The price of reclaimed water must be lower than that of potable water to induce purchase of the reclaimed water because of additional internal costs to the user. An internal dual water distribution system must be installed to keep potable and reclaimed water separate for health, product, and process purposes. In the absence of legislative fiat, the selection or rejection of reclaimed water by customers is based on relative price and costs associated with use. User costs can be reduced by offering grants to pay for installation of the necessary infrastructure. Raising the relative price of potable water to large users, especially turf users, would encourage substitution of reclaimed water.
Most cities sell their reclaimed water at a loss.
As sales increase, these losses will be reduced or eliminated by economies of scale in treatment and delivery systems. Currently, most reclaimed water is sold to public schools, golf courses, and parks. Cities should intensify their marketing efforts to industrial, agricultural, and commercial users. In some cases, legislation is needed to alter grandfathered water rights that make pumping of groundwater cheaper than reclaimed water in these markets. There are clear economic benefits to the use of reclaimed water in the avoidance of groundwater depletion and the development of expensive new surface or groundwater supplies.