Lost water revenue from wear on mechanical meters

Edited by the Processingtalk editorial team Aug 27, 2007

Cost / benefit analysis by the Village of Tinley Park, Illinois showed exactly how replacing mechanical water meters with SmartMeters would reduce existing revenue losses

In 2001, Severn Trent Services developed and introduced the SmartMeter SE700, a water meter specifically targeting the North American residential market.

Soon after, the village of Tinley Park in Illinois ordered the 5,000 intelligent meters and SmartPad devices to enable the water meters to be read remotely.

The village also ordered SmartReader handheld devices to read the newly installed SmartMeters.

Employing fluidic oscillation technology for lifelong accuracy, SmartMeter water meters are designed with no moving parts.

Because the meters are unaffected by grit and air in the network, metered flow and income data remain accurate over the entire product lifetime.

The leading edge water meters provide a range of functions to monitor leakage, supply data and prevent meter tampering, helping water companies optimise their networks.

Typical payback of SmartMeters is roughly three years, depending on the cost and quality of water available.

A few years after the initial installation, the village decided to undertake a detailed cost benefit analysis of replacing the remaining meters.

This consisted of two steps: a theoretical calculation of the loss of revenue from the mechanical meters, and an analysis of the actual earning performance of the SmartMeters compared to the mechanical meters.

THE TEST.

The Village removed a number of old mechanical meters to test their accuracy and establish the potential effect on revenue of a variety of replacement strategies.

A weighted analysis against typical consumption was undertaken on the removed meters.

Twenty percent of the tested meters had been used in low flow rate situations, 65 percent in average flow rate and 15 percent in high flow rate.

The 104 meters analysed ranged from four to 15 years in service, with an average of approximately 12 years.

The weighted average accuracy of the meter sample was found to be 89.3%.

Based on an average quarterly utility bill of USD71.97, this equates to a revenue recovery loss of approximately USD8.62 per meter per quarter or USD34.48 per year.

Assuming the sample is typical of the installed base, the theoretical revenue loss for the next 12 months was estimated at USD474,273 across the 13,750 meters subject to replacement.

The analysis of actual consumption figures highlighted the consistent performance of the SE700s in generating revenue compared to the consistent under-registration and progressive loss of performance of the aging mechanical meters.

As a result, the 5,000 SE700 meters installed by the Village all demonstrated consistent performance in earnings, while the accuracy and revenue generated by the mechanical meters dropped considerably over time.

Rather than focus exclusively on the initial capital cost, the Village also took into consideration the potential long-term whole life cost savings.

At USD474,273 in lost revenue over 12 months, Tinley Park would have experienced a loss of USD1,422,819 over three years, which is more than the cost of replacing all of the meters.

Compared to many municipalities, Tinley Park benefits from extracting its water supply from a high quality source, Lake Michigan, whose water is low in particulates.

Municipalities using mechanical meters and whose water source is of lower quality would experience even greater wear and higher revenue losses than Tinley Park.

After conducting the cost benefit analysis, The Village of Tinley Park elected to replace the entire installed base of mechanical meters with SmartMeters over the following three years.

Today, all the meters continue to show consistent revenue recovery.