Plugging water network leaks with smart technologies
Ageing and leaky water systems are in urgent need of an upgrade, presenting opportunities for innovative solution providers and utilities alike.
Scarcity is a present and escalating crisis amid more volatile rainfall patterns and rising water consumption. Regions home to half the world’s population now face severe water stress for at least part of the year1. Yet worldwide, an estimated 30% of treated water is lost2 before it reaches the tap.
In this context, water utilities are under increasing pressure from regulators – and the public – to improve the efficiency of their networks. They have financial incentives to do so, too.
Water utilities now plan a wave of investment to upgrade ageing infrastructure. We believe this should provide structural long-term tailwinds for technological solutions that help utilities identify and predict – and so quickly repair – leaks.
- https://www.unesco.org/en/articles/united-nations-world-water-development-report-2024-water-prosperity-and-peace
- https://www.globalwaterintel.com/articles/plugging-the-leak-innovative-solutions-for-reducing-water-loss-and-it-s-economic-impact
Regulatory and financial pressures to stem losses
To meet rising demand and address risks posed by climate change, the World Bank has estimated that roughly US$1tn a year3 needs to be invested this decade to improve the resilience and sustainability of the world’s water infrastructure. Much of this needs to be directed towards upgrading and fixing ageing networks.
Losses from distribution networks are driven by a combination4 of old pipes (one-fifth of pipes in the US and Canada have exceeded their useful lives), shifting ground conditions (often due to extreme weather) and the inherent challenge of monitoring thousands of kilometres of buried assets.
Regulatory frameworks increasingly mandate and reward greater water efficiency. For example, water companies in England – where there is a goal to halve leakage by 2050 – face financial penalties if targets are not met.
Rising to these demands imposes costs on water utilities, but fixing leaks should be less expensive than the alternatives. Unless the efficiency of distribution networks is improved, additional water storage and treatment infrastructure would be needed to meet rising demand from consumers and water-intensive industries such as datacentres.
Targeted investments to stem losses of treated water should be highly cost-effective. The largest listed US water utility, American Water Works5, expects its programme of water-saving projects to yield up to US$1.5bn in annual savings by 2030.
- https://blogs.worldbank.org/en/water/closing-the--7-trillion-gap--three-lessons-on-financing-water-in
- https://digitalcommons.usu.edu/water_rep/682/
- https://usa-works.org/usa-jobs/investing-in-u-s-water-infrastructure-navigating-a-1-trillion-opportunity/
Identifying and predicting network leaks
Among the advanced technologies being adopted by water utilities, four stand out. We expect demand for each to rise as utilities ramp up investment in their networks.
The first technology is smart metering. These devices provide real-time data that helps utilities identify anomalies including continuous flow – often an indicator of a hidden leak – in homes and other points of consumption. This allows them to pinpoint leaks and repair them quickly.
A UK-listed utility that supplies water to over 8mn people6 is installing one million smart meters as part of a £13bn investment programme for 2025 to 2030. Having reduced leakage by 29% since 2005, despite population growth of 22%, the company is looking to accelerate the rate at which it identifies and then tackles leaks.
Two additional monitoring technologies are being widely adopted by water utilities: acoustic listening devices and satellite leak detection.
The former are sensors that ‘listen’ for the sound of escaping water and so, like smart meters, can help pinpoint leaks in real time. A utility that supplies roughly 7mn people in northwest England7 has installed over 72,000 acoustic loggers to reduce network losses.
Synthetic aperture radar satellite technology is being used to detect underground leaks across entire networks. Radar signals penetrate up to three metres below the ground to recognise abnormal levels of soil moisture. When overlaid onto a network map, leaks can be identified precisely.
Monitoring hardware is increasingly being used as inputs for advanced ‘digital twins’ of real-life systems. A US utility that provides drinking water and wastewater treatment across 14 states has segmented its network into ‘virtual district metering areas’. Using data from smart meters, leaks can be detected by abnormal and persistent spikes in flow, enabling their swift resolution.
Further, maintenance is shifting from reactive towards predictive. By analysing pipe age and historical break data, AI-powered software can predict which sections of the network are most likely to fail, allowing more effective prioritisation of repairs – before they lead to water losses.
- https://www.stwater.co.uk/news/news-releases/
- https://www.unitedutilities.com/corporate/responsibility/our-approach/leakage-performance/
Smarter, more resilient water infrastructure
The regulatory and financial incentives for utilities to invest in smarter, more resilient water networks combine to forge a constructive environment for suppliers of these innovative solutions.
It supports opportunities for leading consultants with whom many utilities partner to integrate and operate advanced hardware and software solutions.
For the utilities themselves, those that effectively leverage innovation to improve network efficiency should avoid regulatory censure and alleviate pressures to make more costly infrastructure investments.
As the environmental and social costs of water mismanagement come into closer focus, we believe this trend supports demand growth for products and services that help plug leaks and strengthen the overall resilience of water systems.
This is an edited version of an article provided by Impax Asset Management. It has been published as https://impaxam.com/insights-and-news/blog/smart-technologies-plugging-water-network-leaks/
BNP Paribas Asset Management has delegated the management of selected funds to London-based investment partner, Impax Asset Management Ltd. Impax is a specialist asset manager focused on investing in the transition to a more sustainable global economy. Impax’s highly experienced, multi-disciplinary team has grown organically since inception. The team is made up of individuals with diverse backgrounds, bringing together complementary skills and experience, which adds depth to the investment process.
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