The Water Audit Process

A reliable water audit methodology was developed jointly by the American Water Works Association (AWWA) and International Water Association (IWA) in 2000.  The water balance of this methodology is given below and shows schematically the various components in which water volumes are tracked.  Terms and definitions are given in the table found at the bottom of this page.1 
  Water Audit Process 

Water Balance of AWWA/IWA Water Audit Methodology

The water balance tracks – from left to right – how a water utility supplies water volumes from source to customer, and provides the format for the utility to quantify amounts of billed and lost water.

The most convenient way for a water supplier to compile a water audit is by using the AWWA Free Water Audit Software© available from AWWA.  The software may be downloaded here.

 The software exists in MS EXCEL® spreadsheet software and is designed as a basic package that is useful for water utility personnel who aren’t familiar with the AWWA/IWA methodology.  If you work for a water utility, or are merely interested in the water audit process, you are urged to download the AWWA Free Water Audit Software© and begin entering actual or estimated data.2  AWWA also provides a companion software tool – the AWWA Compiler Software© which is also a spreadsheet software that allows the user to compile data from multiple water audits into a single spreadsheet.  This Software also includes capabilities to create charts and tables of the assembled data for analysis.

Fundamental to the AWWA/IWA Water Audit Methodology is the distinction that treated drinking water ultimately goes to two places: authorized consumption by consumers (its intended use), and a portion to losses (through inefficiencies).  Within the components of losses, two broad types exist:

Apparent Losses – are the non-physical or “paper” losses that occur in utility operations due to customer meter inaccuracies, billing system data errors and unauthorized consumption.  In other words, this is water that is consumed but is not properly measured, accounted or paid for.  These losses cost utilities revenue and distort data on customer consumption patterns.

Real Losses – are the physical losses of water from the distribution system, including leakage and storage overflows.  These losses inflate the water utility’s production costs and stress water resources since they represent water that is extracted and treated, yet never reaches beneficial use.

A fundamental concept of the AWWA/IWA Water Audit Methodology is that all drinking water can be accounted-for, via metering or estimation, as either a form of beneficial consumption or wasteful loss.  Hence no water is “unaccounted-for.”  It is recommended by AWWA to avoid use of the term “unaccounted-for” water, referring instead to the specific term “Non-revenue water,” shown in the above figure.  Additionally, the “unaccounted-for” water percentage – a simplistic measure of water not billed – as been found to be a very imprecise performance indicator and should also be avoided.  The most reliable assessments of Non-revenue water examine its extent in terms of the annual volume of losses and the cost impacts to the water utility.  The AWWA/IWA Water Audit Methodology features an array of robust performance indicators that are calculated in the AWWA Free Water Audit Software© for this purpose. 

How Prevalent is the use of Water Audits in the Water Utility Sector?

Historically, the water auditing process has been in use inconsistently and sporadically in North America and this represents perhaps one of the greatest shortcomings in an otherwise highly reliable utility services sector.  Many responsible utility managers compile at least a cursory water audit each year; however, without specific requirements, most of the thousands of North American water utilities conduct infrequent water audits at best, and therefore are likely suffering notable losses without being adequately cognizant of the actual volumes of lost water.  Since 2005, a number of state and regional water resources agencies in the United States have established water audit reporting requirements for water utilities.  These efforts have resulted in regular annual collection of hundreds of water audits in the format of the AWWA/IWA methodology.  Thus, the industry has begun to address the longstanding need to better establish accountability in its operations.


1.  AWWA. 2015 (forthcoming). M36, Water Audits and Loss Control Programs. 4th Edition. Denver, Colo.: American Water Works Association.
2.  AWWA, 2014. AWWA Water Loss Control Committee Free Water Audit Software, version 5.0.

More Information

AWE Water Loss Control Introduction 

April 2014 Water Loss Control Workshop (Presentations available for download) 

Case Studies - The Emerging Use of Water Audits Among US Water Agencies 

Water Loss Control - What Can Be Done? 

Water Balance Terms and Definitions

Water Balance Term 


Volume from Own Sources

The volume of water withdrawn (abstracted) from water resources (rivers, lakes, streams, wells, etc) controlled by the water utility, and then treated for potable water distribution

Water Imported

The Water Imported volume is the bulk water purchased to become part of the Water Supplied volume.  Typically this is water purchased from a neighboring water utility or regional water authority

System Input Volume

The annual volume input to the water supply system.  This equals the Volume from Own Sources plus the Water Imported volume.

Water Supplied

The annual volume of treated water delivered to the retail water distribution system. This equals System Input volume minus the Water Exported volume

Water Exported

The Water Exported volume is the bulk water conveyed and sold by the water utility to neighboring water systems that exists outside of their service area

Authorized Consumption

The annual volume of metered and/or unmetered water taken by registered customers, the water supplier, and others who are authorized to do so

Water Losses

The difference between System Input Volume and Authorized Consumption, consisting of Apparent Losses plus Real Losses

Apparent Losses

Systematic data handling error (in the customer billing process) all types of customer metering inaccuracies, and unauthorized consumption

Real Losses

The annual volumes lost through all types of leaks, breaks, and overflows on mains, distribution reservoirs, and service connections up to the point of customer metering

Revenue Water

Those components of System Input Volume that are billed and produce revenue

Non-revenue Water

The sum of Unbilled Authorized Consumption, Apparent Losses, and Real Losses.  Also, this value can be derived by calculating the difference between System Input Volume and Billed Authorized Consumption.