality management (or asset management, but is overarching and significantly broader in scope. LCM has been defined as an integrated framework of concepts and techniques to address environmental, economic, technological, and social aspects of products, services, and organizations. UNEP defines LCM as an integrated concept to manage products and services towards more sustainable production and consumption patterns. (UNEP/SETAC, 2004c) Others have described LCM as a strategic paradigm that provides the opportunity to lower costs; improve risk management; improve public relations and communications; and ultimately make more informed and sound decisions. Implementing LCM will impact the following five key areas of wastewater utility management: Strategic planning the strategic planning process is driven by sustainability principles and improved TBL performance. Organizational change management life cycle thinking must pervade the utilitys entire organization. Risk management/decision support systems must be congruent with life cycle thinking and expanded participation of stakeholders. Stakeholder relations stakeholder participation will be more inclusive and collaborative. Analytical tools and techniques a new set of analytical tools and techniques will be needed. These economic, environmental, and social impact assessment and decision support methods must be designed to consider longer time horizons, wider geographic scales, system component interrelationships, uncertainty, and risk.

RESULTS
The UNEP/SETAC Life Cycle Initiative In 2002, the United Nations Environmental Progamme (UNEP) partnered with the Society of Environmental Toxicology and Chemistry (SETAC) to launch the Life Cycle Initiative, an international partnership to put life cycle thinking into practice. The Life Cycle Initiative was conceived in response to calls from governments for a framework of programs to promote sustainable development. (UNEP/SETAC, 2004d) The World Business Council for Sustainable Development (WBCSD) has recently joined UNEP/SETAC in actively promoting life cycle management. An increasing number of governments and prominent global businesses are using life cycle management methods and tools in current operations and future planning activities. Sponsors of the Life Cycle Initiative have included: Johnson & Johnson, ABB, General Motors, CIRAIG/Government of Canada and Quebec, American Plastics Council, Rio Tinto Alcan, Veolia Environnement, and U.S. Environmental Protection Agency, among others. One of the objectives of the WBCSD-UNEP/SETAC Life Cycle Initiative is to develop a LCM framework of different tools and concepts. There has been increasing development of sustainability assessment tools over the past two decades. Three of the more commonly applied tools and methods are Life Cycle Assessment (LCA) Life Cycle Cost Analysis (LCCA) Multi-Criteria Decision Analysis (MCDA)

Life Cycle Assessment

Life Cycle Assessment is a holistic and systematic method for analyzing the environmental and human health impacts of a product or process across its life cycle. (NREL, 2009a) The International Standards Organization (ISO) developed a standardized technical framework for the LCA methodology in its ISO 14040 series. ISO 14040 covers LCAs principles and frameworks; ISO 14044 covers its requirements and guidelines. LCA enables the estimation of the cumulative environmental impacts resulting from all stages of the life cycle, often including impacts not considered in more traditional analyses. By including life cycle impacts, LCA provides a more comprehensive view of the environmental aspects of the product, service, or process (Haas, Foley, and Barr, 2008) and a more accurate picture of the true environmental trade-offs in technology or process selection. Though relatively few LCA studies have been conducted in the wastewater industry relative to the field of product manufacturing, the number has been increasing in recent years. Following is a partial list of published LCA studies conducted in the wastewater treatment industry: Foley, J.; de Haas, D.W.; Hartley, K.J.; Lant, P. (2007) The Global Environmental Burden of Leading Edge BNR Technology Moving Beyond the Optimum. Paper presented at 4th IWA Leading-edge Conference & Exhibition on Water and Wastewater Technologies,Singapore, 3-6 June 2007 Wenzel, H.; Larsen, H.F; Clauson-Kaas, J.; Hobiye, L.; Jacobsen, B.N. (2008) Weighing environmental advantages and disadvantages of advanced wastewater treatment of micro-pollutants using environmental life cycle assessment. Water Science and Technology Gaterell, M.R.; Griffin, P.; Lester, J.N. (2005) Evaluation of Environmental Burdens Associated with Sewage Treatment Processes using Life Cycle Assessment Techniques. Environmental Technology, 26, 231-249 Peters, G.M.; Rowley, H.V. (2008) Biosolids: An Environmental Life Cycle Assessment. Water Conducting an LCA requires detailed inventory data for the life cycles of each technology considered in the comparison. It is data-intensive and can be technically complex. However, there are a number of software programs on the market that are designed to facilitate collection, access, and use of inventory data and for calculating life cycle impacts in accordance with ISO 14040 standards. Much of the data in these software programs is European-based. However, the U.S. Department of Energy National Renewable Energy Laboratory (NREL) is leading an initiative to improve the existing U.S. Life Cycle Inventory Database (U.S. LCI Database). NRELs vision statement for the U.S. LCI Database is for it to be the recognized source of U.S.-based, quality, transparent life cycle inventory data and an integral part of the rapidly expanding use of life cycle assessment as an essential environmental analysis and decision-making tool. (NREL, 2009b) It is clear from the direction of global and U.S.based government initiatives and the growth of LCA software and consulting firms that LCA is becoming an essential method for conducting environmental assessments. Life Cycle Cost Analysis Life Cycle Cost Analysis (LCCA) is a process for evaluating the total economic cost of an asset by analyzing initial costs and discounted future expenditures over the life cycle of the asset (Rahman and Vanier 2004b). Life Cycle cost should include all costs associated with the planning, development, acquisition, operation, maintenance, major repair/replacement, administration, and disposal of an asset. LCCA is used to evaluate differences in costs and the timing of costs between alternative projects. All significant costs are considered over the life of the project and then these costs are discounted to the base year. The formula for calculating a Life Cycle Cost Estimate (LCCE) is as follows
N

LCCE = Cn / (1+d)n
n=0

Where: LCC = present value of the life cycle costs Cn = cost in period n N = analysis period in years d = annual discount rate

Life cycle costing has been applied in the wastewater treatment industry for many years. The key differences in its application as part of a LCM/sustainability framework are The inclusion of more indirect (i.e., legal and administration, future and contingent liability, community relations, etc.) and intangible costs (i.e., social costs, externalities). Many of these costs are typically more difficult to measure than capital and O&M costs included in traditional present worth analyses. Increased use of probabilistic approaches, where uncertain costs and variables are modeled using probability distributions to illustrate the likelihood that the LCCE lays within a specific range. As noted earlier, a probability distribution provides much more useful information to decision makers than a single value estimate. Multi-Criteria Decision Analysis Multi-Criteria Decision Analysis (MCDA) tools utilize structured, quantitative methods to produce a ranking of alternatives based on a set of decision criteria. MCDA tools facilitate decision-making when there are diverse opinions, values, and interests expressed from a variety of stakeholders. MCDA can enhance communication by formalizing intuitive judgments about what is important in a particular decision context by a particular stakeholder. It is important when conducting MCDA that the issue under consideration be structured correctly and well defined. The first step in an MCDA is to collect and analyze all the available information. The second step includes definition of the decision issue objectives and the evaluation criteria. Step 3 involves the quantification, normalization, and weighting of the evaluation criteria by the participants. Each alternative under evaluation is scored by calculating the product of each normalized criterion and its corresponding weight. The alternative with the highest score is the one that satisfies the evaluation criteria to the highest degree. Sensitivity analyses are often carried out to determine the effect on the model output by changes in input parameters, such as relative weights applied to the criteria. Sensitivity analyses may be made to investigate the significance of uncertain or missing information or to assess the effect of a stakeholders uncertainty about his values or priorities.

DISCUSSION
LCA, LCCA, and MCDA are just three of many methods that could be applied to address the significant and complex issues facing municipal wastewater utilities. Each method addresses at least one of the three pillars of sustainability and is congruent with life cycle thinking. LCA addresses environmental impact issues from a cradle to grave, systems engineering perspective. LCCA provides an economic assessment that is more holistic and accounts for indirect and intangible costs that are more difficult to measure, but nonetheless could have a significant impact on economic decisions, particularly those that involve long time periods, relatively high operations/use costs, and uncertain service lives. MCDA acknowledges and respects the different opinions and values of diverse stakeholders in important issues involving inter-temporal and inter-spatial choice. These tools are of reduced value when used in isolation. A key issue for sustainability planning and management is how to integrate the three TBL factors in the process of making decisions. A well designed LCM framework would systematically integrate these three pillars of sustainability economic, environmental, and social into a utilitys planning and daily management activities, with life cycle thinking serving as the foundational principle. However one defines LCM, the specific means, methods, systems, and tools that constitute a wastewater utilitys sustainability approach must be tailor-made for that utility. A profound understanding of the utilitys organization, stakeholders, systems, facilities, existing strategic plans, and current TBL performance, combined with insightful knowledge of issues and trends that could realistically affect the utilitys TBL performance, is critical for designing an effective and flexible LCM framework. Once a wastewater utility has made a commitment to sustainability and articulated its vision, the utilitys path to sustainability would, in its broadest sense, comprise four steps Step 1 Institute and support life cycle thinking throughout the organization Step 2 Conceive and implement a robust and flexible Life Cycle Management framework, including all related tools, methods, and resources Step 3 Continuously monitor TBL performance at a utility-wide level and in major activities (master

planning, capital improvements planning, design and construction management, program management, operations and maintenance) Step 4 Continuous improvement As with any major organizational change initiative, implementing this four-step path to sustainability will require commitment, persistence, patience, and strong leadership.

CONCLUSION
True advancement towards sustainability demands much more than developing a greenhouse gas emissions reduction action plan, conducting a few sustainability benchmarking exercises, or fragmented implementation of sustainable design or construction practices. It requires an organizational commitment to holistic thinking through the life cycle approach address uncertainty and risk directly with proven, effective methods broaden and deepen stakeholder participation make more informed and sound decisions through integration of the three TBL dimensions: economic, environmental, and social. By bringing these four commitments under a custom designed and flexible Life Cycle Management framework, municipal wastewater utility managers can effectively institute and execute the means and methods needed to make their utilities high-performance and truly sustainable organizations.

REFERENCES
Hubbard, D.W. (2009) The Failure of Risk Management: Why its Broken and How to Fix it; John Wiley & Sons, Inc.; Hoboken, NJ NREL (2009) U.S. Life Cycle Inventory Database Roadmap. Rahman, S.; Vanier, D.J. (2004) Life cycle cost analysis as a decision support tool for managing municipal infrastructure; Proceedings of the CIB 2004 Triennial Congress; Toronto, Ontario; May 2-9, 2004; pp. 1-12; International Council for Research and Innovation in Building and Construction; Rotterdam, The Netherlands Savage, S.L. (2009) The Flaw of Averages: Why we Underestimate Risk in the Face of Uncertainty; John Wiley & Sons, Inc.; Hoboken, NJ Short, W; Packey, D.J.; Holt, T. (1995) A Manual for the Economic Evaluation of Energy Efficiency and Renewable Energy Technologies; NREL/TP-462-5173; National Renewable Energy Laboratory; Golden CO UNEP (2004) Why Take A Life Cycle Approach. Life Cycle Initiative Brochure; ISBN-92-807-24500-9; United Nations; New York, NY WCED (1987) Our Common Future. UN Conference for Environment and Development www.lciinitiative.unep.fr