BEST PRACTICE 3: System Water Loss Control Overview Why a Best Practice? State Planning Requirements

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1 BEST PRACTICE 3: System Loss Control Foundational best practice Utility operations - implemented by water utilities on their own system Customer participation not applicable Overview loss control is the practice of system auditing, loss tracking, infrastructure maintenance, leak detection and leak repair for water utilities. Leak detection and repair are familiar water agency practices, but true water loss control is more pragmatic than simply finding and fixing leaks. The American Works Association water loss methodology (detailed in the M36 manual and described in this best practice) is considered the industry standard (2009). Auditing a water distribution system for real and apparent losses and evaluating the costs of those losses is the foundation of water loss control. Real losses are actual physical losses of water due to leaks or other problems with the system. Apparent losses are due to meter inaccuracy, unauthorized consumption, and data handling errors. Cost and benefit considerations drive implementation actions in the recommended methodology, described in detail in the AWWA M36 Manual. Why a Best Practice? loss control represents the efforts of water utilities to provide stewardship and accountability in their operations and sets a positive example for customers. auditing and loss control give water utilities the potential to conserve significant volumes of treated water by reducing real losses and to increase revenue by reducing apparent losses. loss control is a foundational, cost-effective water conservation practice that should be implemented by all providers in Colorado. State Planning Requirements Colorado statute requires that all covered entities (water providers that deliver more than 2,000 acre-feet per year) file a water conservation plan with the Colorado Conservation Board (CWCB). Entities that do not have an approved plan on file are not eligible to receive grant funding from the State. Under this statute, one of the water saving measures and programs that must be considered in a conservation plan is, Distribution system leak identification and repair. [CRS (4)(a)(V)]. The industry standard approach to water loss control described in this Best Practices Guidebook includes distribution system leak identification and repair as a key component. This best practice is an excellent fit with current state planning requirements even though water loss terminology and methodology has developed and changed since CRS was passed. Future updates to this statute should incorporate language on system water audits and water loss management. 68

2 Applicability loss control actions as described in this best practice apply exclusively to water providers and those that manage and maintain water delivery infrastructure. Implementation loss control programs are undertaken by utility staff and their designated contractors with little or no involvement from customers. Three fundamental resources are recommended as a starting point for those seeking to implement or improve a water loss control program: American Works Association (2009) Audits and Loss Control Program: Manual of Supply Practices (M36), American Works Association, Denver, CO available for purchase from Aquacraft (2009) Utility Loss: A Review of Current Practices in Colorado, Requirements in Other States and New Procedures and Tools, Colorado Conservation Board, Denver, CO available for free download from AA139279CC44/0/16.pdf Free Excel-based water audit and loss control evaluation software developed by the AWWA Loss Control Committee. Free download available from r=48158 There are two fundamental steps when conducting a utility water system audit using the 2009 AWWA M36 methodology: (1) The Audit; and (2) The Balance. The water audit typically traces the flow of water from the site of withdrawal or treatment, through the water distribution system, and into customer properties. The water balance summarizes the components and provides accountability, as all of the water placed into a distribution system should in theory equal all of the water taken out of the distribution system. The combination of the system water audit and the water balance provide a variety of useful measures of utility water loss. Of particular interest to water agencies is the ability to quantify the costs of real and apparent water losses and to use this information to improve the bottom line. Traditional water loss accounting focused on the percentage of unaccounted for water. Under the 2009 M36 methodology, the term unaccounted for water is eliminated. Key water loss performance metrics include: Apparent losses per service connection per day Real losses per service connection per day Real losses per length of main per day Unavoidable real losses Non-revenue water as a percent by volume of water supplied Non-revenue water as a percent by cost of operating system Annual cost of apparent losses 69

3 Annual cost of real losses Figure 4-6 shows the key components of the water balance and water loss accounting in the 2009 M36 methodology. The shaded area represents water losses. Developing a utility water audit using the M36 methodology involves developing measurements or estimates of all of the values shown in Figure 4-6. Utilities first implementing this methodology are encouraged to start with a desktop audit where existing data and estimates are used as inputs to the water balance. This process is called the top-down audit. The bottom-up approach involves replacing estimated values with actual measurements and generally takes planning and effort of a number of years for a utility to fully implement. Both the top-down and bottom-up approaches are made much easier with the free software which automatically performs the required water balance calculations. Exported Billed Exported From Own Sources (corrected for known errors) System Input Volume Supplied Authorized Consumption Losses Billed Authorized Consumption Unbilled Authorized Consumption Apparent Losses Billed Metered Consumption Billed Unmetered Consumption Unbilled Metered Consumption Unbilled Unmetered Consumption Unauthorized Consumption Customer Metering Inaccuracies Systematic Data Handling Errors Leakage on Transmission and Distribution Mains Revenue Nonrevenue Imported Real Losses Leakage and Overflows at Utility's Storage Tanks Leakage on Service Connections Up to Point of Customer Metering Note: All data in volume for the period of reference, typically one year. Figure 4-6: balance for water loss audit accounting (AWWA 2009) Essential implementation steps are detailed in Table AWWA s water audits and loss control stresses information collection and data analyses. A key point in the audit process is valuing apparent losses at the prevailing retail rate. By valuing apparent losses this way, corrective actions become much more cost effective. As with any action, cost considerations are important. The AWWA water loss control audit places significant emphasis on assessing costs and benefits before setting water loss reduction targets. However, there are potential barriers to even beginning a water loss audit. Staff time and availability are probably the first barriers to 70

4 confront. Data availability and limitations of data validity are also critical barriers during the initial phase of the audit process. Apparent losses due to meter inaccuracies are an under collection of potential revenue and are inequitable in that some customers pay for less water than they actually use. The practice of right sizing meters in new accounts and in old accounts where use patterns have changed is as important as maintaining and replacing old meters. For example a site that originally was a restaurant that is replaced by a retail shop and is equipped a 2" meter when it could be adequately served by a 3/4" meter has real potential to under report consumption. Compound meters can be used on some multi-family residential accounts to ensure higher accuracy and full accounting during low consumption periods. Table 4-11: Key water loss audit implementation steps Audit Step Brief Description 1. Collect distribution Includes infrastructure, financial, and operational data. Most info should system information be readily available to a utility. 2. Measure water supplied This task identifies how much water enters the distribution system and to the distribution system where it originates. 3. Quantify billed Identifies the amount of water delivered to customers that have accounts authorized consumption in the customer billing system. 4. Calculate non-revenue Non-revenue water is amount remaining after billed authorized water consumption is deducted. 5. Quantify unbilled Includes unmetered fire hydrant use, flushing, street cleaning, etc. authorized consumption 6. Quantify water losses losses are made up of apparent and real losses. 7. Quantify apparent losses Comprised of customer meter inaccuracy, systematic data handling errors, and unauthorized consumption. 8. Quantify real losses In the top-down approach, this is calculated total water loss minus apparent losses. In bottom-up approach, physical measurements improve the measurement of real losses. 9. Assign costs of apparent Apparent losses should be valued at the prevailing retail rate charged to and real losses customers. Real losses are typically valued the same as the variable 10. Calculate performance indicators Savings and Other Benefits production costs to treat and deliver water. This task (along with many others) is done automatically through the free AWWA software. Range of Likely Savings: Varies savings from water loss management programs depend entirely on the ongoing level of loss. It should be the goal of all water providers to limit real and apparent losses to economically efficient levels. losses vary significantly from system to system. Typically, systems with older pipes and/or higher pressure have greater real losses while systems with old, over-sized water meters and/or poor accounting practices have greater apparent losses. For many water providers in Colorado, implementing the AWWA M36 water loss audit methodology may reveal 71

5 that greater financial benefits can be achieved from improved accuracy in metering than by repairing or replacing water mains. How to Determine Savings Economic levels of real and apparent water loss can be determined easily by utilizing the free AWWA water audit software. Understanding the parameters that influence loss can help an agency better understand the potential cost and water savings from various water loss control measures. loss from leakage is highly dependant on system pressure, length of mains, number of connections, and location of customer meter on service lines as well as infrastructure material and age. AWWA s 1996 benchmark of 10% unaccounted for water is no longer applicable and only measuring unaccounted for water is no longer considered an industry standard approach (AWWA 1996, 2009). The industry standard is to implement the 2009 AWWA M36 water loss methodology. The financial metrics incorporated into the AWWA M36 methodology and the free water audit software may prove to be the most valuable component for water agencies. Financial indicators are based on user-entered variable production costs and water retail costs. The software automatically calculates costs of real and apparent losses. Using these results, agencies can make rational cost-benefit decisions on prioritizing water loss control. Many utilities who have implemented this methodology were surprised to learn that the cost of their apparent losses were more significant (financially) than the cost of their real losses. In Philadelphia, PA for example, when a water audit was conducted the apparent losses were valued at $34.5 million and the real losses at $4.2 million (AWWA 2009). Savings Assumptions and Caveats The free Excel-based software calculated values are accompanied by a clear explanation showing how each calculation was made (as opposed to having the calculations performed in hidden cells or macros). This show-your-work approach allows the user to quickly understand the methodology for computing given values. The AWWA software provides a built-in assessment of the data used to calculate water loss. Because collecting valid data is an essential part of the water audit process, low data validation scores prioritize actions for improving data in water loss control. Depending on the corrective action water loss control, the lifespan of savings will vary. Utilities should understand that water loss control is an ongoing activity. Ideally a system audit should be conducted annually. Goals and Benchmarks At this time there are no established state or national standards for water loss using the 2009 M36 methodology. However, many local agencies have in-house goals relating to this best practice. The cost benefit analysis component of the water audit process can help guide agencies in setting reasonable water loss control goals. It is anticipated that when a significant number of utilities have successfully completed the AWWA water audit methodology and achieved an acceptable level of data validity then realistic 72

6 benchmarks can be established. In most cases a cost-benefit ratio greater than 1.0 is desired for implementation of a conservation measure. Other Benefits of Loss Control Additional benefits of water loss control include: Reduced road repair by decreasing frequency of main breaks via pressure management Improved utility water and cost accounting Improved water meter testing and evaluation Establishes the utility as a good actor and leader in the cause of water efficiency Costs Utility Costs Utility costs for water loss control vary. Initial implementation of the AWWA water loss audit methodology using the free software costs little more than a few hours of staff time. Taking this step then enables a utility to make sensible decisions about how best to allocate resources to water loss reduction. In some cases the first steps may involve improving the data used to calibrate the water loss accounting. The financial accounting elements included as part of the AWWA water loss auditing tool provide powerful decision support tools for water providers. The software examines real and apparent losses and associated costs and water values. This analysis provides clear information on how real and apparent water losses impact a utility s bottom line. For example, apparent losses from under-reporting meters are valued at the retail rate of water. Installing meters on unmetered accounts may represent a major water loss control activity that, in the long run, generates revenue for the utility. On the other hand, efforts to correct some types of loss will be expensive. For example, if a utility finds major infrastructural repairs are need, costs can be quite large. In all cases, cost-effective analysis should guide decision making. Customer Costs Utility customers do not have direct costs associated with water loss control. However, if large loss problems exist, customers will ultimate bear costs related to repair and replacement of infrastructure. Resources and Examples Resources Three fundamental resources are recommended as a starting point for those seeking to implement or improve a water loss control program: American Works Association (2009) Audits and Loss Control Program: Manual of Supply Practices (M36), American Works Association, Denver, CO available for purchase from 73

7 Aquacraft (2009) Utility Loss: A Review of Current Practices in Colorado, Requirements in Other States and New Procedures and Tools, Colorado Conservation Board, Denver, CO available for free download from AA139279CC44/0/16.pdf Free Excel-based water audit and loss control evaluation software developed by the AWWA Loss Control Committee. Free download available from r=48158 Journal AWWA (1996) AWWA Leak Detection and Accountability Committee, Committee Report: Accountability, Journal AWWA (July 1996): Examples The following examples come from the CWCB s Utility Loss: A Review of Current Practices in Colorado, Requirements in Other States and New Procedures and Tools (Aquacraft, 2009). City of Longmont Longmont tracks water loss on a multi-year basis. Longmont is promoting the term water loss in line with the IWA/AWWA standards. The calculation used by Longmont is system input measured at treatment less authorized consumption. Authorized consumption includes billed, metered accounts as well as unbilled metered accounts. Longmont reports that they are fully metered. losses in 2006 and 2007 were 8.3% and 8.2%, respectively. Losses have reportedly dropped since Line losses are assumed to be the major component of loss in the system, but this assumption comes from a process of elimination about other sources of loss. Main breaks are reportedly minimal, no accounts are un-metered, tests on replaced meters indicate that meter inaccuracy is not a problem, and changes to customer bills are handled without adjusting volumes recorded in the accounts database. Longmont staff also performs customer side leak detection, but generally, it is in response to customer concerns about unusual increases in consumption. Pueblo Pueblo uses the term unaccounted water. They define this as the amount of water pumped from treatment into the system minus the volume of billed water. The system is 100% metered. Losses are estimated at 6% to 7%. The biggest component of water loss in Pueblo is under metering. Although the system is fully metered, inaccuracies were the largest point of loss, officials said. Leak detection is performed on the system. This is sometimes done via contractor, but Pueblo also has the capability to do leak detection in house. They also do leak detection after mains are replaced. Pueblo collects readings monthly, but volumes do not necessarily match due to lags in billing data, etc. The primary metric is the yearly loss, but they also look at a five-year average of losses. 74