Because of the significance of the river Nišava for the city, the Municipality of Pirot has adopted a water protection concept for the city of Pirot and several smaller settlements located upstream along the Nišava River (Krupac, Veliko Selo, Veliki Jovanovac, Mali Jovanovac, Trnjana, Izvor). The wastewater treatment would be done either at the central wastewater treatment plant (WWTP) Pirot or at several decentralized treatment facilities, despite the settlements being smaller than 2000 population equivalent (PE). Three variants were considered for the analysis of water protection in the Municipality of Pirot: the first variant involves the treatment of wastewater from the city of Pirot and all the considered settlements at the central WWTP Pirot; the second variant involves the treatment of wastewater from the city of Pirot and suburban settlements at the central WWTP Pirot, and upstream settlements at the WWTP Krupac; the third variant involves the treatment of wastewater from the city of Pirot and suburban settlements at the central WWTP of Pirot, and the other settlements at their respective decentralized WWTPs. The aim of this paper is to determine the most economically viable solution by applying a costbenefit analysis, using criteria related to wastewater treatment and water pollution prevention. The paper applied the basic steps of economic cost-benefit analysis, concluding that the third alternative solution with a centralized WWTP Pirot and three decentralized WWTPs is the most cost-effective and ensures the project sustainability, which is crucial for achieving long-term development goals.

In locations with low population density or constraints in technology, resources, and personnel, the use of centralized wastewater treatment systems is not be justified. In such areas, decentralized wastewater treatment systems offer several advantages overcentralized systems. In these systems, the treatment and disposal of effluent is close to the source of waste water production, which reduces investments in a long sewage network and enables the application of other methods of wastewater transport, such as pressure sewerage and vacuum sewerage. A significant advantage of decentralized systems is their ability to be installed quickly, while also enabling local water reuse and implementation of the principles of circular economy, thereby enhancing productivity. In Serbia, according to the 2011 census, there are 449 settlements with more than 2,000 equivalent inhabitants whose wastewater should undergo at least secondary biological treatment. Given that approximately 80% of these settlements have populations ranging from 2,000 to 10,000, the implementation of decentralized wastewater treatment systems becomes imperative for sustainable water protection in Serbia. This paper provides a brief overview of decentralized wastewater treatment systems and, using the example of the municipality of Pirot, highlights the advantages and significance of implementing decentralized treatment to ensure a safe, reliable, economically justified, and ecologically sound solution for protecting water resources from pollution.