Performance improvement planning : designing an effective leakage reduction and management program

One of the principal concerns today for the deteriorating quality of water supply and sanitation services in India is the high levels of nonrevenue water (NRW)—the difference between the amount of water put into the distribution system and the amount of water billed to consumers. High levels of NRW result from huge volumes of water lost through leaks or water not invoiced to customers or both, and this seriously affects financial viability of water providers through lost revenues, increased operational costs and, eventually, increased capital costs. Reducing nonrevenue water levels does not necessarily compromise on a service provider’s ability to subsidize services for the poorer sections of the population; rather, it allows for improved transparency and accountability, and for ensuring better targeting of subsidies such that they are more equitable and actually reach poor people.
Reducing NRW and maintaining it at target levels is hence an important task for any service provider looking to improve quality of service, financial soundness, and creditworthiness.
This field note captures the core principles for the effective implementation of nonrevenue water programs through real world examples of service providers implementing such programs in India and Vietnam. The case studies demonstrate that successful leakage reduction and its effective and sustainable implementation has not been a result of erratic and irregular technical exercises to reduce physical losses. On the contrary, these nonrevenue water programs are successful because of their continuous effort to control physical and commercial losses while also bringing in managerial efficiency and institutional accountability.