How to decline a potential PhD supervisor?

I wouldn't say you 'wasted' their time. All supervisors are well aware that most applicants apply to more than one institution at a time; wisely so, especially that PhD admissions for good universities are highly competitive, and one shouldn't risk their chances applying only for one place.

Unless you made a promise or commitments to be working with them, you've been an applicant and have acted as such. As an applicant you have the option to decline an offer, so this is totally normal.

Therefore, you can contact the other supervisors; the sooner the better so that they can consider their other options too. You can thank them for their time and the interest they had in you, and explain your situation like you did here. They will likely understand the situation (TBH this should be happening a lot for them).

I applied to 8 PhD programs and went to 5 different interviews. I was eventually admitted to 4 programs, and had to notify the rest that I would not be attending their program. Professors do expect you to consider other choices, so do not be embarrassed. Letting them know about the decision is the best thing you can do.

I am posting one of the letters I sent in case that helps:

Hello XXX,

I am writing to let you know that I have accepted the offer of admission from Uni X. It was a difficult choice, and I will miss the atmosphere and opportunities at Uni Y, but I hope that we will be able to stay in touch. I really enjoyed meeting you and your lab members and look forward to learning about your future work!

Best, neuranna

In my case, I also sent similar (but shorter) letters to other interviewers I had, since they also invested their time and effort into considering my application.

Bottom line: there is nothing wrong with declining an offer, but do notify your prospective advisors and do it politely!

It sounds like you do not yet know what kind of funding will be available at the three institutions to which you applied. If that is a defining factor in whether you accept, I would wait until you have the final offers in hand, make your decision, and then politely decline any alternative offers. As @ali14 said, this may be disappointing to the other supervisors, but not at all unexpected or unusual.