In early autumn, the lake at Binzhou Zhonghai Park is as smooth as a mirror. The reason this artificial lake in a water-scarce northern city never runs dry lies in a wastewater treatment plant several kilometers away—urban sewage, after advanced treatment, transforms into clean water that steadily flows into the lake, replenishing its source. This water has a new name: reclaimed water. The journey from wastewater that everyone avoids to the clean flow that anchors urban landscapes represents a profound reshaping of water's value. With per capita water resources less than one-sixth of the national average, Shandong cannot rely solely on traditional water diversion and storage to break its "water bottleneck"—it must also tap into the potential of water conservation. The large-scale utilization of reclaimed water is a strategic move born from this approach. In 2025, the province's unconventional water usage reached 2.354 billion cubic meters, ranking among the highest in the nation, with over 80% of that being reclaimed water. An entire reclaimed water industry chain—spanning membrane materials, water treatment, equipment manufacturing, and operational services—is rapidly taking shape across the Qilu region.

Wastewater treatment plants are evolving into "water suppliers." At the Gezhouba Water (Binzhou) Co., Ltd. facility, the contrast between influent and effluent is stark: the incoming sewage is murky, while the outflow is crystal clear. "The treated reclaimed water meets Class III surface water standards, satisfying the needs of surrounding enterprises like Binzhou Chemical Group and Datang Power for circulating cooling water, industrial production, municipal miscellaneous use, and ecological replenishment," explained Zhang Gang, the company's head. Zhang Gang crunched the numbers: "Reclaimed water costs 0.74 yuan per ton, compared to about 2.4 yuan per ton for conventional industrial water (including the water resource tax)." For a large chemical enterprise using 4 million tons of water annually, this translates to savings of over 6 million yuan in water fees each year. For the treatment plant itself, revenue from reclaimed water has grown from 4 million yuan in 2023 to 6 million yuan in 2025, shifting its role from single-purpose pollution control to the dual functions of "pollution treatment plus water supply." Now, capitalizing on its status as a national pilot city for reclaimed water utilization, Binzhou is accelerating the construction of reclaimed water plants and transmission pipeline networks. Eight reclaimed water plants and three seawater desalination projects are already operational across the city, with the industrial use of unconventional water increasing year by year. All 13 municipal wastewater treatment plants have completed upgrade retrofits, with effluent now meeting Class IV surface water standards, laying the water quality foundation for reclaimed water development.

Binzhou's efforts are a microcosm of the accelerating growth of the reclaimed water industry in Shandong and across China. In 2025, national unconventional water usage exceeded 25 billion cubic meters, more than doubling since 2020. Shandong alone utilized 2.354 billion cubic meters of unconventional water, of which 2.043 billion cubic meters was reclaimed water—equivalent to adding more than 1,700 Daming Lakes to the province's conventional water resources. Technological breakthroughs are extending the industrial chain. The key to moving reclaimed water from "usable" to "highly effective" lies in technology. Shandong Zhongou Membrane Technology Research Co., Ltd., located in the China-EU Water Treatment and Membrane Technology Innovation Industrial Park in Weihai, is leveraging its membrane expertise to expand into the domestic market. "Sewage passed through ceramic membranes comes out meeting reuse standards," said Zhu Yanlei, the company's deputy general manager. He describes the ceramic membrane as an ultra-fine sieve: under pressure, water molecules pass through while most bacteria, viruses, and other impurities are precisely intercepted. Transforming a membrane into hardcore technology requires persistent R&D. The company has hired several experts from Harbin Institute of Technology to overcome critical technical bottlenecks, achieving low-carbon, efficient water pollution treatment. Their products are now widely used in drinking water treatment, sewage treatment, secondary water supply, direct drinking water, and seawater desalination. "Orders for the first quarter alone have already filled our schedule through the end of the year," Zhu Yanlei noted. The industrial park in Weihai now hosts over 30 such companies, covering the entire chain from membrane materials and water treatment equipment to environmental products.

In the upstream segment of the reclaimed water industry chain, membrane technology and water treatment chemicals act as two pillars supporting development: membranes physically block contaminants, while chemicals handle scale inhibition, sterilization, and cleaning, working in tandem to ensure stable system operation. In Qihe County, Dezhou, the laboratory at Anxingda (Shandong) Environmental Technology Co., Ltd. reveals thriving microbial colonies under the microscope. These invisible microorganisms are the "special forces" in the battle against sewage pollution. "Our bacterial agents can 'consume' ammonia nitrogen in extreme environments with salinity up to 10% and can stably degrade COD in high-temperature wastewater at 50°C," said Liu Shuguang, general manager of Anxingda, pointing to the colonies in a petri dish. "It's like getting microbes to work efficiently in conditions akin to pickling vegetables." Anxingda holds eight national authorized invention patents, operates a provincial-level standard laboratory with national CNAS accreditation, and has co-built an R&D center with the Institute of Microbiology at the Chinese Academy of Sciences. Its "treating pollution with bacteria" solutions are widely applied in petrochemical, municipal, and aquaculture wastewater treatment. Shandong's water treatment chemical sector is moving from selling products to selling solutions, transitioning from "following" to "running alongside" global leaders. A growing number of local Shandong enterprises, armed with core technologies, are breaking into the supply chains of central state-owned enterprises, progressing from regional supporting roles to national competitors. From membrane material R&D and component manufacturing to water treatment chemical production, Shandong has established a complete upstream support system for the reclaimed water industry—this is the foundation of the province's ambition to shift from "application" to "innovation."

The industry faces two hurdles to breakthrough. Industrial cooling, urban greening, and ecological replenishment—the application scenarios for reclaimed water are expanding. But Shandong's exploration goes further: beyond replenishing water sources, reclaimed water is now playing an "energy" role. Late last year, the first phase of the Qingdao Licun River Reclaimed Water Clean Energy Utilization Project came online, making it the province's first reclaimed water heat source connected to the main heating pipeline, providing heating for over 1.2 million square meters of buildings. Liu Xiaoyu, general manager of Qingdao Water Energy Development Co., Ltd., said the project uses "sewage source heat pump + heating network return water heating" technology, utilizing over 21 million tons of reclaimed water annually and generating more than 500,000 gigajoules of heat per year. The water quality remains unaffected after heat extraction and continues to be used for replenishment, achieving "one water, multiple uses." Reclaimed water heating has opened new avenues for industry growth, but each "transformation" of sewage comes with challenges. The industry must clear two major hurdles. The first: water can be "produced" but cannot always be "delivered." Peng Xuejun, director of the Provincial Water Conservation Office, found during grassroots research that cases of unusable reclaimed water due to mismatched pipeline networks are not uncommon. He believes the deeper issue is that an integrated reclaimed water utilization framework between industry and city has yet to be established. Hu Hongying, a professor at Tsinghua University's School of Environment, suggests promoting reform of urban water supply and drainage systems and establishing a regional reclaimed water recycling system, using "proportion of public water-friendly spaces" and "reclaimed water replenishment coverage rate" as core indicators to achieve harmony between people, water, and city. Binzhou's approach is to let "pipeline networks follow industry"—reclaimed water plants are built around key industrial parks, with dedicated pipes laid simultaneously to deliver treated water directly to enterprise doorsteps. The city's industrial unconventional water usage has surged from 4 million cubic meters in 2020 to 40 million cubic meters in 2025.

The second hurdle: water is "priced well" but the "market is cold." Currently, reclaimed water operations are primarily market-driven. Although reclaimed water is cheaper than tap water, some enterprises remain reluctant to use it voluntarily. Combined with the low proportion of water costs in industrial expenses, large pipeline investments, and long payback periods, relying solely on market self-regulation makes it difficult to achieve economies of scale. This is why administrative measures remain necessary at the current stage. The solution lies in taking a dual approach. On one hand, "hard targets" provide leverage: Shandong Province explicitly requires that the allocation ratio of unconventional water in chemical industry parks be no less than 35%, and new water withdrawal permits will not be approved for projects that meet the conditions but fail to reasonably utilize unconventional water. On the other hand, "financial capital" provides nourishment: by the end of 2025, the province's "water-saving loan" balance reached 5.42 billion yuan, a year-on-year increase of 85.1%. At the provincial level, in November 2025, the provincial government issued the "Opinions on Implementing the Priority of Water Conservation and Comprehensively Promoting the Economical and Intensive Utilization of Water Resources," clearly integrating unconventional water into unified water resource allocation and setting hard targets such as achieving a 60% urban reclaimed water utilization rate by 2030. In the face of immutable water resource endowments, Shandong has taken reclaimed water as its breakthrough, transforming wastewater and forging a new path of water management that prioritizes conservation and efficiency. This path not only addresses the immediate thirst but also secures long-term sustainability, while simultaneously driving the rise of an emerging industry.