Business
Would You Drink Wastewater? What if It Was Beer?
Epic OneWater Brew looks like your classic hipster craft beer.
The can has a sleek design with the silhouette of a city skyline, and it cracks open with a satisfying hiss. The beer, a Kölsch, has a crisp golden hue and a signature fruity taste.
But there is one big difference: It is made with recycled wastewater.
Epic OneWater Brew, the product of a partnership between a wastewater technology start-up and a Bay Area craft brewery, is made with treated shower and laundry water collected from a luxury high-rise apartment building in San Francisco. And it’s not the only beer of its kind.
As water sources, particularly in the western United States, dry up from overuse, drought and climate change, supporters of direct potable reuse — the use of treated wastewater in the drinking water supply — are pitching it as part of the solution. Increasingly, they are turning to beer as a way of getting people beyond the “ick factor” that has been a hurdle to its broader acceptance.
If people are reluctant to drink recycled wastewater, the thinking goes, perhaps they could be enticed if it were served in the form of a frosty cold one.
Aaron Tartakovsky, the co-founder and chief executive of Epic Cleantec, the wastewater technology company that worked with Devil’s Canyon Brewing Company of San Carlos, Calif., to create Epic OneWater Brew, said he wanted to make the beer to show the “untapped potential” of water reuse.
“We live in what we like to call here at Epic a ‘flush-and-forget’ society,” he said. “We have this innate yuck factor when it comes to talking about wastewater, or sewage, and all of these other sort of yuck-factor topics.”
Some Western and Southwestern cities that are struggling to manage the challenges of population growth and strained water supplies have held competitions for craft breweries to produce signature beers using recycled wastewater. California, Idaho and Arizona are among the states that have worked with local breweries to raise awareness of the need for water reuse.
Scottsdale, Ariz., which has watered nearly two dozen golf courses with treated wastewater since the 1990s, received a state permit in 2019 allowing for direct potable reuse of its purified recycled water. Scottsdale isn’t currently sending that water into the drinking supply, but Brian Biesemeyer, the executive director of Scottsdale Water, said that could change in two or three years.
To help the public get their heads around the concept of drinking treated wastewater, Scottsdale Water invited 10 breweries to make beer using water from the city’s advanced water treatment plant and serve it at an arts festival in 2019. The beer tents were accompanied by an information booth that explained the recycling process.
While people at first went wide-eyed at the prospect of drinking treated wastewater, Mr. Biesemeyer said, many were eager to sample the beers after a tutorial on how clean and safe the treated water is.
“We found the beer event to be a fun way to kind of get people over that fear,” he said.
Desert Monks Brewing Company of Gilbert, Ariz., which took part in the Scottsdale challenge, has embraced the concept and has brewed two beers with Scottsdale’s treated wastewater. Sonoran Mist, a lager, has quickly become the brewery’s top seller, and a Hefeweizen will be added to the lineup next month.
Two of the brewery’s owners, Sommer Decker and John Decker, believe Desert Monks is the first brewery in the country to consistently offer beer made with recycled wastewater on tap.
“We’re a small brewery, so being able to get this ultrapurified water from a large-scale entity gave us water that was more purified than we can get from our own systems at this point,” Ms. Decker said.
Getting over the ‘ick factor’
Efforts to promote the wider use of recycled drinking water have suffered from a perception problem, amplified by detractors who have denounced the process as “toilet to tap.” But researchers at Stanford University found last year that recycled wastewater is safe to drink and also less toxic than other tap water sources because it is more rigorously treated.
In Scottsdale, that process involves ozone infusion, microfiltration and reverse osmosis, in which water is forced across a membrane to remove dissolved minerals and other impurities. The water is then zapped with ultraviolet light. Together, these measures remove “darn near everything,” Mr. Biesemeyer said.
“I think the biggest thing was, it tastes good,” said Chris Garrett, the owner of Devil’s Canyon, where Epic OneWater Brew was made, noting that people have preconceived notions about wastewater. “They assume, ‘Oh my God, it’s sink water.’ And it’s like, well, it’s actually probably cleaner than what’s coming out of the rivers.”
The Epic brew was born out of a 2021 San Francisco ordinance requiring new buildings larger than 100,000 square feet to have on-site water reuse programs. Epic Cleantec partnered with 1550 Mission Street, a luxury high-rise apartment building, and Devil’s Canyon to turn the building’s greywater — runoff from laundry and showers, not toilets — into beer. Epic OneWater Brew is not for sale, but Mr. Tartakovsky said he served it at his wedding last month.
When a brewery in Half Moon Bay, Calif., decided to try brewing with wastewater, it turned to a neighbor for help: NASA, which developed its own water recycling technology so its astronauts could drink water in space. The Half Moon Bay Brewing Company picked up recycled greywater from the space agency’s Ames Research Center in Mountain View, Calif., and used it to make a limited-edition India Pale Ale called Tunnel Vision. The beer was served at events for limited periods between 2014 and 2017.
“The water was even more neutral than the water we use here,” said James Costa, the brewmaster at Half Moon Bay. “No one could tell the difference.”
Judging water ‘by its quality, not its history’
The Pure Water Brewing Alliance is a coalition of water utility companies, brewers, engineering firms and tech companies that share resources, techniques and information for using recycled wastewater to make beer. The goal, said Travis Loop, one of the leaders of the alliance, is for “water to be judged by its quality, not its history.”
“We have the technology to clean water, to purify water,” he said. “And as we can see by the times we’re in, we’re going to need to be doing a lot more of that.”
Boise, Idaho, a rapidly growing city in the high desert, turned to the alliance when it was looking to update its water treatment and distribution system in 2018. A fellow member, Pima County, Ariz., offered Boise a trailer with technology that could turn wastewater into drinkable water. Other members shared paperwork they had used to get permits to use recycled wastewater for brewing beer, condensing a process that had previously taken six months to just six weeks, Mr. Loop said. Boise teamed up with three breweries and a cidery, and hosted events in 2018 where the recycled wastewater drinks were served.
For now, recycled wastewater beer is available for sale only in Arizona. Since wastewater can’t be consumed in California, breweries there have been limited to one-off brews for specific events. In Idaho, a permit that allowed the consumption of reclaimed wastewater was valid only briefly, in 2018, but Boise is developing a full-scale water recycling program.
Scottsdale is the only city in Arizona that lets the public sample recycled wastewater. That works to the advantage of Desert Monks, which has capitalized on its access to large quantities of ultrapure water. A self-professed “huge science fiction nerd,” Mr. Decker, one of the brewery’s co-owners, joked that he has set his sights far beyond Arizona.
“I’m using the same water processes that astronauts use,” he said. “So if anyone’s going to Mars, we have the beer for them.”
California government’s plan to phase out heavy-duty diesel trucks and diesel locomotives has been derailed.
The ambitious plan aimed at reducing local pollution and global greenhouse gases required special waivers from the federal government. The Biden administration hadn’t granted the waivers as of this week, and rather than face almost certain denial by the incoming Trump administration, the state withdrew its waiver request.
That means the far-reaching regulations issued by the California Air Resources Board in 2022 to ban new diesel truck sales by 2036 and force fleet owners to take them off the road by 2042 won’t be enforced. Known as the Advanced Clean Fleets rule, the idea was to replace those trucks with electric and hydrogen-powered versions, which dramatically reduce emissions but are currently two to three times more expensive.
“While we are disappointed that U.S. EPA was unable to act on all the requests in time, the withdrawal is an important step given the uncertainty presented by the incoming administration that previously attacked California’s programs to protect public health and the climate and has said will continue to oppose those programs,” CARB Chair Liane Randolph said in a prepared statement.
Environmentalists reacted with deep disappointment.
“To meet basic standards for healthy air, California has to shift to zero-emissions trucks and trains in the coming years. Diesel is one of the most dangerous kinds of air pollution for human health,” Paul Cort, director of Earthjustice’s Right to Zero campaign, said in a prepared statement. “We’ll be working tirelessly in the coming years — and calling on Gov. [Gavin] Newsom, state legislators, and our air quality regulators to join us — to clean up our freight system and fix the mess [U.S.] EPA’s inaction has created.”
The trucking industry is pleased at the result, but hopes to continue working with California on environmental issues.
“This rule was flawed, and was not reflective of reality,” said Matt Schrap, chief executive at the Harbor Trucking Assn. “Ideally this is an opportunity to take a step back and look at a program that would be more sustainable.”
Trucking representatives had filed a lawsuit to block the rules, arguing they would cause irreparable harm to the industry and the wider economy. Train operators said no zero-emission locomotives exist on the commercial market.
Schrap said “the most important thing is the EPA could have issued the waiver and they didn’t.”
The EPA said it acknowledges California’s withdrawal of the waiver requests “and as a result is taking no further action on CARB’s prior requests and considers these matters closed.”
President-elect Donald Trump is a champion of the fossil fuel industry, making it unlikely that his administration would have approved the California waivers. The state could, however, pursue waivers at some point in the future.
Under the federal Clean Air Act, California is allowed to set its own air standards, and other states are allowed to follow California’s lead. But federal government waivers are required. Most of California’s waivers have been granted, including approval in December of a California ban on new sales of gas-powered cars and light trucks by 2035.
Bezos, Zuckerberg and Coke at the inauguration
Corporate America had already raced to donate big sums to Donald Trump’s record-breaking inaugural fund. Now some of its leaders appear eager to jockey for prominent positions at the inauguration next week.
It’s a new reminder that for some of the nation’s biggest businesses, forging close ties to a president-elect who is promising hard-hitting policies like tariffs is a priority this time around.
Jeff Bezos and Mark Zuckerberg are expected to be on the inauguration dais, according to NBC News, alongside Elon Musk and several cabinet picks.
The presence of Musk isn’t a surprise, given the Tesla chief’s significant support of and huge influence over Trump. But the other tech moguls have only more recently been seen as supporters of the administration. (Indeed, Bezos frequently sparred with Trump during his first presidential term.)
It’s the latest effort by Bezos and Zuckerberg to burnish their Trump credentials. At the DealBook Summit in December, Bezos — whose Amazon has faced scrutiny under the Biden administration and whose Blue Origin is hoping to win government rocket contracts — said that he was “very hopeful” about Trump’s efforts to reduce regulation.
And Zuckerberg recently announced significant changes to Meta’s content moderation policy, including relaxing restrictions on speech seen as protecting groups including L.G.B.T.Q. people that won praise from Trump and other conservatives. On the inauguration front, Zuckerberg is also co-hosting a reception alongside the longtime Trump backers Miriam Adelson, Tilman Fertitta and Todd Ricketts.
Both tech moguls have visited Mar-a-Lago since the election, with Zuckerberg having done so more than once.
Coca-Cola took a different tack. The drinks giant’s C.E.O., James Quincey, gave Trump what an aide called the “first ever Presidential Commemorative Inaugural Diet Coke bottle.”
More broadly, business leaders want a piece of the inauguration action. The Times previously reported that the Trump inaugural fund had surpassed $170 million, a record, and that even major donors have been wait-listed for events.
Others are throwing unofficial events around Washington, including an “Inaugural Crypto Ball” that will feature Snoop Dogg, with tickets starting at $5,000, The Wall Street Journal reports.
It’s a reminder that C.E.O.s are reading the room, and preparing their companies for a president who has proposed creating an “External Revenue Service” to oversee what he has promised will be wide-ranging tariffs.
David Urban, a longtime Trump adviser who’s hosting a pre-inauguration event, told The Journal, “This is the world order, and if we’re going to succeed, we need to get with the world order.”
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In other Trump news: The president-elect is expected to appear via videoconference at the World Economic Forum in Davos, Switzerland, which starts on Inauguration Day, according to Semafor.
HERE’S WHAT’S HAPPENING
Investors brace for the latest inflation data. The Consumer Price Index report, due out at 8:30 a.m. Eastern, is expected to show that inflation ticked up last month, most likely because of climbing food and fuel costs. Global bond markets have been rattled as slow progress on slowing inflation has prompted the Fed to slash its forecast for interest rate cuts.
More Trump cabinet picks will appear before the Senate on Wednesday. Senator Marco Rubio of Florida, the choice for secretary of state, is expected to field questions about his views on the Middle East, Ukraine and China, but is expected to be confirmed. Russell Vought, the pick to run the Office of Management and Budget, will most likely be asked about his advocacy for drastically shrinking the federal government, a key Trump objective. And Sean Duffy, the Fox Business host chosen to lead the Transportation Department, will probably face questions on how he would oversee matters including aviation safety and autonomous vehicles, the latter of which is a priority for Elon Musk.
Meta plans to lay off another 5 percent of its employees. Mark Zuckerberg, the tech giant’s C.E.O., told staff members to prepare for “extensive performance-based cuts” as the company braces for “an intense year.” The social media giant faces intense competition in the race to commercialize artificial intelligence.
A new bill would give TikTok a reprieve from a ban in the United States. Senator Ed Markey, Democrat of Massachusetts, said he planned to introduce the Extend the TikTok Deadline Act, which would give the video platform 270 additional days to be divested from its Chinese parent, ByteDance before being blacklisted. It’s the latest effort to buy TikTok time, as the app faces a Jan. 19 deadline set by a law; President-elect Donald Trump has opposed the potential ban as well.
A question of succession
JPMorgan Chase and BlackRock, the giant money manager, just reported earnings. (In short: Both handily beat analyst expectations.)
But the Wall Street giants are likely to face questioning on a particular issue on Wednesday: Which top lieutenants are in line to replace their larger-than-life C.E.O.s, Jamie Dimon and Larry Fink.
Who’s out:
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Daniel Pinto, who had long been Dimon’s right-hand man, said he would officially drop his responsibilities as JPMorgan’s C.O.O. in June and retire at the end of 2026. Jenn Piepszak, the co-C.E.O. of the company’s core commercial and investment bank, has become C.O.O.
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And Mark Wiedman, the head of BlackRock’s global client business and a top contender to succeed Fink, is planning to leave, according to news reports.
What Wall Street is gossiping about JPMorgan: Even in taking the C.O.O. role, JPMorgan said that Piepszak wasn’t interested in succeeding Dimon “at this time.” DealBook hears that while she genuinely appears not to want to pursue the top job, the phrasing covers her in case she changes her mind.
For now, that means the most likely candidates for the top spot are Marianne Lake, the company’s head of consumer and community banking; Troy Rohrbaugh, the other co-head of the commercial and investment bank; and Doug Petno, a co-head of global banking.
The buzz around BlackRock: Wiedman reportedly didn’t want to keep waiting to succeed Fink and is expected to seek a C.E.O. position elsewhere. (So sudden was his departure that he’s forfeiting about $8 million worth of stock options and, according to The Wall Street Journal, he doesn’t have another job lined up yet.)
Fink said on CNBC on Wednesday that Wiedman’s departure had been in the works for some time, with the executive having expressed a desire to leave about six months ago.
Other candidates to take over for Fink include Martin Small, BlackRock’s C.F.O.; Rob Goldstein, the firm’s C.O.O.; and Rachel Lord, the head of international.
But Dimon and Fink aren’t going anywhere just yet. Dimon, 68, said only last year that he might not be in the role in five years. And Fink, 72, said in July that he was working on succession planning: “When I do believe the next generation is ready, I’m out.”
The S.E.C. gets in a final shot at Musk
Another battle between Elon Musk and the S.E.C. erupted on Tuesday, with the agency suing the tech mogul over his 2022 purchase of Twitter.
It’s unclear what happens to the lawsuit once President-elect Donald Trump, who counts Musk as a close ally, takes office. But the agency’s reputation as an independent watchdog may be at stake.
A recap: The S.E.C. accused Musk of violating securities laws in his $44 billion acquisition of the social media company.
The agency said that Musk had failed to disclose his Twitter ownership stake for a pivotal 11-day stretch before revealing his intentions to purchase the company. That breach allowed him to buy up at least $150 million worth of Twitter shares at a lower price — to the detriment of existing shareholders, the agency argues.
The S.E.C. isn’t just seeking to fine Musk. It wants him to pay back the windfall. “That’s unusual,” Ann Lipton, a professor at Tulane Law School, told DealBook.
Alex Spiro, Musk’s lawyer, called the latest action a “sham” and accused the agency of waging a “multiyear campaign of harassment” against him.
The showdown sets up a tough question for the S.E.C. Will Paul Atkins, the president-elect’s widely respected pick to lead the agency, drop the case? Such a move could call the bedrock principle of S.E.C. independence into question.
Jay Clayton, who led the agency during Trump’s first term, earned the respect of the business community for running it in a largely drama-free manner. It was under Clayton that the S.E.C. sued Musk over his statements about taking Tesla private.
Musk, who is set to become Trump’s cost-cutting czar and is expected to have office space in the White House complex, has called for the “comprehensive overhaul” of agencies like the S.E.C. The billionaire said he would also like to see “punitive action against those individuals who have abused their regulatory power for personal and political gain.”
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In related news: The Consumer Financial Protection Bureau sued Capital One, accusing it of cheating its depositors out of $2 billion in interest payments.
THE SPEED READ
Deals
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DAZN, the streaming network backed by the billionaire businessman Len Blavatnik, is closing in on funding from Saudi Arabia’s sovereign wealth fund as the kingdom continues to expand its sports footprint. (NYT)
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The Justice Department sued KKR, accusing the investment giant of withholding information during government reviews for several of its deals. KKR filed a countersuit. (Bloomberg)
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OpenAI added Adebayo Ogunlesi, the billionaire co-founder of the infrastructure investment firm Global Infrastructure Partners, to its board. (FT)
Politics and policy
Best of the rest
We’d like your feedback! Please email thoughts and suggestions to dealbook@nytimes.com.
As wildfires continue to burn around Southern California, thousands of business owners, homeowners and renters are confronting the daunting challenge of rebuilding from the ashes. For some number of them, the road ahead will be all the more difficult because they didn’t have any or enough insurance to cover their losses. For them, the U.S. Small Business Administration is a possible lifeline.
The SBA, which offers emergency loans to businesses, homeowners, renters and nonprofits, is among the few relief options for those who don’t have insurance or are underinsured. Uninsured Angelenos can also apply for disaster assistance through the Federal Emergency Management Agency, or FEMA.
The current wildfires are ravaging a state that was already in the midst of a home insurance crisis. Thousands of homeowners have lost their insurance in recent years as providers pull out of fire-prone areas and jack up their prices in the face of rising risk.
“For those who are not going to get that insurance payout, this is available,” Small Business Administration head Isabella Casillas Guzman said in an interview during a recent trip to the fire areas. “The loans are intended to fill gaps, and that is very broad.”
About one-third of businesses don’t have insurance and three-quarters are underinsured, Guzman said.
“There will be residual effects around the whole community,” she said. “Insurance will not cover this disaster.”
Businesses, nonprofits and small agricultural cooperatives can apply for an economic injury loan or a physical damage loan through SBA. Homeowners are eligible for physical damage loans. Economic injury loans are intended to help businesses meet ordinary financial demands, while physical damage loans provide funds for repairs and restoration. People can apply online and loans must be repaid within 30 years.
Renters can receive up to $100,000 in assistance, homeowners up to $500,000 and businesses up to $2 million, according to Guzman. Homeowners and renters who cannot get access to credit elsewhere can qualify for loans with a interest rate of 2.5%. The SBA determines an applicant has no credit available elsewhere if they do not have other funds to pay for disaster recovery and cannot borrow from nongovernment sources.
Interest rates for homeowners and renters who do have access to credit elsewhere are just over 5%. Loans for businesses could come with interest rates of 4% or 8% depending on whether the business has other credit options.
An applicant must show they are able to repay their loan and have a credit history acceptable to the SBA in order to be approved. The loans became available following President Biden’s declaration of a major disaster in California.
“We’ve already received hundreds of applications from individuals and businesses interested in exploring additional support,” Guzman said. “We know the economic disruption may not be contained to the footprint of any evacuation zones or power outages.”
People who don’t have insurance or whose insurance doesn’t cover the entirety of their losses are eligible for loans, Guzman said. While many will use the funds to start from scratch after losing their property to the fires, businesses that are still standing can also apply for support to cover lost revenue.
Guzman was not able to estimate the total value of loans they expect to offer in California but said the organization is on solid financial footing after temporarily running out of funds in October.
“Funding has been replenished by Congress, and we expect to be able to coordinate closely with Congress,” Guzman said. “We’re fully funded and in a good position to provide support.”
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