What if you didn't get paid for 25% of your work, or in the case of South African municipalities, 41% of your work? This percentage is approximately the amount of non-revenue water generated by local towns and cities, water that cost-wise goes straight down the drain.
"Water represents a major revenue source for municipalities," explains Chetan Mistry, Marketing and Strategy Manager for Xylem Africa. "In the United States, water revenue is second only to tax when it comes to municipal income. It's pretty similar across the globe. So, when you have a high percentage of non-revenue water, you are losing a lot of revenue."
Non-revenue water (NRW) - also called water conservation and water demand management - is water that's lost before it reaches a commercial consumer or remains unbilled due to leaks, poor metering, theft, and other unaccountable losses. South Africa's NRW situation is quite dire. The global best practice for NRW is 15%, and the average sits around 35% (2030 Water Resources Group). Yet roughly 41% of South African water is NRW.
Numerous studies have identified the problems and strain caused by NRW. There is a general acknowledgement that SA's approach to its water infrastructure had aggravated matters. NRW is most common among existing infrastructure, whereas the state has put the focus on new infrastructure. This approach removed many incentives for municipalities and investors to focus on maintaining older systems.
Yet, new infrastructure doesn't tackle the various factors that create NRW. Many reports and experts have called for systemic solutions that focus on what is already out there. Can we achieve those goals?
NRW is a challenge in many parts of the world, including first world economies. Decaying infrastructure and poor management of water revenue streams are root causes for NRW in most countries, says Mistry:
"Non-revenue water often results from a lack of oversight and data gathering, such as unread meters or misreported meters readings. Leaks are another cause of water revenue losses, though it's not always the highly visible leaks. When those appear, the underlying issues and revenue losses have been perpetuating for some time. Often, an unidentified small leak can lead to larger infrastructure failure as it denotes deteriorated pipe conditions that might collapse. On critical lines this may mean days without water as the infrastructure is repaired, compounding the losses."
Five steps to reduce NRW
Papers such as Counting the lost drops: South Africa's study into non-revenue water and work by the State-owned Development Bank of Southern Africa (DBSA) push for systemic solutions. In general, the steps to remove NRW are as follows:
NRW's low-hanging fruit
By using a combination of modern management and maintenance technologies, the gains are incredible. Singapore, which runs the world's largest smart water network, has reduced NRW losses to under 5 percent. When the city of Milan in Italy scrutinised its main pipelines, it quickly found over 20 major leaks that traditional methods would never have detected. And in Colorado, advanced leak and stress detection canvassed an 80-kilometre pipeline in under a day, revealing numerous stressors before they turned into leaks.
If you want to score some quick wins against NRW, there is a clear place to start. Quantity-wise, commerce and industrial customers represent about 5 to 15 percent of a municipality's utility customers but 35 to 60 percent of overall revenue. NRW projects should focus on those customers, specifically whether their usage is adequately monitored. Doing so will encourage the adoption of best practices.
Locally, municipalities can use the No Drop scorecard from the Department of Water and Sanitation (DWS) and the Strategic Water Partners Network SA (SWPN) to encourage a better management culture and have an incentive to pursue NRW properly. The DBSA's project aims to create a centralised and structured approach to NRW, similar to local independent power producer management.
"Current research and best practices all agree on the best approaches to the problem and how to tackle it, and modern technologies make it much easier and more affordable to put the right systems in place across existing networks. For example, metering can be used to check water during its journey – check points such as pressure sensors can identify potential leaks. If municipalities combine best practices with good management, they can make gains quickly and unlock a lot of lost revenue," says Mistry.
Every day, towns and cities throw away around 40% of their water revenue through non-revenue water. This gap represents an incredible opportunity for the budgets of struggling municipalities. If we can get on top of this challenge through systemic and collaborative efforts, it could significantly improve the fortunes of South African communities everywhere.