Program Needs and Requirements for Water Loss Control

According to American Water Works Association (AWWA) estimations, approximately $325 billion needs to be spent on upgrading distribution systems in the United States in the next 20 years.11 Using average demand figures, the annual value of lost water and revenue, and therefore the approximate annual value of the water loss control market in the United States and worldwide, can be approximated. Interestingly, water loss control is estimated at approximately 29% of the above AWWA figure, or $94 billion. These estimations can be found in Table 2.2 and are approximations only. However, even if in error by 50%, this finding represents a huge, virtually untouched potential market that exists for water

Awwa projects that $325 billion needs to be spent on water system upgrades in the United States over the next 20 years.

U.S. market potential

U.S. population


Average consumption (kgal/year)


Average loss


Split of real losses


Average cost treated


Average cost sold


Recoverable %


Total losses


Total real losses (kgal/year)


Total apparent losses


Value of recovered product

$ 2,190,000,000

Value of recovered revenue

$ 2,336,000,000

Recoverable %

$ 1,642,500,000

Recoverable %

$ 1,752,000,000

Market size per year

$ 3,394,500,000

Simple calculation for world market size

Assumes like numbers as

Other countries use less but with high loss

U.S. water is cheap compared to others

Loss value per capita in United States

$ 13.58

World population


World market size per year

$ 81,468,000,000

Table 2.2 Approximate Value of Water Loss Control Market

Table 2.2 Approximate Value of Water Loss Control Market loss control; which can be approached by water system operators, consultants, contractors, plumbers, and facility managers.

A complete water loss control program is often referred to as a Water Loss Optimization Program. Optimizing basically means doing everything possible to improve the technical and financial performance of the water system, whether a public, private, or demand-side system. Optimization usually entails reduction of operating overheads and enhancement of revenue streams. Figure 2.1 shows a typical optimization graph. In this case it can be seen that the profitability in the beginning is low as the cost of the water loss project is being borne on a performance basis.

Water System Optimization

Sustainable solutions for improving water system performance

Optimized revenue


Profit No intervention

Intervention cost .

■. L Overhead Optimized overhead


Figure 2.1 Sustainable solutions for improving water system performance.

Water loss optimization programs are sometimes undertaken on a performance basis. This means that the utility enters a special partnership agreement with a contractor or consultant. The contractor or consultant is paid a portion of the money recovered from the project over a certain time frame. This is an excellent way of undertaking a project, especially for utilities that do not have a substantial initial budget to allocate for loss control, but do have an existing operating budget, which includes a fixed cost to operate the system with losses. The performance approach allows the utility to continue budgeting their normal allocation, however the actual cost of operation will drop and the revenue stream increase as the work continues. At a certain point the contractor drops out of the equation and the annual operating budget either reduces with an increased income, therefore profitability; or the additional funds can be redirected into other maintenance or training functions as required.

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