Pharmaceutical and cosmetics industry criticize new EU wastewater directive
The new EU Urban Waste Water Treatment Directive, known as ‘KARL’, not only poses major challenges for the water industry, but is also causing discontent in industry. This is because the costs for the fourth treatment stage that is now prescribed are to be borne largely by pharmaceutical and cosmetics manufacturers.
What may sound inconspicuous, however, holds considerable potential for conflict for industry: with the update of the EU Urban Waste Water Treatment Directive 91/271/EEC – or ‘KARL’ for short – adopted in November 2024, the EU is setting new standards in wastewater treatment. In addition to stricter requirements for the removal of nitrogen and phosphorus from municipal wastewater, the introduction of a fourth treatment stage is also intended to regulate the elimination of pharmaceutical residues and micro-pollutants. The financing is particularly controversial: under the so-called ‘extended producer responsibility’, the directive requires pharmaceutical and cosmetics companies to cover at least 80 per cent of the investment and operating costs.
The magnitude of the financial burden is enormous. In Germany, the Association of Local Utilities (VKU) estimates that the introduction of the fourth treatment stage will cost around nine billion euros. The Federal Environment Agency estimates that there will be additional annual operating costs of 1.2 billion euros. Implementation will take place in stages: initially, treatment plants with a capacity of over 150,000 population equivalents will be retrofitted, followed later by medium-sized plants in particularly polluted areas.
So far, wastewater treatment has been carried out in three stages: First, undissolved substances are removed mechanically using rakes and sedimentation tanks. In the next step, microorganisms biologically degrade dissolved organic substances, which also removes nitrogen compounds. The third stage eliminates phosphorus compounds by chemical precipitation. Despite these measures, micropollutants such as pharmaceutical active ingredients, cosmetic ingredients, microplastics and per- and polyfluorinated alkyl substances (PFAS) remain in the wastewater – substances that are to be removed from the water cycle in the future with the new fourth treatment stage.
Removal of trace substances: a necessary step to protect the environment
The new treatment stage is primarily aimed at micro-pollutants that are not easily biodegradable and are hazardous to the environment. Even small quantities of pharmaceutical residues that enter wastewater through human excreta or improper disposal can disrupt biological processes in aquatic organisms. Hormones are particularly problematic in this regard – and antibiotics contribute to the development of antibiotic-resistant bacteria. Cosmetic ingredients such as parabens and phthalates act as endocrine disruptors and impair the reproduction and development of animals. In addition, there are microplastics and PFAS – so-called ‘forever chemicals’ – which cause massive environmental problems due to their persistence and toxicity.
The introduction of such substances leads to a loss of biodiversity, disruption of ecological cycles and an increase in the effort required for drinking water treatment. In the future, innovative processes such as ozonation and activated carbon adsorption will be used to <effectively remove these substances <in the fourth treatment stage, sustainably improving water quality and protecting aquatic ecosystems.
Industry and municipalities in dispute over responsibility and costs
However, the fourth stage is expensive – and the ‘extended producer responsibility’ introduced by the EU Commission polarises. Municipal associations such as the VKU and the German Association of Energy and Water Industries (BDEW) welcome the directive as an ‘environmental and economic milestone’. They see the polluter-pays principle not only as a fair distribution of the burden, but also as an incentive for industry to develop more environmentally friendly products. By contrast, industry representatives such as the German Chemical Industry Association (VCI) criticise the regulation as ‘completely misguided’ and warn of competitive disadvantages for the European economy.
The criticism of the pharmaceutical association Pro Generika is particularly fierce. Due to the price cap for generic drugs in Germany, the additional costs cannot be passed on to consumers. This makes the production of generics in Europe uneconomical and could lead to supply shortages of essential medicines such as antibiotics and cancer drugs. The cosmetics industry, whose contribution to micro-pollutant pollution is comparatively low, also sees itself as being disproportionately burdened by the flat-rate cost distribution.
Stricter limit values, energy-neutral operation and an ambitious schedule
In addition to the fourth treatment stage, the directive also tightens the limit values for nitrogen and phosphorus in order to further reduce the nutrient load in water bodies. This requires additional technical retrofitting in the third treatment stage at many treatment plants. In addition, the directive requires EU member states to promote the reuse of treated wastewater, particularly in water-scarce regions. Another new requirement is the comprehensive monitoring of wastewater for antibiotic-resistant pathogens, viruses and microplastics in order to better assess the risks to the environment and public health. A long-term goal of the directive is to make the wastewater sector energy-neutral by 2045. To achieve this, new technologies and energy-efficient operating methods are to be introduced. In addition, a health monitoring system is planned that uses wastewater data to identify public health trends and risks at an early stage.
Implementation by 2045, municipalities must start investing as early as 2025
There seems to be plenty of time before the final implementation in 2045 – but the roadmap is in place and the clock is ticking: On 5 November 2024, the EU Council of Ministers adopted the final decision on the EU Urban Wastewater Directive, which will be announced in the Official Journal of the European Union in the fourth quarter of 2024. After that, the member states will have a period of presumably 30 months to implement the directive into national law. In Germany, this will be done by amending the Water Resources Act (WHG) and accompanying ordinances.
The implementation is to take place in stages: the adaptation of large wastewater treatment plants with a capacity of over 150,000 population equivalents will begin as early as 2025, followed by plants with a capacity between 10,000 and 150,000 population equivalents in particularly polluted regions. The complete expansion of the fourth treatment stage and compliance with all new requirements should be completed by 2045.
Conclusion: there is no way around the introduction of the treatment stage – but the financing and distribution of the burdens and responsibilities will be hotly debated in the coming years. And the affected industries have another concern: in the past, EU directives were often tightened and introduction schedules shortened in Germany on its own – should that happen again, the chemical, pharmaceutical and cosmetics industries fear further costs and competitive disadvantages.
