Illinois Water Audit and Loss Control Training Workshop
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Illinois Water Audit and Loss Control Training Workshop

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Illinois Water Audit and Loss Control Training Workshop




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Presentation on theme: "Illinois Water Audit and Loss Control Training Workshop"— Presentation transcript:

Slide1

Illinois Water Audit and Loss Control Training Workshop

Fall 2014

Slide2

RealLosses

ApparentLosses

UnbilledAuthorizedConsumption

BilledAuthorizedConsumption

Non-RevenueWater

RevenueWater

Leakage & Overflows at Storage

Billed Unmetered Consumption

Billed Metered Consumption

Billed Water Exported

Leakage on Service Lines(before the meter)

Leakage on Mains

Customer Metering & Data Inaccuracies

Unauthorized Consumption

Unbilled Unmetered Consumption

Unbilled Metered Consumption

Water

Imported

OwnSources

TotalSystemInput( allowforknownerrors )

WaterLosses

AuthorizedConsumption

WaterExported

WaterSupplied

IWA/AWWA Standard Water Balance

Slide3

Real Losses

Also called

Physical

Losses – water that enters the distribution system, but never reaches a user. Includes:

Leakage on transmission and distribution mains

Storage tank overflows

Service Line leakage up to customer meter

Reducing real losses creates an additional resource which reduces operating costs and can be used to defer capital expenditure

Slide4

Apparent Losses

Also called

Paper

or

Economic

Losses – water that reaches a user, but is not properly measured or paid for. Includes:

Theft

Customer metering inaccuracies

Data handling errors

Reducing Apparent losses increases revenue but creates no

new

water

Slide5

Non-Revenue Water (NRW)

Is the difference between the volume of water produced and the volume of water billed to customers

It consists of three elements with different values in $/gallon:

Real Losses

Apparent Losses

Unbilled authorized consumption (political losses)

Use this term instead of “unaccounted-for-water”

Slide6

RealLosses

ApparentLosses

UnbilledAuthorizedConsumption

BilledAuthorizedConsumption

Non-RevenueWater

RevenueWater

Leakage & Overflows at Storage

Billed Unmetered Consumption

Billed Metered Consumption

Billed Water Exported

Leakage on Service Lines(before the meter)

Leakage on Mains

Customer Metering & Data Inaccuracies

Unauthorized Consumption

Unbilled Unmetered Consumption

Unbilled Metered Consumption

Water

Imported

OwnSources

TotalSystemInput( allowforknownerrors )

WaterLosses

AuthorizedConsumption

WaterExported

WaterSupplied

Lots of new terminology

RealLosses

ApparentLosses

Non-RevenueWater

RevenueWater

Leakage & Overflows at Storage

Billed Unmetered Consumption

Billed Metered Consumption

Billed Water Exported

Leakage on Mains

Customer Metering & Data Inaccuracies

Unauthorized Consumption

Unbilled Unmetered Consumption

Unbilled Metered Consumption

Water

Losses

Slide7

Categorize Data

Leak on transmission main

Toilet leak

Straight pipe

Line Flushing

Leak adjustment

Wrong multiplier

Storage tank overflow

Flat rate accounts

Slow meters

Slide8

Game Time

Slide9

Common Pitfalls I

What did we learn the first time around

Slide10

What did you learn the first time around?

Time periods (production vs. meter reading)

Units (MG vs. 1,000 gal)

Financial calculations (include salaries?)

Default values (take a zero or the default percentage?)

Double counting (water exported should not be in billed metered)

Production meter calibration vs. accuracy testing (electronics vs. correct flow reading)

Slide11

Big Clues to Potential Errors

Check to see if you have a validity score

Failure to complete the audit grading scale fully will result in no calculated score

An ILI of < 1 (This is theoretically not possible)

An ILI of > 12

Very High Validity Score (>85) coupled with Very Low ILI (<2) after first audit

Slide12

Observations from Large System Audits

Reconcile period of water supplied with water authorized consumption

Billing period may be offset

Caution of negative ILI’s (more water consumed than supplied)

“Leaks and Breaks” do not go in unbilled unmetered – they are real losses

Average cost of real losses is usually less than cost of apparent losses (units $/1,000 gal for apparent losses, $/Million gallons for real losses)

Order of magnitude of losses (real is more than apparent, typically)

Slide13

Validity Scoring

Must meet/exceed all criteria to be eligible for the score

Don’t over/underestimate score

Must be defensible (explain why 8 was picked instead of 6)

Slide14

What did you learn?

Validity calls

Team meetings

Monthly tracking

Calculations workbook

Slide15

Common Pitfalls II

How to Avoid Falling in to the Trap

Slide16

Default Values

Provided for you in software

Calculated based upon a comprehensive review of systems during the development

Automatically receive a validity score of 5

Provided for 2 inputs

Unbilled unmetered authorized

Unauthorized consumption

Use them

Focus on a policy change to meter as much as possible even if it is not billed.

Slide17

Some Unbilled Unmetered Authorized

Fire UsesFire fightingTrainingHydrant testingSystem useFlushingTestingPlant use CleaningConstruction

“Political Loss” (if not metered)

Government buildings

Public amenities (fountains, parks, golf courses)

Landscape maintenance – Public areas (medians, tree plantings)

Not “leaks and breaks”

Slide18

Unauthorized Consumption

Illegal connections

Open bypasses

Misuse of hydrants

Meter tampering

Use of unmetered fire for service

Failing to notify utility when service is established and not receiving a bill

Focus on strong policies/practices and revenue recovery activities designed to mitigate this.

Slide19

Master Meter Error Adjustment

This is your production meters leaving the plant

Meter adjustment from verification testing, not electronic calibration

Should not be 0

If testing not performed, use 1% to 5% under-registration

Slide20

Customer Metering Inaccuracies

Considerations that determine accuracy

Physical accuracy to measure flow

Right-sizing

Correct type of meter for usage

Consider this the first step in consumption data gathering

All the other billing components and considerations are not a part of this input

Slide21

CMI – getting at the Number

Physical flow measurement

Meter testing data (Rep sample 10%)

Large meter testing

Residential testing programs

Weighted average of the data applied to appropriate consumption volume

Can use factory default if no testing program is in place (1% to 2%)

Slide22

CMI

The basis for all data gathering and input calculations arise from meter testing programs

Meter testing is not the same as calibration

Calibration should occur following the test to improve accuracy.

Utilize the sample of tested meters to extrapolate data across applicable category and size of meter

Field validation and billing system review coupled with testing and calibration will improve data validity and reduce apparent losses.

Slide23

Systematic Data Handling Errors

Everything else that happens between the meter reading and the bill.

Reading errors

Data entry errors

Estimated bills

Stopped meters

Adjustments to consumption

Black hole of customer accounts: (lost, not billed, not transferred)

Bad policies (Non-bill status, temporary builder accounts, etc.)

Slide24

SDHE

Should not be 0 – Validity Score Low

Flow chart billing process

Billing system staff and meter reading representative need to be involved

How do you begin to quantify

Reports (adjustment report, misread report, estimated bill report, stopped meters report, exception report, builder accounts report)

Policy review

Slide25

It’s the Money…

Financial Indicators

Won’t change your ILI

Will make this a useful tool for utilities

Clearly caused some problems

Already seized upon by the media “What’s all this lost water costing Illinois Citizens?”

Three Values

Total Annual cost of operating water system

Customer retail unit cost

Variable production cost

Slide26

Total Cost of OperatingWater System

What costs are associated with water system only in a combined system

If there is shared staff/equipment try to allocate a % to water

This still includes the chemicals, energy , pumping costs

Does include staff and depreciation

Combined Water and Sewer System Budget

Slide27

Customer Retail Unit Cost

THIS IS CALCULATED PER 1,000 GALLONS

What the CUSTOMER pays per unit of water billed to them (1,000 gallons or CCF)

Different rates (either customer class or tiers)

Weighted average – easier if you have 2-3 rates

Multi-rates simple calculation: Total annual revenue from water sold (not including tap/late fees) / total annual volume of water sold

If you bill in $/CCF you can use those units, but be sure to select them in the audit (or convert to $/1,000 gal)

Cost of apparent losses are calculated at this rate

Slide28

Multi Rate Calculation Ex.

Utility has 6 Rates $2.83-$8.25

Total Revenue for water sold $

kgal

$92,275,204

Total Volume Sold

kgal

19,453,210

$92,275,204/19,453,210

$4.74/

Kgal

Slide29

Variable Production Cost

THIS IS CALCULATED PER 1,000,000 GALLONS

The Cost of supplying the next gallon of water

For purchase systems this is the wholesale cost to purchase water (in $/MG)

If you treat drinking water this is: chemicals, power to treat and pump water (in $/MG)

If you have both it is a weighted average based on how much of each you supply your system.

Your water superintendents or financial staff should be able to provide these numbers

Check your work cost is much higher for purchase systems

Ex. If it is $.60/1,000 to produce VPC is $600.00

Ex. If it is $2.34/1,000 to purchase VPC is $2,340.00

Real losses are valued at VPC

Slide30

Variable Production Cost

Groundwater systems are typically $150-$500 per MG

Surface water systems are typically $500 - $1,500 per MG

Purchase systems are typically $1,500 - $3,000 per MG

If you are outside these ranges, check your units!

Slide31

This is your workshop

What did you find?

What can we clarify?

What were your biggest issues?

Slide32

Understanding Validity

Are my numbers valid?

Slide33

What do those scores mean?

Each data input has a “Data Grade” that is used to calculate your overall audit “Data Validity”

For each input, there are criteria defining each Grade

If you meet or exceed all criteria in a score, go up

If you don’t meet at least one of the criteria, even if you exceed all others, go down

Slide34

What does my grade mean?

Be realistic and truthful

There will be specific actions that can be taken to improve data grade

The grades are “weighted” in the calculation of overall validity score

Priority areas of attention are based on their importance and effect on overall validity when modified

Slide35

Examples

Slide36

Is my grade good or bad?

There is no good or bad, only high or low

Don’t compare yourself with others, only yourself

Identify areas to improve your grades “that make sense” (financially)

Slide37

AWWA Water Audit Software - Grading Matrix

Slide38

Game Time

Slide39

Do People Really Care?

Press – Want a story “wasteful local utility”

Elected Officials – Want “CYA” when press and environmentalists call

Environmentalist – Want “0 loss of a precious resource” Believe it is possible.

Utility Staff – Want to know “what to do with this”

Citizens – Are surprisingly busy

Slide40

What’s Your Biggest Fear

Slide41

No One Understands

Water Loss is complex

Technical

The word loss (no way this is positive)

Up on the web

See it like they do

A way for accounting for our water

Where did it go?

How much did that cost?

Can I stop it?

Slide42

Up on the Web

????????

What is going up: Validity score, ILI, 3 areas for improvement listed at bottom of audit

Slide43

We Don’t Look so good

System to system comparison

Human nature

It will happen

Message should always be about your utility

Turn the ship back to building a better utility

You got a D

Focus on next steps

How you are moving forward

Don’t focus on what you are missing

What are you gaining

Slide44

Unavoidable Loss?

How citizens see us delivering water

How we think about delivering water

Slide45

Bridge the divide

Not a technical discussion

It is a scale discussion

Volume: millions of gallons

Delivery mechanism: miles of pipe

Visibility: underground

Environment: Changing elevations, roads built over it, soil changes, climate influences

Frame it

using

your utility

Slide46

It’s all New to Me

This could work in your favor

We tend to get too technical

Do not drown the utility in

a sea of acronyms and water words

As we learn we are on a more level playing field

As we gain knowledge we are having to share it with our colleagues

We don’t have the shorthand yet

Slide47

Spin the Message

In tough economic times you are looking at non-revenue water

Water that is not returning money to the utility

Looking at internal efficiencies and policies to get the most value from the water supplied

This can be two-fold message

Financial value

Environmental value supply-side conservation

Focus on what you are doing

The audit informed the utility’s efficiency efforts

It did not end there

Everyone can do something

Evaluating policies and procedures

Increasing internal departmental coordination

Looking at processes – All free

Slide48

Common Questions

How does your system compare?

Why is our validity score so low?

What are you going to do about all this water?

How much is this costing/Rates

Why do you need a reservoir you are losing millions of gallons of water?

Slide49

Resources

IEPA

ISAWWA

IRWA

Talking Points Handout

E-mail of the Common Questions we completed in class?

Slide50

Resources

Slide51

Slide52

Slide53

Metering and Accountability Policy Statement

Slide54

Asset Management Policy Statement

Slide55

Slide56

Methods to Reduce Real Losses

Slide57

Methods to Reduce Apparent Losses

Slide58

Benchmarking

Go to website…

Slide59

Benchmarking participants 2012

Slide60

Benchmarking

21- 26 Water Systems in the last 3 yrs.The National dataset only actively validated dataset with a 3 yr. history

Slide61

Benchmarking

21 -26 Water Systems

Slide62

Benchmarking

21 - 26 Water Systems

Slide63

Open Discussion

What did we miss? What else do you want to discuss?

Slide64

Frequently asked questions

What will be done with the audits?

What does my audit mean?

Am I doing well?

Is there room for improvement?

Is it worth it to get my score from 8 to 9?

What do I do next?

How can I reduce losses?

What is the payback?

Slide65

Contact us anytime!

IEPA

ISAWWA

IRWA

????

Slide66

Illinois Water Audit and Loss Control Training Workshop

Fall 2014