To combat urban water stress and foster a circular economy, the Odisha government has introduced a landmark policy to ensure 100 per cent treatment of used water by 2030 and scale up its reuse across municipal, industrial, and agricultural sectors by 2036.

In a decisive move toward ensuring long-term water sustainability and advancing a circular economy in urban development, the Government of Odisha has officially notified the “Policy on Reuse of Treated Used Water (TUW) of Urban Odisha, 2026.”

Introduced by the Housing and Urban Development (H&UD) Department, this comprehensive framework sets out an ambitious, time-bound roadmap designed to transform used water from a hazardous civic burden into a highly productive economic resource.

The policy arrives at a critical juncture as rapidly expanding urban centres across the state face growing seasonal and spatial water stress. With a clear vision aligned with the state’s centenary celebrations, the framework establishes binding targets for urban local bodies (ULBs). The primary objectives include achieving 100 per cent collection, conveyance, and treatment of used water across all ULBs by the year 2030. Concurrently, the state aims to ensure that at least 20 per cent of this treated water is actively reused by 2030, with a further, massive scale-up to a minimum of 50 per cent reuse by the year 2036 – a milestone year that coincides with “Vision Odisha 2036.”

Bridging the Gap Between Generation and Treatment

Currently, the urgency of this initiative is underlined by a stark gap in Odisha’s wastewater management capacity. As per recent government estimates, the state generates approximately 1,104 million litres per day (MLD) of used water. However, a mere 190 MLD currently undergoes adequate treatment, exposing a significant operational deficit. The untreated runoff places immense pressure on natural water bodies, inadvertently increasing the pollution load entering rivers, lakes, and open drains.

The newly introduced policy has been meticulously designed to bridge this substantial treatment gap. It mandates universal access to wastewater treatment systems and enforces strict compliance with prescribed quality and safety standards for non-potable reuse. To ensure immediate action, the policy dictates that in cities where sewerage systems and sewage treatment plants (STPs) are already fully operational, a minimum 20 per cent reuse of treated water must be achieved within six months of the official notification. For areas where infrastructure is still under development, these ambitious reuse targets will come into effect within six months of the project’s commissioning.

Diverse Sectoral Applications and Circular Economy

By recognizing treated wastewater as a valuable secondary water source rather than mere waste, the state government aims to alleviate the immense pressure on conventional freshwater sources. The policy actively promotes the widespread adoption of treated water across a diverse array of sectors, ensuring that high-grade potable water is reserved strictly for human consumption.

In the municipal and institutional segments, the use of treated water will be highly encouraged for everyday civic tasks. These include mechanized road cleaning, firefighting operations, public sanitation, gardening, park maintenance, and the operation of heating, ventilation, and air conditioning (HVAC) systems in large commercial establishments. Simultaneously, the industrial sector – a heavy consumer of freshwater – will be directed to utilize treated resources for power plant operations, cooling towers, boiler feed, construction activities, and general process water needs. For the agricultural and environmental sectors, the policy champions the use of treated used water for irrigation, large-scale wetland restoration, the rejuvenation of urban lakes, and the maintenance of essential green belts.

Innovative TUW Tariff Model and Incentives

To drive rapid adoption and make the transition economically viable, the Odisha government has introduced an innovative TUW Tariff Model. A core principle of this economic framework is ensuring that treated used water is consistently priced lower than standard potable water, creating an immediate financial incentive for large-scale consumers to make the switch.

Beyond competitive pricing, the state has rolled out a comprehensive package of financial incentives. Farmers opting to use treated water for irrigation will be eligible for specialized water credits. Industries making the shift will benefit from tariff rebates and Viability Gap Funding (VGF) support, which will help offset any initial infrastructural modifications required to intake TUW. Furthermore, residential societies that integrate treated water for localized landscaping and toilet flushing will be rewarded with utility rebates. To ensure sustained compliance across the board, the policy also outlines a system of performance-linked incentives and strict disincentives for those failing to meet the mandated reuse benchmarks.

Robust Governance and Infrastructure Rollout

Recognizing that an ambitious policy requires an equally strong administrative backbone, a robust, multi-tier governance mechanism has been established to oversee its implementation. At the apex level, a State High Powered Committee (SHPC) will provide overall policy direction, oversee inter-departmental coordination, and finalize pricing decisions.

This apex body will be thoroughly supported by a State Level Technical Committee (SLTC) and a dedicated Treated Used Water Cell, which will handle the day-to-day planning, continuous monitoring, and provide essential technical support. On the ground, District Coordination Committees (DCCs) will be formed to facilitate demand aggregation, forge local partnerships, and ensure smooth field-level execution. The Housing and Urban Development Department will strictly oversee all regulations and standards. Meanwhile, specialized agencies such as the Odisha Water Supply and Sewerage Board (OWSSB) will be entirely responsible for the rapid development and operation of the required physical infrastructure.

Future-Proofing Urban Odisha in Line with National Goals

Urban development experts and environmentalists have widely lauded the policy, noting that it will significantly reduce freshwater demand in heavily industrializing and rapidly growing cities such as Bhubaneswar, Cuttack, Rourkela, Sambalpur, Berhampur, Balasore, and Angul. As these urban centres experience unprecedented population growth and infrastructure expansion, conventional water sources are being stretched to their absolute limits.

Officials say that the TUW Policy 2026 does not exist in isolation; it is deeply aligned with broader national and regional developmental blueprints. It closely adheres to the guidelines set out by the National Framework on Safe Reuse of Treated Water (2023) and fulfils the core sustainability objectives of the AMRUT 2.0 mission.

By taking this forward-looking step, Odisha aims to future-proof its cities, ensuring that the state’s economic and urban boom does not come at an irreversible ecological cost.