Research, part of a special feature on The Next Wave in Water Governance

INTRODUCTION

Over the last decades, it has become apparent that the way water is managed and consumed is unsustainable and that change is needed. Although the concept of circular economy (CE) applied to the field of water (CEW) is relatively new (Morseletto et al. 2022), it offers a promising avenue to address water scarcity and insecurity and is increasingly put forward in water policy and research (International Water Association (IWA) 2016, Sauvé et al. 2021). For example, the new EU circular economy action plan launched in 2020 as part of the European Green Deal aims to enhance a circular transition, also in the field of water (European Commission 2020). Circular economy counters the linear economic model, where products are made from raw materials and considered waste after use, and includes the goals of eliminating waste and pollution, circulating products and materials at their highest value, keeping products and materials in use, and regenerating natural systems (Tahir et al. 2018). Circular economy can be defined as a systems solution framework that embraces the idea that materials, components, and products should be designed and produced to be restored, retained, and redistributed in the economy for as long as it is environmentally, technically, socially, and economically feasible (Kirchherr et al. 2017, Ellen MacArthur Foundation 2013:7). In the context of water, CEW offers a paradigm shift to similarly move away from a traditional linear economy, where water is extracted from the environment, used, treated, and discharged, to build a new framework that reduces preserves, and optimizes the uses of water while ensuring environmental protection and conservation. This can be achieved through different approaches to rethink, avoid, reduce, replace, reuse, recycle, cascade, store, and recover water (Morseletto et al. 2022).

The field of CE is characterized by a focus on technical interventions (Kirchherr and van Santen 2019) applied to water; this translates into a focus on technologies to support water reuse (Salgot and Folch 2018, Capodaglio 2020, Rizzo et al. 2020). Yet water governance, meaning the range of political, social, economic, and administrative systems in place to develop and manage water resources and the delivery of water services (Rogers and Hall 2003), is frequently recognized as a barrier for CEW implementation and as something that needs to be considered and explored further. Governance barriers to CEW have been highlighted in the literature, including public perception, inadequate regulatory frameworks, and economic constraints to financing circular water projects (Frijns et al. 2016, IWA 2016, Makropoulos et al. 2018, Nkhoma et al. 2021). However, the literature on CEW governance is fragmented and scattered across fields of study and disciplines. Relevant work spans environmental economics, political sciences, and environmental engineering, often operating in parallel rather than in dialog. Diverse social science theories, such as collaborative governance (Ddiba et al. 2020), transition theory (Afghani et al. 2022), or transformative change (van Duuren et al. 2019) are sporadically applied and seldom integrated. This disciplinary fragmentation is also visible in the application of concepts, such as legitimacy (Blankesteijn and Bossink 2020) and social learning (Fulgenzi et al. 2020). Economic approaches tend to focus on valuation methods for ecosystem services (Danso et al. 2017, Ding et al. 2019), further illustrating disciplinary silos. This diversity reflects the growing interest in CEW, but also illustrates how differing conceptual framings, terminologies, and disciplinary perspectives can make it challenging to gain an integrated overview and to synthesize findings across fields.

Responding to this gap, this research examines existing literature on the governance of CEW through the lens of the governance dilemmas framework (Jordan et al. 2010, Patterson and Huitema 2019): including problem perception, level and scale, timing and sequencing, mode and instrument, cost and benefit, and implementation and enforcement (Table 1). These dilemmas are a useful lens to examine the governance of CEW, as they provide insights into how complex climate change challenges such as CEW are addressed, organized, and governed through individual and collective responses at various scales (Huitema et al. 2016).

By drawing attention to and reflecting on the assumptions made in the literature, we offer insights into the existing knowledge base of CEW governance. We show that the literature often adopts a normative stance and does not differentiate between the varying conceptualizations of CEW. Broadly, CEW can be understood as a reformist strategy focused on improving the efficiency of existing systems or as a transformative approach that seeks to fundamentally reconfigure social-ecological relations. Most of the studied literature emphasizes a reformist perspective, focusing on optimizing existing systems through technological interventions such as water recycling and reuse, particularly in industrial and agricultural settings, while paying comparatively less attention to strategies aimed at reducing consumption. This view is also characterized by a somewhat limited conceptualization of the roles of different governance actors, including the state, civil society, and the private sector. Building on this, we call for greater analytical attention to more transformative understandings of CEW: those that align with Feola’s (2015) concept of transformative change as a major, fundamental shift, as opposed to minor or incremental adjustments (Kapoor 2007, O‛Brien 2012). Although reformist approaches contribute to important efficiencies, they often reproduce existing institutional and socio-political structures. In contrast, transformative understandings of CEW challenge dominant governance paradigms, redefine societal values around water use, promote regenerating natural systems, and embed circularity as a systemic principle rather than a technical fix, thereby potentially inducing a paradigm shift in water governance.

This paper is structured as follows, first we outline the systematic literature review (SLR) methodology employed in this study. We then present the results, organizing the findings around the six governance dilemmas proposed by Jordan et al. (2010). Each dilemma is addressed in turn to identify patterns and gaps in how CEW is conceptualized in the literature. Finally, we discuss the implications of these findings, highlighting dominant framings and proposing alternative perspectives that bring forward more transformative and socially just approaches to CEW.

METHODS

We conducted a SLR to address the study’s main objective, as this allows identifying, selecting, and assessing the existing literature in the field of interest and answers the research questions: what is the current scope of knowledge around the governance of CEW? How do existing studies suggest governance of CEW should be organized? To support the reporting of the systematic review and ensure that the article selection process is carried out in a reproducible and transparent way, we used the checklist of the “Preferred Reporting Items for Systematic Reviews and Meta-Analyses” (PRISMA) (Moher et al. 2009). The PRISMA method guides the selection process stage by stage, by pre-defining the keywords, the databases, and the inclusion and exclusion criteria. This method consists of several steps: developing the search strings, gathering the data (i.e., identifying articles, screening articles, and selecting articles), and analyzing the data (Page et al. 2021). All three steps are further described below.

Developing the search strings

The lead author conducted the electronic searches in November 2023, in Scopus and Web of Science. For the selection of keywords, we used semantic fields, as they group related words by meaning and help develop comprehensive search strings that ensure all relevant studies are captured. Three sets of semantic fields were identified as necessary: CE, water, and governance aspects of CEW. For this last category, the objective was to find keywords broad enough to encompass all governance aspects of CEW, while being sufficiently exclusive from the natural sciences and engineering literature to allow a suitable selection of papers.

After studying existing reviews on CE and how the concept is currently defined (Kirchherr et al. 2017), we chose the following keywords for the semantic field of CE: “Circular Economy” OR “CE” OR “circular” OR “circularity.” Next, building on the water governance definition used in the introduction, the selected set of keywords for CEW governance was: “social,” “cultural,” “policy,” and “market.” The term “economy” was not added again here, as it was already included in the search strings related to CE.

The final selected search terms were: (“Circular Economy” OR “CE” OR “circular” OR “circularity”) AND (“water”) AND (“social” OR “cultural” OR “policy” OR “market”). The search field was defined as “Article title, Abstract, Keywords” in Scopus, and “Topic” in “Web of Science Core Collection” in Web of Science. Search types were both set on “Advanced.”

Gathering the literature

To bound the study, we specified the following criteria: the research dates were set from 1990 to 2023 (as no relevant studies were identified before 1990), the language request was set to English, and the document types were limited to peer-reviewed articles and review articles. After this first set of screening automation tools, we merged the results of both databases to continue the screening process and removed all duplicates. The second screening step consisted of using inclusion/exclusion criteria for article titles, article abstracts, and entire articles. Following the PRISMA checklist, we established two sets of inclusion/exclusion criteria before the screening process:

1. Is the paper related to CEW?
2. Does the paper address CEW governance?

The answer to both criteria had to be “Yes” for the article to be included in the review. The criteria were used in the specific order that they are presented above. Based on the eligibility criteria mentioned, the lead author reviewed titles and abstracts to determine whether they should be included. The next phase involved full-text reviews, retrieving and analyzing all records selected from the screening phase. The overall article-selection flow diagram is provided in Fig. 1. We found 1,504 articles initially. This number was reduced to 178. The most restrictive criterion was the second one (i.e., does the paper address governance settings of CEW), as a large majority of the papers focused on natural sciences and engineering without including governance elements.

Analyzing the data

After the screening process, we kept and analyzed 178 studies for this review (Append. 2). The lead author coded all articles using the Atlas.TI software, extracting bibliometric and qualitative elements. We created four categories of codes on Atlas.TI: bibliometrics (i.e., publication year, methodology), circular definitions and framing, area of application (i.e., geographical and sectoral applications of CEW), and governance-related elements. The framing code consists of understanding what strategy of CEW was applied in the article (e.g., recycling water, recovering biogas from wastewater). All statements related to governance elements were coded in the Atlas.TI software and inductively grouped into governance categories. For example, if a paper stated the need to work on public trust, legitimacy, and communication to improve the social acceptability of a CEW project, the text was coded as “Acceptability.” In total, we created six categories of governance codes: “acceptability,̵ “responsibility,” “economics,” “collaboration,” “risk management,̵ and “policies and regulation.” The Acceptability code holds elements on perception (e.g., yuck factor, disgust) and knowledge management (e.g., awareness, trust, information); the Responsibility code addresses roles of public and private actors and management responsibilities (e.g., planning, execution); the Economics code encompasses financial aspects (e.g., investments, funding, subsidies) and value assessments (e.g., costs, benefits); the Collaboration code involves networking, participation, and cooperation across multiple levels (e.g., local, regional, national); the Risk Management code deals with various risk types (e.g., contaminants, pollutants, health risks) and their monitoring (e.g., standards, controls); and the Policy and Regulation code includes elements on strategies and legislative instruments (e.g., taxes, incentives). The coding process is further described in Append. 1. Because some articles cover multiple topics, statements were sometimes coded multiple times (e.g., when a paper stated that collaboration positively affects public acceptability of CEW, both “Acceptability̵ and “Collaboration” codes were used). All governance codes were further structured according to the six governance dilemmas identified by Jordan et al. (2010): problem perception, level and scale, timing and sequencing, mode and instrument, cost and benefit, and implementation and enforcement. The coding process is described in Fig. 2.

RESULTS

Problem perception

Looking at the temporal spread of the 178 articles identified, Fig. 3 shows that CEW governance has been the focus of academic concern since 2014. The drop in 2023 is related to the fact that the literature search was conducted in November 2023, before the end of the year. Articles may have come out afterward, also in 2024, with an official publication year of 2023. The geographical focus of the case studies in the selected articles is mainly Europe (n = 107). Within Europe, areas of interest include the European Union as a whole (n = 20), the Netherlands (n = 16), Italy (n = 15), and Spain (n = 11) (Fig. 4). Asia (n = 24), in particular China (n = 10) and India (n = 6), is the next most common area studied in the articles. Areas poorly represented in the sample include Africa (n = 11), North America (n = 9), South America (n = 8), the Middle East (n = 3), and Oceania (n = 1). The recent European Green Deal (European Commission 2019), the new EU circular economy action plan (European Commission 2020), and the recent European regulation 2020/741 on minimum requirements for water reuse applicable to all member states since June 2023 (European Union 2020) could explain the European focus as well as the recent rise in articles.

Although relatively recent, there are patterns in how CEW is framed and discussed in the literature. Although clear definitions of CEW and CE are lacking in half of the papers (i.e., 89 papers offer clear definitions of CEW or CE), practical applications of CEW, particularly in case studies, illustrate diverse framings of CEW. Three frames of CEW are commonly applied in the literature. The first is optimizing, which considers CEW as a way to use water more efficiently, allowing the same water to be reused multiple times, with or without intermediate treatments. The second is retaining, where CEW takes place to store water (i.e., putting used water aside, before or after treating it, into a specific reservoir where it will be available for future uses) and retain materials (e.g., bioplastics, nutrients) and energy in the economic system. Finally, the decreasing frame focuses on reducing water use.

Circular economy of water can be framed in different ways (i.e., optimizing, decreasing, retaining). Figure 5 shows how these are distributed across articles and highlights that the literature mainly focuses on optimizing water use (49%). Within the optimizing frame, articles mainly focus on recycling water, for the same or a different purpose. The retaining frame represents 13% of the articles. These focus on recovering nutrients (e.g., use of wastewater sludges in agriculture) and energy (e.g., biogas production from wastewater sludges). The decreasing frame represents 7% of the studies. No CEW frame was identified in 31% of the articles, as those focus either on several frames simultaneously (van Zyl and Jooste 2022) or on reshaping economics, facilities, policies, regulations, technologies, and uses around water more generally. Circular economy of water can therefore be understood as a recent European-centered challenge, perceived and framed around the optimization of current water uses through recycling and reusing water.

Level and scale

Next, Jordan et al. (2010) focuses on considering the appropriate level and scale for CEW implementation. In the studied literature, although the critical role of municipal and regional administrations in leading a transition toward CEW is notable (e.g., Sugiyono and Dewancker 2020, Asprilla Echeverría 2021, Södergren and Palm 2021, Berbel et al. 2023), literature glosses over the role of the micro level in a CEW. Morseletto et al. (2022:1473) contend that “governments and water authorities are responsible for designing the most effective water governance mechanisms (...) for the CEW” by aligning local specificities with national targets. Such assertions appear to be more normative than evidence based, as the literature offers limited empirical investigation into how these actors define or enact such effectiveness in practice. Södergren and Palm (2021), in connection with CEW implementation in Sweden, argue that municipally owned corporations have clearer responsibility for the profits, larger financial freedom of action, and less political control than national authorities. They highlight that municipal administrations tend to support a more holistic and inclusive approach to CEW implementation but may face challenges due to budget constraints and prioritization of other local issues. Also, stakeholders at different levels (i.e., local, regional, national) can have different priorities that do not always align. A notable message in the literature is that fragmented regulatory frameworks promote inconsistent roles and responsibilities (Brown and Farrelly 2009). For example, in the Indonesian context, Eneng et al. (2018) describe how responsibility for implementing CEW-related policies is delegated from the national to local and provincial governments. However, in practice, local and provincial agencies often prioritize attracting investment and generating tax revenue over environmental protection or the implementation of CE principles. The authors note that permits for groundwater extraction are typically granted with the primary aim of supporting regional economic development, whereas environmental assessments and long-term sustainability considerations receive limited attention. Institutional competition between government agencies, driven by differing tax structures, further undermines coordination and leads to fragmented oversight. This fragmented governance is presented as a key barrier to the effective implementation of CEW. As such, multi-level governance systems (e.g., governance between ministries, regions, and municipalities) are increasingly studied in the CEW literature (Flores et al. 2018, Fassio et al. 2022, Cagno et al. 2023), and often presented as potential solutions that would solve fragmentation and overlapping priorities challenges. However, the practical implementation of multi-level governance systems in CEW is relatively underexplored, with few concrete solutions presented. Ding et al. (2019) offer some suggestions, including establishing dedicated governmental bodies to coordinate between different levels of government to achieve CEW. This suggestion is somewhat exceptional in the literature, as it contrasts with the general tendency to under-theorize multi-level governance in the CEW field. Moreover, scholars like Skelcher (2005) argue that the proliferation of such coordinating bodies has become problematic in public administration, as they can lead to excessive bureaucracy and inefficiency. Although Ding et al.’s suggestion presents an interesting avenue, it seems important to question whether creating additional layers of coordination would exacerbate or alleviate existing governance challenges in the context of CEW.

Jordan et al. (2010) associate scale with specific values such as flexibility, accountability, and transparency, which are embedded within broader governance levels. Although these values are presented as essential to the governance of CEW, the literature often uniquely assigns them to certain actors (e.g., Kjellen 2018, Oughton et al. 2021, Ballesteros-Olza et al. 2022). Taking flexibility as an example—understood as the capacity to be dynamic, adaptive, and responsive when navigating complex and uncertain policies—it is often linked to the private sector in the literature. Makropoulos et al. (2018) examine sewer mining technology applications in Greece and suggest that “At the small-scale (...) a private operator (e.g., a start-up or an SME) would seem more flexible to manage the challenges of ecosystem services diversification” (Makropoulos et al. 2018:296). Similarly, Seifert et al. (2019) investigate CEW and wastewater treatment plants in Germany and argue for private–public partnerships to increase the flexibility of wastewater services investments. Both examples suggest that flexibility is understood as economic efficiency and attributed to the private rather than the public sector. Also, studies focusing on ensuring transparency, accountability, and controllable distribution of roles and responsibilities are currently lacking and fundamental to overcoming administrative obstacles (Alamanos et al. 2022). These results suggest that deeper investigation is needed into the most appropriate governance mode for leading a CEW transition and the role of different actors, which are often assumed rather than empirically investigated.

Mode and instrument

The third governance dilemma introduced by Jordan et al. (2010) focuses on who leads a CEW transition and how (e.g., van Duuren et al. 2019, Dingemans et al. 2020, de Lauwere et al. 2022, Morseletto et al. 2022). The literature assumes specific roles for stakeholders in CEW, specifically for the public and private sectors. The public sector is the key actor mentioned in the studied literature. Several studies qualify water as a public good (e.g., Eneng et al. 2018, Asprilla Echeverría 2021) and argue that public sector leadership is essential for enhancing a CEW transition, as relying on the profit-oriented private sector risks undermining the collective responsibility to ensure universal water access (e.g., Eneng et al. 2018, Ddiba et al. 2020). Compiling the literature, we find a long list of “must dos” by the public sector: setting regulations and standards, monitoring and evaluating policies, providing funding for projects and innovation research, convening stakeholders for collaboration, promoting and implementing CEW projects (e.g., Danso et al. 2017, Ddiba et al. 2020, Franco-Torres 2021, Ballesteros-Olza et al. 2022). The public sector is, at the same time, also heavily criticized in the literature as having a short-term vision, a lack of a clear strategy, delays in administrative procedures, and limited public capacities (e.g., Flores et al. 2018, Ddiba et al. 2020, Ballesteros-Olza et al. 2022). On the other hand, studies recognize the private sector’s leadership in a CEW transition as necessary (e.g., Maquet 2020, Fico et al. 2022) and sometimes even preferable to that of the public sector, as the private sector is portrayed as dealing better with risk management and generating higher earnings (Fico et al. 2022). To overcome this public–private duality, the literature tends to present the network mode (i.e., governance led by trust and collaboration, rather than by rules or prices) as the most appropriate one for enhancing a circular transition (Miranda et al. 2022). The studied literature focuses heavily on collaboration, assuming that all sectors should necessarily align and synchronize their work (Ddiba et al. 2020), whereas lack of communication between regulators and planners is presented as a concern (Frijns et al. 2016). The collaborative governance model often presented suggests the need to redistribute responsibilities among politics, society, and the private domain (de Lauwere et al. 2022). Questions emerge, such as what constitutes a good redistribution of responsibilities, as studies point to the public sector as the primary investor in innovation, responsible for injecting capital expenditure and providing subsidies (e.g., Guerrini and Manca 2020, Laitinen et al. 2020, Agudo et al. 2022). This expectation is based on the public sector’s role in bearing the financial risk associated with early stage investments, as highlighted by Mazzucato (2013). Conversely, the private sector is depicted as entering the market only when it becomes economically viable (Ddiba et al. 2020), thus significantly limiting its financial risk. This dynamic suggests that the public sector is often expected to shoulder the investment risk without generating any earnings, whereas the private sector benefits once the financial conditions are favorable. The role of other entities in the CEW transition, such as non-governmental organizations or civil society, is rarely discussed in the literature. Savini and Giezen (2020) study the division of responsibilities in a circular transition in the city of Amsterdam regarding water, energy, and waste. They discuss problem ownership, revealing a dilemma between giving more responsibility to households in the transition, without diminishing government accountability. They suggest that environmental governance around CE is contradictory as actors simultaneously over-stretch and under-reach their responsibilities. This tension illustrates a broader challenge in CEW governance: the ongoing search for an optimal balance of responsibilities that would ensure accountability across all actors. This seems to point to a dilemma in determining the appropriate level and locus of responsibility among public and private actors.

One central way responsibilities are defined in literature and actors are coordinated is through policy. In the CEW literature, this often translates as determining the optimal level of regulation. The literature agrees that implementation of CEW requires tailor-made policies and regulations. However, at the same time, these are often stated as barriers, with particular questions around their design, flexibility, effectiveness, and suitability (Frijns et al. 2016, Blankesteijn and Bossink 2020). Although the CEW literature highlights the need for clarity within regulations and policies, there is a concern that excessive regulation can hinder progress, create complexity, and enhance costs in the development of projects (Frijns et al. 2016). As Seifert et al. (2019) state, “...we see a double-edged sword. On the one hand, it ensures adherence to minimum requirements. On the other hand, it can tie up a large part of an organization’s human and financial resources and prevent innovation” (Seifert et al. 2019:161). This highlights the elusive search for an optimal regulation level, which seems perpetually out of reach in CEW governance.

Timing and sequencing

In the realm of CEW, governors are tasked with deciding when to act and in what sequence (i.e., in what order and timing to implement actions). Surprisingly, the question of action timing is often absent in CEW literature, which could mean that the dynamics of timely and strategic decision making in CEW are potentially not understood. Identifying the optimal intervention sequence proves to be challenging, and contention exists in the literature. Laitinen et al. (2020) argue that circular benefits tend to accrue over long-term horizons, whereas decision makers work over shorter-term horizons. Choices have to be made, between curative (i.e., react) or preventive (i.e., anticipate) modes of action, which sit in opposition to the lengths of political cycles (Flores et al. 2018).

A further aspect of timing and sequencing relates to risk, and how risks are viewed across different time horizons, including environmental, health-related risks (Moya-Fernández et al. 2021), and financial risks (e.g., Savini and Giezen 2020, Qtaishat et al. 2022). Environmental and health-related risks involve elevated concentrations of contaminants that can occur when reusing water in different cycles, all of which are evolving and often not known in advance (Brînzan et al. 2020). For example, new contaminants emerge, and knowledge is lacking on their level of risks and degradation processes (e.g., Ekane et al. 2021, Qtaishat et al. 2022, Palmeros Parada et al. 2022).

Risk management is a significant concern in CEW, as the literature explains that wastewater discharges can still contain various potentially dangerous pollutants, such as pathogens, micropollutants, antibiotic-resistant genes, nanomaterials, disinfection by-products, personal care products, and pharmaceuticals (Dingemans et al. 2020, Guerra-Rodríguez et al. 2020). In CEW literature, risk management is primarily discussed in terms of recycling water and recovering materials, with a focus on concentration levels, pollutant risks, and the risks associated with investing in new technologies. In their study on risk perceptions on the application of sewage sludge on agricultural land in Sweden, Ekane et al. (2021) state that uncertainty related to pollutants determines the type and magnitude of risk citizens may tolerate and thus plays a role in shaping public perceptions and policy directions.

Regarding sequencing, the public sector is described in the literature as a crucial early stage actor that leads the way to a circular transition. Because many innovative circular solutions tend to not be commercially viable at their beginning, it is again expected that the public sector will fund innovation and circular initiatives in their early stages, allowing the private sector to jump in once solutions are commercially viable (Ddiba et al. 2020), or to put policy instruments in place, such as pollution taxes, to support the commercial viability of circular initiatives (Shen et al. 2020). This echoes again with the work of Mazzucato (2013), which suggests that the private sector takes minimal risks while primarily benefiting from high-risk investments made by the public sector.

Cost and benefit

Different types of CEW policies generate different distributions of costs and benefits among stakeholders. Looking at the practical applications of CEW in the literature, we identify five core domains (Fig. 6): (i) agriculture, including the reuse of water for irrigating crops (Vivaldi et al. 2022), or recovering nutrients from wastewater sludges for crops (Gwara et al. 2022); (ii) industry, including manufacturing firms (Cagno et al. 2023), small and medium enterprises (Bassi and Dias 2019), and the hospitality industry (Bux and Amicarelli 2023); (iii) cities, including circular urban water management (Arora et al. 2022, Castellet-Viciano et al. 2022); (iv) healthcare services, including hospitals (Vaccari et al. 2017); and (v) the water sector, including wastewater treatment (Mannina et al. 2022a, b), drinking water (Eneng et al. 2018), water supply system (i.e., articles focusing on CEW applications in both wastewater treatment and drinking water), and water ecosystems (Fidélis et al. 2021).

Private actors such as agriculture and industry claim a significant share of domains benefiting from CEW (i.e., agriculture with 23% and industry with 16%). This can be explained by the emergence of pressing needs in those sectors, for instance in agriculture, where water can be lacking in summer. Another focus of the literature is set on wastewater treatment plants (i.e., 27.9% of the total sample), emphasizing facility-centric perspectives of CEW. The regeneration of natural water ecosystems is not driving the emergence of circular water projects (i.e., 4% of the total sample).

Although the studied literature suggests that the benefits should mainly accrue to the private sector, such as agriculture and industry, it appears costs are to be borne primarily by the public sector and civil society. Indeed, the issue of acceptability is predominantly centered on civil society, which is portrayed in the literature as a significant barrier jeopardizing the implementation and upscaling of water reuse schemes (Chrispim et al. 2020, Ballesteros-Olza et al. 2022). Civil society is expected to accept risks linked to circular initiative projects, sometimes without them being attributed a leading role in the transition. Emotional reactions of disgust toward CEW strategies, known as the “yuck factor”, are often the thematic focus in studies on civil society (e.g., Smith et al. 2018, López-Serrano et al. 2022). For example, Medeiros et al. (2021) highlight that health, risk, disgust, and odor are the main barriers to urine fertilizer use in agriculture. Such barriers are closely tied to the sewage side of the water sector. To overcome this, information provision is suggested as a response while assuming the positive effect of information and education on the acceptability of CEW projects (Hartley 2006, Makropoulos et al. 2018, Villarín and Merel 2020). In this vein, we see a priority placed on disseminating information to gain social acceptance for circular water projects, and less around civil society and how they may or may not engage in dialogs, or how CEW might seek to reconfigure consumption practices.

Trust and legitimacy also appear in the literature as possible solutions to enhancing acceptability and as a response to possible issues of costs and benefits. Frijns et al. (2016) argue that public support for water reuse is influenced by trust in the technical process, the regulation, and the organizations in charge. The studied literature considers a lack of public and institutional acceptability of CEW as a threat and as a problem to be solved (Chrispim et al. 2020, Ballesteros-Olza et al. 2022). Although various solutions for managing social acceptability are explored, a question arises regarding the role of citizens in the implementation, if and when they should be integrated into decision processes, and how they may experience costs and benefits. This questions the application of accountability and transparency in practice.

Implementation and enforcement

Due to the limited nature of circular water projects across the world, (Ddiba et al. 2020, Caparrós-Mártinez et al. 2020), limited discussions on implementation and enforcement exist in the literature. Debates regarding the appropriate level of action are discussed through top-down or bottom-up approaches. Yang et al. (2022) explain that bottom-up management policies are predominantly favored in Western economies, whereas top-down national development strategies are preferred in non-Western economies, such as China. The studied literature appears undecided on the most appropriate degree of centralization for circular water initiatives (i.e., decentralized or centralized water management) (Cipolletta et al. 2021). As highlighted in the previous sections, questions persist regarding the applicability and efficiency of a multi-level governance framework in addressing CEW implementation challenges. Uncertainties linger regarding the timing of governance interventions (i.e., anticipatory or reactive and long term or short term). The extent of public participation remains ambiguous, and the notion of power distribution within circular governance structures remains unexplored.

Similar questions exist when addressing the enforcement of CEW initiatives. Despite the emergence of ambitious policies, such as achieving full circularity in water management by 2050 in Europe (European Commission 2020), enforcement mechanisms remain nascent. Although standards—like the recent European regulation 2020/741 on minimum requirements for water reuse—are being established, robust enforcement measures are yet to materialize. The literature offers some ideas, focusing on command and incentive economic instruments. Command instruments involve adapting the tax system to incentivize circular practices (Hagenvoort et al. 2019) or implementing tradable permits (Brînzan et al. 2020). The literature suggests that tax adjustments can reward companies and individuals for embracing CEW, and tradable permits put a cap-and-trade system in place and allow targeting specific sectors first (e.g., industries, farmers). Incentive instruments include measures like supporting research and development on water circular technologies (Mohtar et al. 2022), offering subsidies for capital expenditure to get rid of initial investment burdens (Ddiba et al. 2020), adapting pricing mechanisms to reflect the value of circular products (Giannoccaro et al. 2022), investing in institutional capacity building (Kjellen 2018), or creating new markets for circular products.

DISCUSSION

We analyzed the literature through six governance dilemmas established by Jordan et al. (2010): problem perception, level and scale, mode and instrument, timing and sequencing, cost and benefit, and implementation and enforcement. Overall, results highlight that academic literature focuses on emphasizing the optimization of existing systems through water recycling and reuse, with less of a focus on decreasing water consumption. Using the dilemmas framework, we identified different framings of CEW in the literature (i.e., optimizing, decreasing, retaining), and interest around some core applications, including water for industrial processes and agricultural irrigation. There is a misalignment between how CEW is defined in the literature (i.e., a systems solution framework, that should, among other elements, focus on regenerating natural systems), and how it is tackled in CEW literature. The current research landscape predominantly focuses on optimizing current linear water systems to satisfy increasing water demand in economic sectors suffering from water shortages, such as industry or agriculture, while missing discussions on the regeneration of natural systems (Fig. 5). This study shows that the literature offers a narrow, facility-centric and reformist perspective on CEW, as reflected in the prominence of efforts to optimize circularity within wastewater treatment plants (27.9% of the sample). This emphasis on technical and instrumental approaches contrasts with potentially more transformative understandings of CEW, such as rethinking water consumption patterns. Such transformative approaches might involve questioning societal norms around water uses, promoting behavioral changes, shifting the focus from technological fixes to systemic changes.

A facility-centric understanding of CEW can influence how literature suggests governance of CEW should be organized. For example, when studies look at social acceptability, we found that a big focus is on the yuck factor and potential environmental and health risks (e.g., Smith et al. 2018, Medeiros et al. 2021, López-Serrano et al. 2022). These elements would probably be less critical, framed differently, or seen as less of a concern, if the focus of CEW were on decreasing strategies, where water reduction is the focus. Similarly, the studied literature shows that, although economics is a primary concern for CEW, articles support the idea that the public and private sectors should invest more in infrastructure projects (e.g., Guerrini and Manca 2020, Laitinen et al. 2020, Agudo et al. 2022). Once again, implementing CEW through decreasing strategies would necessitate fewer investments in capital expenditures for projects.

We also demonstrate that the current research assumes specific roles for actors in the transition toward CEW: the public sector is expected to bear investment risks without generating any earnings, and the private sector tends to benefit once the financial conditions are favorable (e.g., Ddiba et al. 2020). When exploring the level and scale, mode and instrument, and cost and benefit dilemmas, these demonstrate assumptions around the role of different actors, including the state, private sector, and civil society, and a lesser understanding of how these roles are fulfilled. The literature indicates that costs should mainly be borne by the public sector and civil society, with a strong emphasis on enhancing public acceptability. A different understanding of CEW could lead to rethinking the roles of actors, specifically for civil society which is currently passively described and not offered an active role in the transition.

Circular economy of water is still a concept under development that could benefit from engagement with critical literature. The literature used in this study views CEW as a goal-driven approach, emphasizing the necessity of overcoming various barriers for a successful circular transition. The vocabulary and literature surrounding CEW are prescriptive, focusing on what “must be done,” with limited criticism reported in the academic literature studied when discussing governance. One point for reflection is the limited consideration for thinking through alternative solutions. Discussions on the role of civil society are acknowledged, but framed narrowly, in terms of public acceptability. This framing tends to position civil society as an audience to be informed or persuaded, rather than as an active participant in shaping CEW. A broader perspective could highlight how civil society contributes to knowledge production, co-design, and the redefinition of water-related practices and values. It could also invite critical reflection on who decides where water goes, under what principles, and for whose benefit, bringing to the forefront issues of power, equity, and social justice in the allocation and governance of CEW initiatives.

The legitimacy of certain barriers and the societal benefits are not fully explored in the literature. Barriers and opportunities are viewed in a normative and static manner, with a distinct separation between overcoming them to succeed in the circular transition or succumbing to them and failing in the transition. Such an understanding of CEW echoes the work of Lazarevic and Valve (2017), who state that CE is left “deliberately vague but uncontroversial” (Lazarevic and Valve 2017:1) and that we have “yet to see the contentions being fully playing out” (Lazarevic and Valve 2017:1). There is a need for a more incremental and dynamic approach to understanding barriers and opportunities in CEW governance to unravel policy processes and understand impasses. Biesbroek et al. (2014) suggest that, when studying governance barriers to sustainable transition, the focus should lie on detailing the process analysis and linking plausible causes to observed outcome patterns. Linking to CEW, we see a need for studies examining in-depth challenges that arise through decision-making processes, such as the impact of policies, how institutional parties handle conflict resolution in the context of circular water implementation, and how power relations can affect the water circular transition.

Therefore, although CEW is a holistic concept, it can be argued that great variations exist when discussing aspects of governance, and how it can be organized. This raises questions about the comprehensive nature of CEW practices and their impact on the transition. There is a risk that a loosely defined CEW concept could be used merely as a green label, perpetuating business-as-usual practices without truly transforming the linear economy paradigm. This statement also resonates with the work of Ampe et al. (2020), who demonstrate that optimizing large-scale infrastructure, market development, and legislative changes is currently the dominant discourse in the transition toward a CE in the Dutch wastewater system. This dominant approach creates lock-in effects that focus action on technical changes and only leave space for small incremental changes.

CONCLUSION

We conducted a review of 178 papers related to CEW and governance. By analyzing the literature through six governance dilemmas, we found that CEW is currently predominantly studied in a European context. This may be linked to the EU’s political agenda, notably the new CE Action Plan (European Commission 2020), introduced as part of the Green Deal (European Commission 2019), which explicitly supports a circular transition across sectors, including water. In this literature, CEW is strongly focused on optimizing existing systems through recycling and reusing water. In general, the studied literature lacks distance and critical engagement toward CEW. The literature tends to be optimistic and goal driven about the concept of CEW. Literature focuses on improving or changing aspects of our current water governance to facilitate a transition toward CEW. However, literature often does not question the relevance of CEW in different situations, or the concept itself.

This study also highlights research gaps and recommends future research directions. We suggest examining governance barriers and opportunities in a more dynamic and complex way by studying decision-making processes in greater detail. More empirical studies are needed on how practitioners use and frame the concept in practice, how to include civil society in a CEW transition, and on implementation strategies (e.g., decentralized or centralized projects). Additionally, more research is required on how governance dilemmas interrelate, the possible synergies between them, and potential governance leverage points. For practitioners and researchers, we recommend caution when using the CEW concept, considering how they frame it and how they address governance dilemmas.

The main limitation of this study lies in its methodological constraints, as it relies on peer-reviewed published literature only. The omission of gray literature, including reports, regulations, international, national, and regional plans, and other non-peer-reviewed sources, may introduce gaps and blind spots. We suggest future studies include these. Another limitation of this study is that only articles written in English were reviewed. Despite these limitations, the study serves as a valuable snapshot of the existing scholarly discourse on CEW, providing avenues for future research directions.

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