[Saudi Arabia] Saudi Arabia Targets 70% Reclaimed Water Reuse Rate by 2030: Riyadh East Wastewater Treatment Plant Project Attracts Six International Consortia, ISTP Model Becomes Global Financing Benchmark

Saudi Arabia treats over 650万 cubic meters of municipal sewage daily, yet its reuse rate is only about 25%. The authorities have set a clear target to raise it from 2030年 to 70%. The most closely watched project currently under tender — the Riyadh East Independent Sewage Treatment Plant (ISTP) — has an initial capacity of 20万 cubic meters/day, expanding to 40万 cubic meters/day in Phase II, with commercial operation targeted for 2029年. It has attracted bids from at least six consortia formed by international water giants including Suez, Saur, Veolia, Metito, and Miahona together with local partners. The production cost of reclaimed water is only 0.10-0.65 USD/cubic meter — far below the 0.45-1.30 USD for seawater desalination — fundamentally rewriting the water economics of this "Kingdom of Desalination."

The Arithmetic Has Changed: Reclaimed Water Beats Desalination on Cost

Over the past decade, Gulf states responded to water scarcity with seawater desalination. Today, the same governments are redirecting capital to the other end of the pipe — collection, treatment, and reuse. Driving this shift is a clear economic calculation:

• Cost comparison — the production cost of reclaimed water is approximately 0.10-0.65 USD/cubic meter, versus 0.45-1.30 USD/cubic meter for seawater desalination;
• Energy comparison — large-scale wastewater treatment plants consume 0.13-0.79 kWh/cubic meter, while Reverse Osmosis desalination requires as much as 2.5-3.5 kWh/cubic meter — a multiple-fold difference;
• Strategic value — every cubic meter of sewage treated and reused releases an equivalent volume of costly desalinated water for residential supply, while reducing carbon emissions.

These figures have transformed wastewater treatment from a "municipal cost center" into a financeable asset class: 25年 and 30年 concessions, sovereign-grade offtake agreements, double-digit returns — the Gulf is building the world's most complete financial model for scaled-up reclaimed water.

Institutional Design: The Three-Power Separation of the ISTP Model

Saudi Arabia has built the region's most structured wastewater PPP market around the "Independent Sewage Treatment Plant" (ISTP) model. Its institutional design is worth examining: 25年 Build-Own-Operate-Transfer (BOT) contracts, backed by state-supported offtake agreements. Since 2024年, the former Saline Water Conversion Corporation was restructured into the Saudi Water Authority, achieving a clear separation of three roles — policy-making (Ministry of Environment), regulation (Water Authority), and procurement (Sharakat under the Ministry of Finance, 2026年2月 renamed from Saudi Water Partnership Company). It is precisely this institutional separation that makes contracts bankable for international lenders.

The financing template is already established: a green loan completed by a Spanish water group 2022年 for three wastewater treatment plants in Saudi Arabia — the country's first wastewater financing to receive green loan certification — combines an Islamic Ijara structure with S&P Global-rated green certification, and has become the benchmark structure emulated by all serious bidders. Recent levelized water tariffs for Saudi projects cluster in the 1.20-1.94 SAR/cubic meter range (approximately 0.32-0.52 USD) — tight enough to reward operators who master full lifecycle costs, yet not so low as to deter genuinely capable bidders.

Targets and Projects: A Seven-Year March from 25% to 70%

Saudi Arabia currently treats more than 650万 cubic meters of municipal sewage daily, with a reuse rate of only about one-quarter. To achieve the 2030年 70% reuse target, a portfolio of projects is advancing — the most prominent being the Riyadh East ISTP: initial capacity of 20万 cubic meters/day, expanding to 40万 cubic meters/day in Phase II, targeting commercial operation by 2029年. At least six consortia are competing, and the winner will inherit an "annuity" spanning 25年.

Regional benchmarks tell the same story: Abu Dhabi treats over 100万 cubic meters of sewage daily, with a network coverage rate of 99% and a reuse rate of approximately 80%, having set a target of 2026年 reuse (zero discharge) by 100%. Kuwait recovers nearly 60% of its domestic sewage through a single wastewater treatment plant. The UAE's 2036 Water Security Strategy likewise targets a 95% reuse rate. The entire Gulf is now managing wastewater as a strategic reserve.

What This Means for Us: Observations from TIANYI TECH

The Saudi model offers three lessons for China's domestic reclaimed water industry. First, the pricing mechanism is the anchor of marketization — a clearly defined levelized water price range and sovereign offtake guarantees give social capital the confidence to enter and stay long-term, which aligns with the direction of reclaimed water pricing reform currently being explored in China. Second, long-term concession arrangements drive whole-lifecycle cost management — within the 25年-year operation period, every one percentage point of optimization in electricity consumption per ton, chemical consumption, and membrane replacement costs translates directly into profit, making refined operational capability rather than construction cost competition the core competitive barrier. Third, the cost gap between reclaimed water and seawater desalination will continue to widen — in water-scarce coastal regions, "reuse first, desalinate second" will become the new norm in infrastructure planning. TIANYI TECH likewise applies whole-lifecycle cost optimization as the design benchmark in its industrial park reclaimed water reuse projects. We will continue to cross-validate mature international market mechanisms against domestic practice, helping clients maximize the value of every drop of reclaimed water.

About TIANYI LIMITED: TIANYI LIMITED is deeply engaged in the wastewater treatment and reclaimed water reuse sector, committed to delivering efficient, low-carbon, and sustainable water treatment solutions for municipal and industrial clients.

Sources: Smart Water Magazine, Arab News, The National (2026年8月22日) and other public reports. This article is a compilation of industry information for readers' reference.