If you don't have a good supply of halite or sulfur you cannot treat waste into water.
Note: if you build enough waste energy plants such that you have negative waste production, and you reach 0 waste, your populace will become unhappy because they have been put out of a job. Waste management buildings will be damaged, so try to ensure that you have a steady balance of waste and waste disposal.
This building also consumes the second largest amount of waste per hour in the game being second only to the Waste Exchanger. This building is also commonly used as the primary water producer for many planets especially for Gas Giants.