Accounting for Industrial Effluent and Water Quality


Summary of Accounting Approaches for Water Quality and Industrial Effluent-Related Impacts

Though water quantity receives much of the focus in the context of corporate water management practices and accounting, water quality is equally important to businesses both in terms of risk and impacts. Untreated or insufficiently treated water can lead to increased incidence of disease, damaged ecosystems, and the inability of the company and other users to use such water. Thus, companies have just as great a stake in accounting for—and addressing —their risk and impacts associated with water quality as they do for water quantity issues.

As discussed, accounting for water use/ quantity can be quite complex and requires meshing a number of different factors in order to be credible and meaningful. That said, accounting for industrial effluent and related impacts on water resources is arguably even more complex and problematic. This complexity is due to many factors, including the various different types of pollutants coming from industrial facilities and agriculture (e.g., phosphates, nitrates, mercury, lead, oils, sulfur, petrochemicals, undiluted corrosives, and hard metals, just to name a few); the interactions among pollutants; the variety of ways water quality can be compromised (i.e., contaminant loads, temperature, odor, turbidity), and the various approaches to accounting for the resulting impacts to ecosystems and communities.

Measurable water quality characteristics can be grouped into three broad categories:

  • Physical characteristics (e.g., temperature, turbidity/light penetration, and flow velocity),
  • Chemical characteristics (e.g., pH, salinity, dissolved oxygen, nitrate, phosphate, biological oxygen demand [BOD], toxics, chemical oxygen demand [COD]); and
  • Biological characteristics (e.g. abundance of coliform bacteria, zooplankton, and other organisms that serve as an indicator of ecosystem health).

Companies aiming to account for their water pollution and its effects on water quality must determine a range of factors including the volume of wastewater they discharge, the types and loads of pollutants within that wastewater, the short- and long-term effects of those pollutants on receiving waterways, and the impacts of those changes on human health, human access to safe water, and ecosystem function.

Click each box to learn more about each method’s approach to water quality
Definition and Objectives
Water footprints deal with industrial effluents and water quality exclusively within the “gray water” component. The gray WF is calculated as the volume of water that is required to dilute pollutants to such an extent that the quality of the water remains above agreed water quality standards. Whether this water is discharged back to surface or groundwater, it is considered “used” because it is unavailable for human use due to the fact that it is functioning in-stream as a dilution medium. For this reason, the gray WF is a theoretical volume, rather than a real volume as compared to the blue and green WF.

The methodology for determining the gray WF is perhaps the least developed of the three WF components. In fact, many corporate WF studies to date do not include a gray water component. Those that do include gray water have done so in different ways. However, they all utilize some permutation of the same basic equation that uses one water quality regulatory standard to calculate how much water is needed to dilute pollution to acceptable levels. Because companies almost always release more than one pollutant (and typically dozens) to waterways, the methodology requires the company to select the pollutant with the highest required dilution volume. In theory, this dilution volume will then be sufficient for all other pollutants discharged. This method also requires the company to identify the most appropriate regulatory standard for the relevant pollutant and location of the discharge.

At the time of this writing, the authors were unaware of if and how the WF Decision Support System would address the gray WF on a watershed basis.

While the concept of accounting for industrial effluents and water quality was unanimously considered important, companies familiar with the WF methodology have significant concerns (both conceptual and practical) with the gray water component its current form. Many felt that approaching water quality accounting through the assessment of dilution water volume has some fundamental disadvantages/limitations. The most notable of these limitations are the obscuring of contaminant load data and the base referencing of local water quality standards.

Specifically, focusing on the contaminant with the highest dilution water requirementis deemed a questionable approach, because in reality, industrial effluent typically contains a number of different types of contaminants, all of which have different implications, time constants and impacts for the surrounding environment. Further, a dilution approach cannot account for potential additive, synergistic, and long-term effects of the various types of persistent, bio-accumulating pollutants that may be discharged by a company.

Linking dilution water requirements to water quality standards is also problematic because these standards vary from watershed to watershed and in many localities do not exist (or are not available) at all. Not only does this mean that the required dilution volumes are dependent on political factors rather than scientific determinations, but this requirement adds additional complexity to the system, prompting questions such as:

  • Which standard does a company use (e.g., national regulations, recommendations from intergovernmental organizations)?
  • What do companies do in the absence of national standards or if national standards do not mitigate pollution to a level that protects communities and ecosystems?
  • Does such an approach lead to an accounting bias in favor of countries with less stringent water quality standards, and/or incentivize companies to favor/give preference to operations in such countries?

Lastly, the dilution approach is deemed a circuitous route to addressing industrial effluents. Rather than directly accounting for the initial corporate water use/discharge, the gray WF focuses on a theoretical corporate response, which may or may not occur. In doing so, dilution—rather than prevention—is implicitly promoted as the desired solution to industrial effluent. Many consider pollution prevention to be highly preferable to dilution due to the fact that many pollutants persist and bioaccumulate and impacts occur even when dilution volume is considered adequate to meet regulatory standards. Furthermore, this approach obscures and de-emphasizes important information about the type and amount of pollutants released to waterways, as well as potential ways to reduce these pollutants. Finally, the WF gray water accounting method does not address water pollution transported to waterways through air pollution, the predominant source of water pollution in many industrialized nations.

In the gray water approach, the WF’s typical inclination toward real numbers that require little human subjective assessment is replaced by a methodology that requires highly variable and subjective standards. Because of these fundamental differences between the gray water component (a theoretical volume characterized based on water quality standards) and the green and blue water footprints (real volumetric measures), the handful of companies surveyed for this analysis indicated that aggregating the gray component along with the green and blue components is misleading and of little use.

In the context of water pollution, LCA methods are already well-developed and widely accepted. They are aimed at a number of different environmental impact categories independent of whether the emissions occur to water or to some other medium. The most common impacts associated with water quality in LCA are:

  • Eutrophication (overgrowth of algae due to excess nutrient addition)
  • Acidification due to emissions of acidifying substances (mostly into the air)
  • Ecotoxicity (potential for biological, chemical or physical stressors to affect ecosystems)
  • Human toxicity

These impact categories are measured in terms of equivalents of eutrophication potential (phosphorus or nitrogen units); acidification potential (hydrogen ion or sulfur dioxide units); and ecotoxicity potential (cubic meter-years). Because these units are not the same, these impacts cannot be added up without a value judgment for normalization and weighting of the impacts, for example as is done for eco-indicator points or end-point indicators.

There is research going back to the 1990s that evaluates ecotoxicity potential with impact units of cubic meter years, adding up the impacts of the many different toxic substances. These analyses are based on a so-called “unit earth” or fugacity standardized fate and transport model for toxic pollutants (regardless of their medium). Information on the ecotoxicity of the individual pollutants and their persistence in different environmental compartments must be known or estimated. This kind of model is the most closely related to the Water Footprint Network’s gray water.

It is possible to report loads of pollutants to waterways through the simple addition of the mass of emissions to water, but this is not practiced within the LCA field because there is no way to describe the environmental mechanism to support the calculation. In effect, such a calculation would be saying that there is no science behind the analysis.

The use of these life cycle impact models and reporting on the product basis supports all the basic purposes of LCA (decisions for engineering, policy, and purchase and sales) as described above. It helps businesses understand the risks of different environmental effects for processes within the control of the business and also for those outside the direct control of a business. Of particular interest are the impacts of a product downstream (the use and recycle/disposal phases). Although manufacturers do not control the actions of their customers, in the case where a manufacturer designs a product with the use and disposal phases in mind, these phases can be shown to have fewer polluting impacts.

LCA is limited to the impacts for which there is good enough science to perform impact assessment. LCA is a relative method, normalized to the functional unit defined in the study. It is not typically applied to a whole ecosystem or whole watershed analysis, and therefore is seldom used by water resource managers. On the other hand, the broad application to the entire life cycle of the product
allows managers to understand where it is possible to manage or influence the product’s overall outcome.

The WBCSD Global Water Tool does not measure or otherwise assess water quality or industrial effluent.

The GEMI Water Sustainability Tool encourages companies to analyze their pollution to water bodies (which they perhaps confusingly refer to as “water impacts”). It does not provide any method or guidance for the measurement of industrial effluents or quantification of impacts to water quality. It looks at both pollution caused by a company’s direct discharges to the environment as well as more indirect avenues of pollution such as air deposition and the leaching of chemicals. It provides a series of questions (categorized by value chain stage) that help companies better understand their effects on the pollution of water bodies.

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