Hydropower is a well-known technology, applied worldwide for electricity generation from renewable sources. Within the current framework, some studies have started to consider its application to existing urban water systems, to harness an excess of energy that otherwise would be wasted. This research sought to determine a methodology to assess the potential of hydropower application to wastewater treatment plants (WWTPs), regarding different aspects of sustainability. Firstly, previously developed methodologies for potential assessment in this sector at a country level were analyzed. Secondly, data from existing real case studies were gathered from publicly available documents and a theoretical analysis of their actual performance was conducted to validate assumptions made in the previous methodologies. As a result, the proposed new approach suggests adapting methodologies for potential assessment at a lower level, considering possible driving factors, other than economic feasibility. To define the study area, the management model scope should be considered. The power to determine the cut-off point for a WWTP to be considered as a potential site, is proposed to be lowered according to technical feasibility. Additionally, bearing in mind the sustainability concept, social or environmental factors should also be introduced in the methodology, tailored to the region being assessed. This novel perspective could provide a closer approach to the most likely decision-making level for these kinds of strategies in the wastewater industry.