by Steve Birndorf
So, I’ve been thinking about broken meters quite a bit lately (and, when I say “broken meter,” I’m referring to all sorts of different issues--under-registration, non-registration, decay, stuck meters, zero reads, etc.). Every day, as I talk to municipalities and water agencies around California and around the country, broken meters are a topic of universal importance and concern. Everyone’s got ‘em, and everyone is trying to get rid of ‘em. And, broken meters don’t just go away when you fix them...they are a recurring problem which occur year after year after year...
Broken meters, significantly impact water utilities. They leave revenue uncollected, they impact revenue stability, they make compliance difficult, they result in truck rolls, they impact conservation efforts. The list goes on.
Meter Asset Management 2.0
While most utilities have meter replacement programs in place, these programs tend to be unscientific and based on arbitrary parameters--geography, age, or pressure zones. Or, maybe, meters are replaced once they die and a zero-read is detected. Many utilities will simply replace a subset of meters wholesale every year, regardless of meter functionality. A utility with 100,000 meters might replace 5,000 meters a year over a 20 year cycle, assuming 20 years to be the useful life of a meter. Maybe some statistics are sprinkled into the program, but typically, meter replacement is a guess at best. I’m certainly not judging in my observations--utility managers know that lost revenue from meters are a problem and they work very hard to address this known problem. But, historically, there haven’t been tools (or analytics!) to surgically identify and replace faulty meters with issues while leaving working meters in service. Management does the best with the tools that they have, but most agencies will freely admit that their programs are rudimentary, and *all* wish that they had better tools to pinpoint broken meters.
EBMUD Study on Unbilled Water
Dave Wallenstein, an engineer and meter expert at East Bay Municipal Water District (EBMUD) in Oakland, CA, recently presented a study at the Water Smart conference in Las Vegas in 2016. EBMUD needed to replace a group of about 500 meters, and Dave decided to use this opportunity to bench test these meters and test for accuracy. The meters were all 5/8", but of different ages, in different locations and from different manufacturers. The goal of the study was to evaluate the condition of current meter fleet, identify problem meters, and to quantify potential revenue recovery.
Dave pulled these meters and bench tested each. The findings were incredible. Based on bench testing, these meters were under registering between 4% and 7%, depending on flow rates. Wow! And, even more striking, after replacement, and after three years of being placed in service, these new meters registered 8% more consumption relative to the replaced meters. Eight percent! Can you imagine if you owned a coffee shop, and for every $3.00 latte you sold, you only collected $2.76? Customer after customer, year after year after year. My guess is that you fix that cash register, post haste!
And, don’t forget, this 8% loss is an average across 500 meters. Some meters were registering at say 15%, others at 95%. There was a distribution of degradation. This distribution highlights one of the most significant issues around meter replacement programs. When meters are replaced at random, many meters which work great are replaced (even old ones). And, many meters which are compromised might not be in the current batch of meters scheduled for replacement. They may be scheduled for replacement in a year, five years or 20 years. Dave observed this phenomenon in his study--many older meters worked great, and many younger meters were broken. Imagine how much revenue goes uncollected when a meter breaks in year five and is not replaced for 15 more years.
Data analytics and information analysis offers a huge opportunity for utilities to identify broken meters, quantify revenue loss, and proactively replace meters in an organized and prioritized way. What if you could identify only the meters that had problems? What if you could precisely pinpoint the top offenders across your entire system...in real time?
Toward Greater Financial Sustainability
In one study that we conducted with a customer with 76,000 meters, we found that 4% (both residential and commercial) had under-registration issues. We calculated that there was approximately $1.5M in revenue that could be potentially recovered. If you ONLY replaced the meters that had issues, you would recover about $375 per meter! And, you’d roll fewer trucks, you’d nip decaying meters in the bud, and you’d recover revenue. A lot of revenue. Revenue that you are entitled to, but don’t collect. Because your cash registers are broken.
In the past few years, this is a problem that has finally started to get attention within the industry. Increasingly, through the use of sophisticated data analytics, water utilities can now pinpoint broken meters. Valor software, for example, can not only identify which meters are likely broken, but can also quantify the revenue impact from those meters being broken This is the key to optimizing the amount of revenue recovered per meter. By focusing on those meters which have the greatest revenue recovery potential, and leaving the rest of your meters alone, you'll spend your time and resources effectively.
Steve Birndorf is Valor Water's Vice President of Sales.
Steve is a veteran sales professional with significant finance, consulting and business development experience. Most recently, Steve formed a commercial solar group for a large privately held integrator, where he built a team which generated $25M in sales in a 12 month period. Steve’s customers include water districts, utilities, schools, community colleges, municipalities, agriculture, and private business. He earned an MS and MBA from the University of California at Berkeley.