The New Zealand testing will take place over 12 months and test for drugs including methamphetamine, cannabis, MDMA, LSD, ketamine, cocaine, heroin, and common psychoactive substances.
"We're aiming to get a snapshot of drug use ... by analysing the amount and type of illicit drugs in wastewater, enforcement and health agencies will be able to more accurately detect prevalence of illicit drug use, and inform treatment and enforcement strategies," a police spokeswoman said.
The testing will not be aimed at individuals or addresses.
The police research will be similar to a pilot study completed earlier this year and led by Massey University's Chris Wilkins, when sewage was sampled at Auckland's Mangere and Rosedale water treatment plants - a catchment of 1.3 million people.
Samples from wastewater before it enters treatment facilities were collected and tested for metabolites that the body produces after ingesting drugs. It was then possible to work out the volume of consumption per 1000 people.
How a city's drug use changes throughout the week or year can be tracked, as can the emergence of new drugs.
The $220,000 of Government funding made available for the new police research will mean it will be more extensive than Dr Wilkins' pilot, and cover more drugs such as cannabis.
Dr Wilkins also oversees the annual national drug survey, and told the Herald that wastewater epidemiology had advantages - people did not need to agree to be interviewed, there were no issues with authenticity or recall.
"Sometimes they don't know what drugs they are taking. They say, 'I'm taking ecstasy'. But with this method we'll actually identify compounds. It is a really exciting thing," he said.
The national survey takes about six months for collection and testing, and another six months for analysis and reporting.Wastewater analysis delivers an almost real-time picture of drug use which is important for police, health agencies and researchers.
"Increasingly, drug use is not the traditional cocaine, heroin, cannabis - it is a whole lot of compounds.
"We are having situations where you might hear of a spate of emergency department admissions for a particular drug. But the problem is often the people that are taking it don't really know what it is they are taking, so there is a real challenge in terms of identifying drugs now, because they are different types of compounds rather than [traditional drugs]."
The police research is likely to start early in the New Year.