New Delhi: In a recent interview, Guillaume Dourdin, India CEO of global water management leader Veolia, revealed that the operational costs associated with drinking water and wastewater treatment plants have surged significantly, primarily due to escalating energy prices.
The French multinational has been actively collaborating with local authorities to enhance the water distribution infrastructure across various regions, including New Delhi, Maharashtra, Karnataka, and Greater Mohali, aiming for improved water delivery and quality for residents.
Dourdin further disclosed that Veolia is in the process of initiating projects focused on the reuse of industrial water in states such as Gujarat, Maharashtra, and Rajasthan, signaling a commitment to sustainable water management practices.
“We are directly impacted by the cost of energy in our hazardous waste activities. So, whenever the energy jumps by 10%, we take a hit of 10% in our PNA (Partial nitritation-anammox),” Dourdin explained. “Finding ways to offset these costs is challenging, as it is difficult to fully transfer this burden onto our customers. While we manage to pass some of this inflation on, we cannot fully absorb these costs ourselves.”
“The energy requirement is very different from one project to another,” Dourdin noted. “Whether it’s a drinking water plant, wastewater treatment facility, or an incineration line for hazardous waste, the energy consumption figures are extremely varied.”
“Our nine water treatment plants (WTPs) collectively consume an average of 78,402 MWh annually to produce an impressive 338 million cubic meters of water. Factors such as plant location, terrain, the quality of raw water, seasonal variations, the age of the facilities, and inflow and outflow metrics all play a critical role in this energy consumption,” he added.
This development occurs amidst a backdrop of soaring energy costs. According to a July report from the International Energy Agency, global electricity demand is experiencing its fastest rise in years, propelled by robust economic growth, severe heatwaves, and a surge in electricity-dependent technologies such as electric vehicles and heat pumps.
Global electricity consumption is anticipated to increase by approximately 4% in 2024, a significant jump from the 2.5% growth rate recorded in 2023. The trend of heightened electricity demand is expected to persist into 2025, with further growth estimates around 4%. In India, demand is forecast to skyrocket by a substantial 8% this year, driven by vigorous economic activities and potent heatwaves, indicating a substantial impact on the energy landscape.
India’s electricity demand is set to grow at an impressive rate of over 4% annually until 2050, surpassing the global average growth projections for the same timeframe, as reported by the IEA in October. Meanwhile, wholesale electricity prices in India saw a notable increase of 12.2% in September, reflecting the ongoing energy challenges as the country navigates its growing demands.
Dourdin confirmed that following the signing of a contract for a water treatment plant with a capacity of 2,000 million litres per day in Mumbai, Veolia is now exploring several reuse projects for industrial water, which are projected to cost several dozen million euros.
Reuse projects
“We are actively pursuing reuse projects for industrial water in neighboring states, particularly Maharashtra and Rajasthan, reflecting our strategic focus on development and sustainability,” stated Dourdin. “The typical investment for these initiatives can range from a few million euros for smaller carbon capture plants to several dozen million euros for larger sub-water facilities. However, in many of our business models, we don’t always shoulder the full financial burden.”
As the 29th Conference of the Parties to the United Nations Framework Convention on Climate Change, or COP29, approaches, Dourdin emphasized the critical importance of water reuse and appropriate water pricing in achieving long-term water security.
The COP29 presidency revealed a package of 14 initiatives aimed at enhancing climate action last month. This includes a pivotal declaration on water for climate action, which the COP29 Presidency, in collaboration with the United Nations Environment Programme, the United Nations Economic Commission for Europe, and the World Meteorological Organization, will use to launch the Baku Dialogue on Water for Climate Action, scheduled for November 21. This initiative aims to strengthen continuity and coherence in climate discussions from COP to COP.
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**Interview with Guillaume Dourdin, CEO of Veolia India**
**Editor:** Thank you for joining us, Mr. Dourdin. Given the recent surge in operational costs for drinking water and wastewater treatment, can you elaborate on how energy prices have impacted your operations?
**Dourdin:** Thank you for having me. The rise in energy costs has been significant for us. For instance, every 10% increase in energy prices directly translates to a 10% impact on our Partial Nitritation-Anammox (PNA) processes. This challenge in offsetting costs is considerable, as while we can pass some of the inflation onto our customers, we can’t fully transfer this burden.
**Editor:** That’s quite concerning. How are you responding to these challenges, particularly with your current projects?
**Dourdin:** We are actively collaborating with local authorities to enhance water distribution infrastructure in regions like New Delhi, Maharashtra, and Karnataka. Moreover, we are focusing on innovative projects that promote the reuse of industrial water, particularly in states such as Gujarat, Maharashtra, and Rajasthan. This is a critical aspect of our commitment to sustainable water management.
**Editor:** You mentioned that energy consumption varies significantly across projects. Can you shed some light on this?
**Dourdin:** Absolutely. The energy needs fluctuate based on several factors including the type of facility—whether it’s a drinking water plant or wastewater treatment facility—as well as external factors like plant location, the quality of raw water, seasonal changes, and the age of the facilities. For instance, our nine water treatment plants collectively use about 78,402 MWh annually, producing approximately 338 million cubic meters of water.
**Editor:** The global energy landscape is shifting, with reports predicting increased electricity demand. How do you see this affecting Veolia’s operations in India?
**Dourdin:** The trends are indeed concerning. India is set to experience a substantial 8% growth in electricity demand this year alone, driven by economic growth and severe heatwaves. This heightened demand, coupled with the recent jump in wholesale electricity prices, will undoubtedly affect our operational costs moving forward. As we navigate these challenges, it’s essential to adapt and innovate new solutions in our water management practices.
**Editor:** Thank you, Mr. Dourdin. Your insights into the current state of water management and energy consumption challenges are invaluable. We wish you and Veolia continued success in your initiatives.
**Dourdin:** Thank you for the opportunity to share this important information.
