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Contact UsImagine a water utility supplying 10,000 cubic meters of water into its distribution network in a single day. After customer readings have been collected and processed, however, only 7,000 cubic meters are recorded as billable consumption.
What happened to the remaining 3,000 cubic meters?
Some water may have escaped through leaking pipes. Some may have reached customers without being measured or recorded correctly. Another portion may have been used for authorized activities that are not billed.
This difference is known as Non-Revenue Water (NRW), one of the persistent operational and financial challenges facing water utilities.
Indonesia provides a clear example of its significance. The country's 2023 Water Utility Performance Report recorded a national NRW figure of 33.90%.
That historical figure does not mean one-third of all distributed water was physically leaking. NRW includes different categories of losses, and each requires a different response.
Understanding those categories is essential before deciding where smart meters, flow monitoring, pressure sensors, and Internet of Things (IoT) technology can contribute.
Non-Revenue Water represents the difference between the volume entering a water distribution system and the volume of authorized consumption billed to customers.
The World Bank's NRW resources, developed with water-sector partners including the International Water Association, identify three principal components.
Physical losses, also called real losses, occur when water escapes from the supply infrastructure before reaching its intended consumption point.
Examples include leaks in transmission and distribution mains, failures in service connections before customer metering points, and leakage or overflow from storage facilities.
The consequences extend beyond the missing water itself.
Utilities may already have invested energy, treatment chemicals, labor, and infrastructure capacity in producing and transporting that water.
Underground leaks can remain undetected for extended periods, particularly when they do not create visible surface damage.
Apparent losses occur when water is consumed but not correctly measured or accounted for.
These may result from inaccurate customer meters, unauthorized use, or errors in reading and processing consumption information.
Unlike physical leakage, the water may have reached its intended user.
The problem is that the utility has not accurately captured the associated consumption for its commercial records.
This distinction is important because replacing a defective meter and repairing a leaking distribution pipe solve different problems.
Some water is used for legitimate operational or public purposes without generating a customer bill.
These volumes also form part of NRW.
A credible water balance should identify them rather than automatically treating all unbilled water as leakage or unauthorized consumption.
Knowing the overall NRW percentage does not reveal where water is being lost.
A utility may calculate the monthly difference between water supplied and billed consumption but still lack sufficient data to determine the underlying causes.
Several operational challenges contribute to this difficulty.
Water distribution systems include pipelines, valves, storage facilities, pumps, and customer connections spread across extensive service territories.
Many assets are underground or located in areas that are difficult to inspect.
Without adequate monitoring, changes in hydraulic conditions may remain unnoticed until customers report a service problem or visible leakage appears.
An accurate diagnosis requires understanding how water moves through the network, not merely reviewing the total production volume.
Measurements at treatment plants or primary distribution points provide useful information, but they may not explain what happens inside individual service areas.
Flow monitoring can help show how much water enters a particular section of the network.
Pressure measurements provide additional information about hydraulic conditions.
However, neither an unexpected flow increase nor a pressure drop proves that leakage has occurred.
Changes in demand, pumping operations, valve settings, and supply arrangements can produce similar patterns.
Measurements must be interpreted alongside operating schedules and network characteristics.
Customer meters are essential for recording billed consumption.
If meters under-register usage, the volume recorded by the utility may be lower than the amount actually delivered.
Manual reading errors and incorrect data processing can introduce additional discrepancies.
Remote reading technology can improve the consistency and availability of meter data, but it does not automatically correct the accuracy of the underlying measuring instrument.
Reliable commercial loss management requires both appropriate metering technology and sound data-management procedures.
IoT technology allows compatible field devices to transmit measurements to centralized monitoring applications.
In water distribution systems, relevant devices can include flowmeters, pressure sensors, smart water meters, communication gateways, and network monitoring equipment.
Their value depends on which operational question they are intended to answer.
| Technology | Measurement or function | Potential NRW application |
|---|---|---|
| Flowmeters | Flow rate or accumulated volume | Water balance and zone inflow monitoring |
| Pressure sensors | Pressure at selected network points | Hydraulic monitoring and pressure analysis |
| Smart water meters | Customer consumption readings | Consumption reconciliation and commercial data quality |
| IoT gateways | Communication between field devices and network systems | Remote data collection |
| Monitoring dashboards | Historical data, alerts, and device information | Investigation and operational prioritization |
These components may use different communication technologies.
LoRaWAN, cellular networks, Ethernet, and industrial communication interfaces may all be appropriate in particular circumstances.
The choice depends on device requirements, data frequency, site conditions, and existing infrastructure.
Measuring flow at selected network boundaries can help operators estimate how much water enters a service area.
That information can then be compared with customer consumption records from the same area and period.
The difference may justify further investigation.
However, a volume discrepancy alone does not identify a leak.
Operators must also consider unbilled authorized consumption, meter inaccuracies, time alignment, and whether the measurement boundaries are correctly defined.
Pressure data provides context for understanding network conditions and abnormal events.
Changes in pressure may reflect demand patterns, pump operations, valve behavior, or potential infrastructure problems.
Monitoring can help operators recognize when conditions depart from established patterns.
Pressure management is also a recognized approach to managing physical water losses.
Nevertheless, any control strategy must preserve the required level of service and account for network elevation, hydraulic constraints, and customer needs.
Automatic reading of compatible customer meters can make consumption records available more frequently and consistently.
This information may support billing reconciliation, investigation of unusual consumption, and detection of missing or inconsistent readings.
Its contribution to commercial loss management can be meaningful where data collection has been a persistent problem.
But communication technology cannot correct a physically inaccurate meter.
Likewise, a customer smart meter cannot independently locate every leak occurring upstream in the distribution system.
A District Metered Area (DMA) is a defined part of a water distribution network where water entering and leaving the area can be measured.
By dividing a large service territory into smaller, hydraulically understood zones, operators can investigate water balances more systematically.
Instead of treating the entire distribution network as a single problem, the utility can identify areas that require greater attention.
A DMA must have clearly understood hydraulic boundaries.
Unknown interconnections, incorrectly positioned valves, unmeasured bypasses, or inaccurate boundary meters can undermine the water balance.
Customer consumption records must also be assigned to the correct area.
Measurement periods need to be aligned, particularly when comparing frequent inlet readings with customer meter readings collected at longer intervals.
Without these controls, a seemingly precise dashboard may produce misleading results.
Minimum Night Flow analysis examines water flow during periods when legitimate customer demand is expected to be relatively low.
Unusually persistent night flow can support leakage investigations.
However, night flow is not entirely leakage.
Industrial users, overnight operations, storage tank filling, and other legitimate activities may continue consuming water.
A meaningful analysis therefore requires estimates of legitimate night consumption and an understanding of local operating conditions.
Consider a hypothetical DMA with the following monthly measurements.
| Parameter | Volume |
|---|---|
| Water entering the DMA | 100,000 m³ |
| Billed authorized consumption | 72,000 m³ |
| Non-revenue water volume | 28,000 m³ |
| NRW percentage | 28% |
The basic calculation is:
NRW (%) = (System input volume − Billed authorized consumption) ÷ System input volume × 100
The resulting NRW percentage is 28%.
This does not mean that 28,000 cubic meters leaked from the pipes.
Further analysis is needed to distinguish real losses, apparent losses, and unbilled authorized consumption.
The figures are hypothetical and do not represent actual results from an IKI deployment.
A utility should assess its network and available data before selecting new IoT equipment.
World Bank guidance on NRW reduction emphasizes initial assessments, water balances, field verification, meter accuracy testing, and clearly defined performance indicators.
For IoT-based monitoring, a practical implementation can follow a similar sequence.
The initial objective should be reliable information that operators can act upon.
Expanding the number of connected devices is useful only when the additional data supports a clearly defined operational requirement.
PT IoT Kreasi Indonesia (IKI) provides IoT solutions for connected measurement, communication infrastructure, monitoring applications, and system integration.
Its Smart Water Monitoring portfolio includes applications associated with water consumption, flow, pressure, and distributed utility monitoring.
The appropriate architecture depends on existing instruments, installation conditions, network requirements, and the data needed by the customer.
In July 2025, IKI published an announcement describing its agreement with Perumdam Gapura Tirta Rahayu in Purwakarta to implement LoRaWAN-based automatic water meter monitoring.
The publication establishes the announced collaboration and its intended objectives. It does not independently verify completed NRW reduction, quantified savings, or final project performance.
IoT connectivity and monitoring should be understood as supporting components of a broader NRW management program.
The reduction of physical or commercial losses ultimately depends on accurate diagnosis and suitable corrective action.
NRW includes physical leakage, apparent losses caused by metering or commercial data problems, and authorized water consumption that is not billed. The relative contribution of each category varies between utilities.
Not automatically. Smart water meters can improve consumption data availability, but NRW reduction requires corrective action appropriate to the causes identified.
A DMA provides a defined area for measuring and comparing water input and consumption. This can help utilities prioritize investigations and evaluate changes over time.
Pressure measurements may reveal abnormal hydraulic behavior, but locating a leak typically requires additional measurements, network analysis, or field investigation.
No. Physical leakage is one component of NRW. The broader NRW definition also includes apparent losses and unbilled authorized consumption.
No. LoRaWAN is one option for connecting compatible field devices. Cellular, wired, and other communication technologies may be appropriate depending on site and application requirements.
Non-revenue water is not a single technical problem.
Physical leakage requires network investigation and repair. Inaccurate metering requires instrument assessment and corrective action. Commercial discrepancies require improvements in data processing and billing procedures.
IoT monitoring can make the information needed for these decisions more accessible.
When flow, pressure, customer consumption, and operational data are combined appropriately, water utilities can prioritize investigations with greater confidence.
However, the measurements only create value when they lead to well-founded action.
Utilities evaluating connected water monitoring and system integration can explore PT IoT Kreasi Indonesia's Smart Water Monitoring solutions.
Ministry of Public Works and Public Housing, Republic of Indonesia. (2023). 2023 Water Utility Performance Report. https://www.perpamsi.or.id/public/storage/assets/upload/3m4pBwREtq7nSEIsaguDMgwnROX5h7pwqOuw7HD2.pdf
Ministry of Finance, Republic of Indonesia. (Publication date not verified). Optimizing Public-Private Partnerships for NRW Reduction. https://kpbu.kemenkeu.go.id/read/1211-1741/public/public-study-opinion/optimizing-the-role-of-ppp-in-reducing-nrw-a-strategy-for-better-drinking-water-services
World Bank Group and water-sector partners. (n.d.). Contracting Tools for Non-Revenue Water Reduction. https://ppp.worldbank.org/water-and-sanitation/contracting-tools-non-revenue-water-reduction
World Bank Group. (n.d.). Performance-Based Contracting Tools for Non-Revenue Water Reduction – Project Preparation Process. https://ppp.worldbank.org/water-and-sanitation/performance-based-contracting-tools-non-revenue-water-reduction-project-preparation-process
PT IoT Kreasi Indonesia. (n.d.). Smart Water Monitoring. https://www.weiots.io/solution/water-monitoring
PT IoT Kreasi Indonesia. (July 15, 2025). Enabling Automatic Water Monitoring with LoRaWAN in Purwakarta. https://www.weiots.io/blog/en/enabling-automatic-water-monitoring-with-lorawan-in-purwakarta