In the context of continuous droughts, the search for alternative water sources and increasing environmental restrictions on discharge of treated wastewater into natural water bodies, treated wastewater recycling offers a potential solution. In this paper the methods needed to assess the questions - to what extent treated wastewater can complement the existing water sources in different sectors and at what cost - are discussed? It was concluded that a comparative Benefit Cost Analysis of different combinations of uses and treatment levels would be a critical component in the development of a decision support tool which could be used by urban planners and water authorities. It was also found that community acceptance of recycled water, distribution of costs and benefits of recycling and its broader impact on regional development are issues that need to be considered, along with the economics of wastewater recycling.