Here’s a conundrum.

Your state has a severe water shortage. So it invests in wastewater recycling, hoping to reduce the need to import water (the transport of which is its single most energy-intensive activity). It then passes a pioneering climate change law. But five years later, it turns out the recycling is contributing to global warming by producing lots of greenhouse gases. What do you do?

Over the past few years, Southern California has built several wastewater reclamation plants, aiming to reduce its intake of water from the Bay Area and the Colorado River. It uses the non-potable resource in public parks and other urban green spaces.

But new research says the facilities are emitting three times as much nitrous oxide (N2O) as a conventional process that sends treated sewage to a river or ocean. Although N2O is also known as “laughing gas” and “sweet air,” and is a drug used by dentists and thrill-seekers, it is also greenhouse gas 298 times as potent as CO2.

Amy Townsend-Small, an assistant professor at the University of Cincinnati, who conducted the research along with a team at the University of California, Irvine, says the N2O is a by-product of a process that uses bacteria to break down effluent. Scientists already knew about the problem, but the research, published in the latest edition of the Journal of Environmental Quality, is the first to identify and quantify the problem in California.

The revelation throws up a classic environmental policy double-bind, and means that two of state’s most prized environmental initiatives could be in conflict. California’s 2006 Global Warming Solutions Act defines N2O as one of six greenhouse gases, and sets a target of reducing emissions to 1990 levels by 2020.