Determinants of real water losses in the Australian drinking water sector

ABSTRACT

The Sustainable Development Goals (SDG) agenda calls for safe drinking water and sanitation for all communities around the world and the use of water in a sustainable and efficient manner. Although under less scrutiny in developed countries, network water losses can be a costly resource misallocation. This paper analyses real water losses in drinking water networks in Australia by applying a panel data regression model with fixed effects to ascertain the main drivers of real water losses. The results indicate population growth and water main breaks as major drivers of water losses in Australia. Real water losses also have an impact on utilities net revenue per unit water delivered, infrastructure leakage index and operational costs. In order to reduce real water losses, water managers and regulators must pay more attention to the health of the distribution network in the face of rapid urbanisation experienced in the east coast of Australia.

KEYWORDS:

• Non-revenue water
• water conservation
• utilities
• fixed effects
• panel data regression

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. The Millennium drought (1997–2009) is regarded as one of the worst droughts to hit the country.

2. NRW also has been conceptualised as to comprise three pillars of unbilled water use, apparent losses (commercial) and real (physical) water losses.

3. The Pearson correlation coefficient between these two variables was 0.84.

4. The percent water loss was calculated as the ratio of real water loss and total water produced.

5. The Hausman test statistics: ${\chi }^2=14.009$; df = 6, p-value = 0.029.