Water Audit Case Studies - The Emerging Use of Water Audits in the United States Water Utility Sector

Historically, the water auditing process has been in use inconsistently and sporadically in North America.  With the creation of the AWWA/IWA Water Audit Methodology and corresponding outreach by water utilities, a number of state and regionalWooden pipe from London in the 1800s. Water loss control has come a long way in recent years. water resources agencies in the United States have begun to embrace the methodology as an improved and reliable practice and as a standardized approach that can produce comparable data to allow performance comparisons and benchmarking of best practices on a national and international level.  Since 2005 annual water audit collection is required in a number of state and regional jurisdictions. Data submitted by hundreds of water utilities across the United States is becoming available for assessment.  Additionally, since 2011, AWWA has orchestrated an annual effort to collect and validate the data from several dozen volunteer water utilities.

Water Audit Data Validity

Water utilities and various water industry stakeholders are embracing the AWWA/IWA water audit methodology and many water utilities are now compiling a water audit on an annual basis.  Each year, many water utilities undertake the water audit process for the first time.  By employing the AWWA Free Water AuditSoftware©, a water utility can quickly assemble the audit from readily available data in a “top-down” manner. However, for many first-time auditors, the completeness and trust-worthiness of the available data is questionable.  This condition speaks to the issue of data validity.  While the audit can be completed and the performance indicators calculated quickly, how confident can the water utility manager be in those results if it is believed that much of the data entered into the water audit is of marginal quality? The quality of the water audit outputs (performance indicators) is only as reliable as the quality of the data inputs.

No water utility has perfect data, and all data are subject to some degree of error.  Data of low validity exists if the quantification method applied is cursory (such as use of rough estimates).  However, even data that is quantified in a robust manner can be low validity if the quantification is not kept up to date.  If the water auditing process is instituted as a standard, annual business practice a two-fold goal should exist to both compile the water audit, and to incrementally utilize detailed investigative “bottom-up” activities to improve the quality, completeness and timeliness of the water audit data.  Improved operations and water efficiency often also result as data quality improves.

In order to assess the data validity, or trust-worthiness, of water audit data the AWWA Free Water Audit Software© includes a data grading capability, and the calculation of a composite Data Validity Score, to rate the validity of the data. The Data Validity Score provides the auditor with context for next steps to improve the accuracy of the audit, as well as guidance for water loss control planning, target-setting and benchmarking.  In this way water utilities can assess both the water audit outputs and the validity of the data input to the water audit process.  The higher the level of confidence or validity of the input data in the water audit, the greater is the level of confidence in the resultant performance indicators and the development of loss reduction strategies.

The Water Audit Data Initiative (WADI) conducted by the American Water Works Association

Annually, starting in 2011, AWWA has organized several dozen progressive water utilities who have volunteered to submit their water audit data to the WADI process.  Once submitted, each utility undertakes a data validation process in conjunction with members of the AWWA Water Loss Control Committee.  The process keys on the water loss policies and practices as described by the water utility representatives in the context of the validity gradings assigned to the various components of the water audit.  The primary focus is the ensure that the individual data gradings and the collective Data Validity Score assigned by the AWWA Free Water Audit Software© are representative of the practices of the water utility. This effort is therefore noteworthy in that it produces one of only two validated water audit datasets in North America (the other being the State of Georgia water audit data).  The WADI data is available for free download in the AWWA Compiler Software© from the AWWA website at: http://www.awwa.org/resources-tools/water-knowledge/water-loss-control.aspx 

Water Audit Data Collection in United States State and Regional Water Resources Agencies

Particularly since the launch of the AWWA Free Water Audit Software© in 2006, a growing number of state and regional agencies are setting forth requirements for the annual submittal of water audit data from water utilities.  Below are descriptions of the efforts of several such agencies who have taken a leading role in collecting water audit data and assessing water loss standing in water utilities.  Additionally, other state and regional agencies are investigating the use of a standardized water auditing requirement.

State of Georgia

While debates over limited water resources are familiar to those in the western United States, competition over the water resources of the Apalachicola/Chattahoochee/Flint (ACF) River system in the Southeastern United States has reached epic proportions in recent years.  The controversy has centered on the rights of upstream users along the Chattahoochee River (mainly water from Lake Lanier in Northern Georgia supplying the Atlanta, GA region) and the needs of downstream users in Alabama and Florida for fisheries, power generation and the ecology.  The allocation of Lake Lanier water has been the focal point in this debate, and a federal court ruling in 2009 disavowed continued use of certain volumes of Lake Lanier water to the Atlanta area after 2013.  While some of the provisions of this ruling were later reversed upon appeal, the State of Georgia passed the landmark Water Stewardship Act in 2010.  Among the many requirements of the act is the provision that water utilities must compile an annual AWWA/IWA water audit, which started in 2012.  Control of water utility leakage losses is also given specific focus in the Act.

The State of Georgia’s program focuses not only on a rational structure for the program, but also dedicates considerable resources to the training and education of the water utilities, and validation of the water audit data submitted by the water utilities.  Its ability to leverage state revolving funds to assist these purposes is groundbreaking and highly noteworthy.  According to the Georgia Water System Audits and Water Loss Control Manual1, published by the Georgia Department of Natural Resources (GA DNR), the Georgia Environmental Protection Division (GA EPD), and the Georgia Association of Water Professionals (GAWP), the primary impetus for adopting a comprehensive water loss control regulatory system was the recognition that demonstrating strong stewardship of the state’s water resources would be very beneficial for improving water use efficiency in the face of potential shortages in many regions of the state. Water system audits and water loss control are considered valuable water management strategies that can improve the efficiency of water production and delivery within all water systems in the state.

The Georgia Environmental Finance Authority (GEFA) leverages state revolving funds for water efficiency purposes; providing funding for training, technical assistance, data validation, and water loss control grants to small systems serving less than 10,000 persons.  Grants are awarded depending on the level of water audit data validity, performance indicator values, and the utility’s ability to achieve a meaningful reduction in water loss.  With these functions in place, Georgia has ensured that water utilities are knowledgeable and active participants in the water audit data collection process and are fully engaged in launching efforts to better control losses. The Georgia Water System Audits and Water Loss Control Manual defines and describes best practices for compliance and improving water audit data validity, and provides guidance for use of the AWWA Free Water Audit Software© which is the defined method of data collection for the program.  Updated information and technical resources on the Water System Audit and Loss Control Program can be found at the GAWP website at www.gawp.org and on GA EPD’s website at: https://epd.georgia.gov/ga-water-system-audit-and-water-loss-control-manual

A structured data validation process was required in the Georgia program to ensure that all collected data was objectively represented in terms of its validity, but also as an additional educational process for utility personnel to become familiar with the integrity of their data sources and data management processes.  To accomplish this GA EPD implemented a third-party review process of all submitted water audits. For the first year water audits submitted by water systems serving 10,000 persons or more, a validation process was performed using contracted services of consultants versed in the water audit validation process.  The validation team interviewed the water utility auditors to review their data inputs, and the basis for their data grading assignments. Where applicable, water utilities systems submitted revised water audits, before GA EPD finalized and then posted the summary water audit data to their website. GA EPD is planning to continue this validation process with future water audit submissions prior to posting on the internet.  While the water audit data validation process demands additional resources of time and funding, this process is invaluable to the success of the water audit data collection process, as the assessments and judgments made about the results of the water audit are only as valid as the trustworthiness of the audit data inputs.  In its first two years of data collection the State of Georgia has validated data from over 200 Georgia water utilities.  This dataset, and the AWWA WADI dataset (26 utilities in 2014), represent the entirety of validated water audit data that currently exists in North America.  Hopefully the number of validated water audits will increase.

The State of Georgia has taken bold steps to emphasize water efficiency in all sectors as part of the long-term strategy for water sustainability in the Southeastern United States.  The State is also recognized for its progressive approach in the use of state revolving funds to provide training and validation services for the water utilities participating in the program.

State of Tennessee

The Tennessee Code Annotated (TCA) includes provisions for a regulatory system for water loss reporting and control adopted by the State legislature in 2007 (Public Chapter 243, HB 743).  The regulatory system is administered by the Comptroller of the Treasury - Utility Management Review Board, and the Water and Wastewater Financing Board.  These entities provide assistance to utility districts, municipal water systems, water authorities and county water systems; including establishment of guidelines for water loss reporting and control.  Similar to a public utility commission, the focus of the Utility Management Review Board is the financial protection of the water consumer.

The Tennessee Utility Management Review Board (UMRB) is charged with “…acting for the public welfare and in furtherance of the general assembly’s intent that utility districts be operated as self-sufficient enterprises.”  On October 7, 2010, acting under authorization of TCA Section 7-82-702, a Joint Meeting of the UMRB and the Water and Wastewater Financing Board (WWFB) established a percentage for excessive water loss at 35 percent using the then current method of calculation and required a transition in reporting and calculation methods for water loss.  Prior to January 1, 2013, subject to amendment of the TCA to allow the UMRB and WWFB to adopt water loss standards, water utilities were required to submit the original calculation method and reporting form for water loss.  If the system has excessive water loss, then it must resubmit using the AWWA water audit method.  On January 1, 2013 the AWWA water audit method became the operative protocol.  The term “unaccounted for water’ was removed from the TCA and replaced with “water loss” throughout.

A key stakeholder in the development of the Tennessee regulatory system for water loss control is the Tennessee Association of Utility Districts (TAUD www.taud.org).  TAUD recommended adoption of the AWWA Water Audit methodology for calculating water loss and an implementation strategy for compliance.

Water utilities regulated by the UMRB and WWFB are required to electronically submit annually the completed water audit via the AWWA Free Water Audit Software© together with the water utility’s audited financial statements.  The spreadsheet submittal is in addition to a single Reporting Worksheet which summarizes water treated and purchased, water sold and other authorized uses, and other financial information for revenues and electrical and chemical costs.

The audit information submitted using the AWWA Free Water Audit Software© includes the Data Validity Score determined according to data input gradings entered by the auditor as guided by the Grading Matrix within the Software.  Water utilities must demonstrate that their data validity score is:

  • greater than 65 for audits received between January 1, 2013 and December 31, 2014,
  • greater than 70 for audits received between January 1, 2015 and December 31, 2016,
  • greater than 75 for audits received between January 1, 2017 and December 31, 2018,
  • greater than 80 for audits received between January 1, 2019 and December 31, 2020.

A concurrent milestone-based requirement applies for demonstration of improved Non-revenue water (NRW) performance.  This performance is assessed using the performance indicator, NRW by cost, which is defined as the total cost impact of the NRW divided by the total annual cost of operating the water system.

  • NRW by cost greater than 30% through December 31, 2014
  • NRW by cost greater than 25% through December 31, 2016
  • NRW by cost greater than 20% through December 31, 2020

For this purpose, the total annual cost of operating the water system is defined to include all costs for operation, maintenance, debt service (principal and interest) and depreciation.  The thresholds are subject to change by approval of the UMRB and WWFB.

Failure by the water utility to submit the required audit information results in a referral to the appropriate board (UMRB or WWFB); as does a reported NRW by cost level which exceeds the designated standard and failure to achieve improvement in the Data Validity Score by the milestones noted above.  Referrals are primarily required to substantiate the financial viability of the water utility.   The referral is made by the Office of the Comptroller within 60 days of the failure to file or a filing whose results do not meet the designated performance standard.

It is important to note Tennessee’s progressive approach toward water utilities.  Instead of setting a low threshold for NRW which all water utilities should meet, Tennessee identified high threshold levels of water audit data validity and NRW by cost.  Water utilities that operate with parameters beyond these high threshold levels are referred to the appropriate authorities in order to help them gain the proper assistance to improve their performance in a focused manner.  This avoids a punitive approach toward utilities and ensures that needed attention is directed to the relatively few utilities that may be struggling to maintain acceptable water loss and/or financial performance.

TAUD has provided several workshops to assist water utilities with gaining knowledge of the applicable State policies and underlying principles of the AWWA water audit methodology, issues that arise in analyzing the data utilized for the audit, and the process for completion of the audit.

Additional information can be found at the website of the Tennessee Comptroller of the Treasury: Water and Wastewater Financing Board at: http://www.comptroller.tn.gov/wwfb/

Delaware River Basin Commission

The Delaware River Basin Commission (DRBC) oversees water resources for the longest undammed river east of the Mississippi River in the United States.  The commission members include the states of New Jersey, Pennsylvania, Delaware and New York, and the United States Army Corps of Engineers (USACOE).  The DRBC Water Code regulates water resources in cooperation with the member states and USACOE.  In 2009, after considerable research, the DRBC put forth revisions to the provisions of its Water Code regarding efficiency for water suppliers.  The revisions require submittal of an annual AWWA/IWA water audit from the 600 water utilities in the Delaware River Basin starting in 2012.  Information can be found at: http://www.nj.gov/drbc/programs/supply/audits/

The DRBC requires use of the AWWA Free Water Audit Software© as the data collection tool, and DRBC staff have taken a lead role in developing this software and complimentary tools for data analysis, including the AWWA Compiler Software.  Once routine water auditing is in place for the water utilities in the Delaware River Basin, the commission states will have a model on which to base similar requirements on a state-wide basis should they chose to do so.

The 2009 DRBC rule change required the AWWA reporting format to be used for the 2012 calendar year water audit and annually thereafter.  In the interval between the passing of the resolution and the implementation of the new reporting format, the DRBC promoted voluntary use of the new format and focused its efforts on raising awareness of the new approach and requirements through efforts such as:

  • Presentations and outreach to the regulated community
  • A one-day water audit training workshop held by DRBC in partnership with water utilities in the Basin.
  • New DRBC WebPages dedicated to water audits, hosting materials from the workshop and other supporting information.

The water audit requirement applies to all public water suppliers within the Delaware River Basin who have been issued approvals by the DRBC to withdraw and use in excess of an average of 100,000 gallons per day (gpd) of water during any 30-day period.   Through an extensive outreach effort, DRBC notified the regulated community, subject to the new Water Audit requirement, that the first report would cover the period of calendar year 2012 and would be due to DRBC by March 31, 2013, with subsequent reporting required annually thereafter.  An important aspect of the new DRBC water audit program was an emphasis on electronic reporting and processing of water audit reports.  As previously noted, the AWWA Free Water Audit Software© is the specified tool for water audit data collection and submittal and DRBC staff employ the AWWA Compiler Software© to assemble and analyze the data.

Prior to adoption of the new regulations, a 15 percent “unaccounted for water” performance standard was utilized by DRBC.  Until a sufficient body of data exists to indicate that a more meaningful measure of system performance can be established, DRBC will look at NRW as a key indicator of system performance.

In addition to compiling the annual water audit, water utilities distributing more than 100,000 gpd are required to develop and undertake a systematic program to monitor and control leakage within their system.  Such a program shall, at a minimum, include periodic surveys to identify leakage, enumerate NRW and determine the current status of system infrastructure, recommendations to monitor and control leakage, and a schedule for the implementation of such recommendations.

Each program to monitor and control leakage is subject to review by the applicable state agency where the water system is located and must be updated at a frequency not less than every 3 years.  A more frequent submittal may be required if NRW as percent by volume of water supplied exceeds 15 percent.

The DRBC has hosted workshops describing the revised regulations, including outreach to smaller water systems, and collaboration with state and local water industry organizations and training programs.  DRBC staff continue to lead the development of the AWWA Free Water Audit Software© and complementary tools and help to further institute the use of sound water efficiency practices for the water utilities of the Delaware River Basin.

California Urban Water Conservation Council and the State of California

The California Urban Water Conservation Council (CUWCC) has been an effective consortium of metropolitan water utilities and other stakeholders dedicated to the promotion of water efficiency in the United States’ most populous state.  The CUWCC is not a regulatory agency.  The CUWCC provides annual reports to the California State Water Resources Control Board and the governing bodies of the signatory water utilities on the progress of implementation of several Best Management Practices (BMP) relating to water efficiency.  Signatory water utilities agree to implement a series of BMPs for water efficiency.  In 2009 the CUWCC adopted a comprehensive water loss control initiative by revising its BMP 1.2 for water utility operations.  Under the revised BMP the CUWCC has defined a 10-year period for more than 230 signatory water utilities to establish routine and well validated water auditing, and to define and implement effective leakage control measures.  For information, access the below link and scroll to BMP 1.2:


The revised BMP 1.2 requires use of the AWWA/IWA Water Audit Methodology and the AWWA Free Water Audit Software© as the standard tool for compilation of water audit data by water utilities. For compliance under BMP 1.2, water utilities began to submit an annual water audit starting in 2010 for the 2009 year.  Through Year 4 (2013) utilities focused on improvement of the water audit data to establish a high level of data validity.  Years 5 through 10 (2019) focus on specific quantification of leakage amounts, and setting and obtaining meaningful leakage control goals.

Training in water auditing and the method of leakage component analysis for assessing leakage losses was offered to the signatory water utilities by AWWA and the CUWCC within the first four-year implementation period.  Funding of projects related to improved management of apparent and real water losses has been supported through other State programs, such as the Drinking Water Revolving Fund, as well as recent Federal programs intended to enhance economic recovery.

On September 19, 2014, the State of California amended Section 10631 of the State Water Code to require all urban water systems, including those not signatory to the CUWCC MOU, to quantify and report distribution system water loss using the water system balance methodology developed by AWWA.  Urban water systems are also required to include this information, together with descriptions of water demand management measures (including water loss management), in updates to their urban water management plans beginning with the 2015 plan updates which are to be submitted by July 1, 2016.  There are no water loss performance targets in the amended Section 10631 for water systems who are not a signatory to the CUWCC MOU.

The State of California is greatly challenged to achieve water sustainability for its long-term viability. Its challenges of limited water resources, drought, growing population and environmental stewardship place it at the apex of water efficiency imperatives.  The efforts of the CUWCC will assist greatly in promoting a more sustainable water future for the State of California.

State of Texas

Texas became the first state in the United States to pass legislation requiring water utilities to submit water audits (initially every five years) to the Texas Water Development Board (TWDB).  Over 2,000 completed water audits were submitted to TWDB for calendar year 2005.  TWDB requires submittal of standardized water audits using a Water Audit Worksheet, which is a forerunner of the AWWA Free Water Audit Software©.  Data from the initial water audits collected in 2005 was assessed and found that the quality of the data was suspect for many water utilities.  The findings were compiled in an engineering report titled, An Analysis of Water Loss as Reported by Public Water Suppliers in Texas.

As a result of the first round of data collection, the TWDB created a reporting structure that utilizes a data grading system (again another forerunner of the AWWA Free Water Audit Software© data grading capability).  However, the TWDB structure does not align with the system used in the AWWA Free Water Audit Software©, hence the Data Validity Scores of Texas utilities cannot be compared directly with those of the many other state and regional agencies that employ the AWWA tools.

The TWDB further refined its water audit guidelines in a manual that includes the capability to assess the validity of the data that is submitted by water utilities.  This 2008 manual can be downloaded at: https://www.twdb.texas.gov/publications/brochures/conservation/doc/WaterLossManual_2008.pdf

In 2013 Texas tightened its requirements for water auditing and loss control.  As a result of State legislation, (House Bill 3338 passed in 2003, and House Bills 857, 1461 and 3605 passed in 2013) utilities are required to conduct annual water audits to quantify water loss, to inform customers of water audit results, and to use a portion of state assistance funds in order to conduct conservation which can include water loss control. HB 857 requires water utilities to conduct annual water loss audits. HB 1461 requires customer notification of the audit results. HB 3605 requires utilities that receive board financial assistance to use a portion of that financial assistance to mitigate the utility's system water loss if, based on a water audit filed by the utility, the water loss meets or exceeds a threshold established by rule. These three bills were enacted during the year following the worst period of drought in the history of Texas.

House Bill 3338 was enacted to help conserve the state’s water resources by reducing water loss occurring in the systems of drinking water utilities.  In response to the legislation, approximately half of the public water utilities serving approximately 84 percent of the population in Texas reported their water loss data.  House Bills 857, 1461 and 3605 were enacted to request that utilities receiving any funding from the TWDB need to submit audits annually. Another objective of House Bill 3605 was to develop water loss thresholds. These had not been developed at the time of printing of this manual.

Any retail water supplier that is financially obligated to the TWDB and retail water suppliers that serve more than 3,300 service connections are required to file an annual water audit with the TWDB.  All retail public water suppliers are required to file a water audit every five years (the next audit is due on May 1, 2016 for the 2015 reporting year).  The TWDB encourages all retail public water suppliers to prepare an annual audit as a best practice for proactive identification and resolution of water loss management issues.

All public drinking water utilities are required to submit a water conservation plan which includes best practices relevant to water loss management.  These practices include supply metering with an accuracy of ± 5 percent, universal metering of both public uses of water, meter testing and repair, and periodic meter replacement, periodic visual inspections along distribution lines, and audits of customer service lines.  Additionally, public drinking water suppliers who serve or will, within ten years from the effective date of the plan, serve 5,000 or more persons must include a program of leak detection, repair, and water loss accounting for the transmission, delivery and distribution system, documentation of water pumpage, delivery, sales and loss volumes.  These plan requirements also apply to the wholesale customers of these systems.

The TWDB is a non-regulatory state agency.  However, failure to comply with the audit submittal requirements will preclude a water utility from receiving financial assistance for water supply projects.

The TWDB maintains a robust capability for providing technical guidance to drinking water utilities.  This capability includes staff consultation, web portals with considerable technical guidance (most also available in Spanish), an outreach program that includes workshops for water utilities – the content of which is eligible for licensure credits to water utility operators offered by the Texas Commission on Environmental Quality, and free equipment on loan for acoustical sounding devices for leak detection and pinpointing, and ultrasonic flow measuring devices to verify metered flow rates through source or master meters.

In early 2014, the TWDB discussed publishing a new Water Loss Reduction Implementation Manual which would include details of apparent and real loss management programs, and discussion of benchmarks and ranges of water audit data collected during the audit reporting program. Technical assistance can be accessed through the TWDB’s Water Conservation Division. Financial assistance for projects related to water loss control should be available in 2015 through low interest loan funding from House Bill 4 (2013) where up to $2 Billion of the Texas Rainy Day Fund can be used to provide low interest loans to aid with implementation of the state’s 50-year water supply plan.


1.  Georgia Department of Natural Resources, Georgia Environmental Protection Department, Georgia Watershed Protection Branch.  2014.  Georgia Water System Audits and Water Loss Control Manual, v1.1. 

More Information

Water Loss Control Introduction 

Water Audit Process Introduction 

Water Loss Control - What Can Be Done