With regard to reusing waste water after it has been purified, a statement has been issued by the Council of Senior Scholars, the text of which is as follows: 

Praise be to Allah alone and may the blessings of Allah be upon the one after whom there is no Prophet, Muhammad, and upon his family and Companions. 

During the thirteenth session of the Council of Senior Scholars, which was held in the latter half of the month of Shawwaal 1398 AH in the city of al-Taa’if, and based on a question from the editor of the Muslim News newspaper of Cape Town, which was submitted to the Muslim World League and passed on by them to the Council of Senior Scholars, to research the matter and issue the statement of the Council on it:  

The Muslims in that place face problems because of what the Council of Industrial International Projects is planning to do of producing clean drinking water from waste water, and they are asking about the ruling on using this water for wudoo’ after it has been purified. 

Based on that, the Council examined the view concerning that expressed by the Standing Committee for Academic Research and Issuing Fatwas. The Council also studied the speech of His Highness the Minister of Agriculture and Water, no. 1/1299, dated 30/5/1398 AH. After researching and discussing the matter, the Council determined the following: 

Based on what the scholars have said about water of abundant quantity which has altered because of contamination with impurity, and that if the impurity is removed or pure water is added to it, or the impurity is removed by natural means with the passage of time or by the effects of sun or wind on it and so on, then the ruling of impurity ceases because the reason for it is no longer there. 

Impurity in water can be removed by many means, and the modern technical means used to purify water are regarded as being among the best means of purification. A great deal of effort and technical methods may be used to rid water of impurities, as testified and approved by specialists and experts in that field, whose expertise is well established.  

Hence the Council thinks that this water is pure after it has been purified completely, in that it goes back to its original state in which there is no sign of alteration caused by impurity in its taste, colour or smell, and it is permissible to use it to get rid of impurities and dirt. One may use it to purify oneself (wudoo’ and ghusl), and it is also permissible to drink it so long as no harm to one's health will result from using it, in which case one should refrain from that so as to preserve one's health and ward off harm, not because it is impure. 

The Committee affirms that if it is possible to use something else instead of this to drink, that is safer for health and so as to ward off harm, and to keep away from something that may be off-putting. 

And Allah is the source of strength. May Allah send blessings upon Allah Prophet Muhammad and upon his family and Companions. End quote. 

Council of Senior Scholars