THE REGULATORY HAMMER
With over 92 percent of California in severe, extreme or exceptional drought affecting over 36 million people,1 water remains a critical issue for the state. And in response, the California waterscape will continue to increase in complexity for water utilities as nervous government officials attempt to understand the future of water in the state through growing reporting and oversight requirements.
One such oversight was added on 9 October 2015, when Senate Bill No. 555 was approved by the Governor. SB 555 adds Section 10608.34 to California’s Water Code, which requires “each urban retail water supplier, on or before October 1, 2017, and on or before October 1 of each year thereafter, to submit a completed and validated water loss audit report for the previous calendar year or previous fiscal year.”2
In conjunction with the Governor’s Executive Order B-29-15 (1 April 2015)3 and the State Water Resources Control Board Resolution No. 2015-0032 adopting an Emergency Regulation for Statewide Urban Water Conservation (5 May 2015)4, SB 555 represents another regulatory directive to ensure that California’s urban water suppliers are being proactive with respect to managing water resources.
While SB 555 is one of several regulatory vehicles put into place in California, it is also rather unique. Instead of simply providing guiding principles for urban water suppliers to demonstrate and report on conservation activities, SB 555 defines the methods to be used to determine water loss.
The goal here is to ensure that all water suppliers are using comparable methods and practices, in order to allow meaningful comparisons and contrasts to be developed, and ultimately to standardize the evaluation process in advance of statewide performance standards for volumetric water loss. It should be noted that while there is no standard proposed in SB 555, the State Water Resources Control Board (SWRCB) is required to adopt water loss performance standards by 1 July 2020.
SB 555 requires that urban water suppliers conduct standardized audits of water loss for their systems “in accordance with the method adopted by the American Water Works Association in the third edition of Water Audits and Loss Control Programs, Manual M36 and in the Free Water Audit Software, version 5.0.”5
Clearly, California’s urban water suppliers need to get leakage under control. Unfortunately, not only will they need to spend money to fix the source of the problem, they will also have to absorb the administrative costs of SB 555. In the absence of offsetting revenue enhancements, this may further negatively impact the already strained financial condition of the water suppliers, who are still trying to compensate for the revenue losses as a result of the state’s mandated 8 to 36 percent potable water conservation requirements.6
Adding even more costs of this program, SB 555 also requires that the data used to populate the water loss report be validated by “a technical expert to confirm the basis of all data entries in the urban retail water supplier’s water loss audit report and to appropriately characterize the quality of the reported data.”7
While some large utilities will have access to their own staff with the technical expertise to validate their own water loss audit report validation, as allowed by Water Code §10608.34 (a)(1)(D), many water suppliers will be required to seek outside or consultant support for these services. As a result, designing a water loss control and monitoring program that minimizes the use of outside support will be critical.
While SB 555 does seek to offset some of the costs associated with water loss reporting through a $400,000 appropriation, for the State’s 414 urban water suppliers, that’s an average of less than $1,000 per supplier. The water suppliers are in the line of fire for the rest of the bill.
DATA IS YOUR BEST DEFENSE
The basis for the AWWA water loss audit method is identifying and segmenting water—an activity that is very data intensive. To be effective, a utility needs to be able to gather data from SCADA systems, asset management systems, financial systems, billing systems and meter data management systems. Unfortunately, in many utilities, these data systems exist in silos in various departments with very little integration—which means that much of the data needed to meet the dictates of SB 555 will have to be manually collated.
Compounding the issue is that a number of inputs required by the AWWA Water Audit Software are not known—or even easily determinable—by many utilities. The AWWA Water Audit Software also requires significant approximations and generalizations that can limit the effectiveness of the tool.
For example, one input value is the overall customer metering accuracy of the metered population. As we discussed in the last issue of FATHOM Drought Watch: Rescuing Revenue,9 the accuracy of meters is not simply one number. Choosing an incorrect number can dramatically shift how the utility may interpret the results. As such, utilities should ensure that the data used in the AWWA Water Audit Software is accurate—otherwise resources in our already financially constrained industry will be wasted.
YOUR SECRET WEAPON
While the AWWA Water Audit Software compensates for these issues by through a user-defined value representing the confidence associated with specific inputs, it is clear that the results are only as good as the data provided. To achieve a high level of confidence in the data, utilities must adopt automated systems. The tool itself notes the following criteria to attain the highest level of confidence:10
Billed Meter Volumes
Purchase and install meters on unmetered accounts. Launch Automatic Meter Reading (AMR) or Advanced Metering Infrastructure (AMI) system trials if manual meter reading success rate of at least 99% is not achieved within a five-year program. Continue meter accuracy testing program. Conduct planning and budgeting for large scale meter replacement based upon meter life cycle analysis using cumulative flow target. Continue annual detailed billing data auditing by utility personnel and conduct third party auditing at least once every three years.
- Low Flow Rate
Meters have specific flow ranges over which a new meter can be expected to be very accurate. At low flow rates though, meter accuracy can decline rapidly. While low flow performance varies by meter size, type and manufacturer, typically flows less than 0.125 gallons per minute for small residential meters and 1.5 gallons per minute for larger commercial meters are recorded with very low accuracy. In situations where vast differences between minimum and maximum flows are expected, then typically a compound meter that incorporates a large and small meter into a single assembly is installed.
- Customer Information
Water utility billing is often the basis for billing additional services such as refuse and sewer. Often it is also subject to spatially-driven charges such as pump station surcharges, pressure surcharges and fire protection fees. Ensuring that accounts are being billed for these additional services as well as understanding where each meter is located with respect to these spatial boundaries is critical to ensure the correct revenue is collected from each customer.
To minimize water loss, utilities need to know where the water was, is and where it will be. It is imperative to focus first on getting the data right before committing to more expensive leak rectification methods. In fact, studies have shown that as much as two-thirds of non-revenue water is not physical leaks, but errors in the data.11
Advanced Metering Infrastructure (AMI) along with the FATHOM Solution Suite of water management tools directly support these activities. The geospatial FATHOM Meter Data Management platform plugs the utility’s data leaks, allowing for maximum automation of the data validation process and ultimately compliance with SB 555 at minimum cost. Most importantly, FATHOM finds lost revenue in this data, providing utilities with the financial capability to adapt to decreasing revenues as a result of conservation.
With FATHOM, utilities Fix Data First; Leaks Later. The result is a program meeting the requirements of SB 555 and establishing the utility on a platform of efficient water loss—and revenue—control.
1http://droughtmonitor.unl.edu/Home/StateDroughtMonitor.aspx?CA (accessed 23 October 2015)
2Senate Bill No. 555 CHAPTER 679 https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201520160SB555
5Senate Bill No. 555 CHAPTER 679, Op cit.
6FATHOM Drought Watch, Paying Your debts, Volume 1, Issue 18, 7 August 2015 (http://www.gwfathom.com/wp-content/
7Senate Bill No. 555 CHAPTER 679, Op cit.
9FATHOM Drought Watch, Rescuing Revenue, Volume 1, Issue 27, 9 October 2015 (http://www.gwfathom.com/wp-content/
10AWWA-WAS-v5-09152014, Grading Matrix Tab
11Ramli Mattar, “Kahramaa’s vision for non-revenue water reduction”, Water Utility 21, April 2013.