Though the droughts in the Southeast have eased, the need to conserve water has not—36 states are facing water shortages by 2015.

Conservation measures are underway in homes around the country in the form of low-flow plumbing fixtures, rainwater harvesting, and native landscaping, but more needs to be done: Population growth and land use will to continue to challenge strained resources that already are leading to water-use wars around the country.

At the residential level, one of the chief problems is that every day we send the majority of our pure, treated drinking water down the drain—not into our bodies—said Mike Hoover, a professor at the North Carolina State University Department of Soil Science and a speaker during the 2010 NAHB National Green Building Conference. The average U.S. home uses 400 gallons of water per day; of that, less than 3 gallons are for personal consumption.

Hoover believes we need to re-envision water and begin thinking about its various purposes. In other words, why not have “toilet flushing water,” “laundry water,” etc., in addition to “drinking water”?

Among the many solutions being employed, Hoover is working to bring attention to the idea of “decentralized wastewater reuse.” Wastewater reuse isn’t a new concept—it’s practiced on a centralized (i.e., community) basis more and more. But what’s not as common are on-site systems, in which certain types of wastewater are treated and reused on site.

It’s expensive to treat potable water on site, but not to treat non-potable water. At the single-family-home level, this means focusing on graywater—drainage from clothes washing and bathing that equates to 40% of a home’s wastewater and is fairly easy to treat, said Tom Bruursema of NSF International. That water can be treated on site and then reused for toilet flushing and other non-potable uses, saving the centrally treated potable water purely for consumption, food prep, and bathing.

Such systems don’t just conserve drinking water—they can save energy and money, too: Instead of pumping water from the home, to the treatment center, and back into the cycle, some water remains on site for a longer period of time. It also equates to reduced water and sewer bills for homeowners.

There is a great deal of potential for decentralized reuse for small-scale installations such as hotels, golf courses, and residential developments, Hoover said. The Center for Health and Healing in Portland, Ore., for example, installed a decentralized system and has had a 56% drop in potable water use, saving 15,000 gallons a day.

Like many new ideas, much of the challenge with implementing decentralized wastewater reuse lies in a lack of codes and a lack of knowledge—and a lot of misperceptions from the homeowner up through the utilities and health officials.

To combat these assumptions, Hoover is leading a new think tank he hopes will bring together thought-leaders from around the industry to determine how to get the technology into homes within five years.

In addition, the Centers for Disease Control is conducting a study of eight sites utilizing the technology, and NSF International also is working on a consensus standard for on-site water reuse technologies.

“Wastewater is now being recognized as a resource,” said speaker Shane Keaney of Bord na Mona Environmental Products. In fact, Florida is targeting 75% reuse by 2025 and California Governor Arnold Schwarzenegger recently called for a 20% water use reduction in the state by 2020.

Hoover predicts that we’ll see it in use in single-family homes within five to 10 years. His hope is that someday a homeowner will be able to pick up the phone and order a reuse system as easily as any other upgrade.

Bruursema also sees a shift in the near future, but agrees that developing systems and building confidence—and creating product standards—will be key.

Katy Tomasulo is Deputy Editor for EcoHome.