City’s water system wasted a billion gallons last year

Based on the daily pleas not to water the lawn during this year's dry spell, customer excess would appear to be one of
the biggest problems for the city's water utility.

But records show that Indianapolis Water is squandering plenty of the precious commodity without any help from green lawn
fanatics–with 17 percent of the 51 billion gallons it treats and pumps from its plants never so much as moving a digit on
customers' water meters.

That 9 billion gallons–a staggering amount that not only would fill the 1,350-acre Eagle Creek Reservoir but also would
send another 1 billion gallons thundering over its dam–never reaches customers and their lawn sprinklers.

Some of the unaccounted-for water is attributed to defective meters, unmetered amounts used to fight fires, and for water-main
flushing as part of repairs and routine maintenance.

But two of the biggest culprits, amounting to at least 1 billion gallons, are leaky water mains and service line breaks and
"unknown/invisible water loss."

Some might say it's no big deal. After all, water eventually seeps back into the rivers from which it's drawn and
into the water table–and, hopefully, back into the utility's wells and reservoirs.

But there's an economic cost of unaccounted-for water that's borne by water customers. And it's a cost worth
noting, given the recent 36-percent rate increase for industrial customers and 27-percent increase for residential users.

It costs $1.6 million to treat 9 billion gallons of water with chemicals and pump it over 3,600 miles, according to the city's
Department of Waterworks estimates. But department spokeswoman Jo Lynn Garing concedes "it's hard to put a price
on that."

The estimated amount is a proverbial drop in the bucket for a utility with over $100 million in operating revenue. What the
number doesn't include are capital costs needed to produce the water that is pumped but never shows up on customer bills.

Or, looked at another way, if a water utility weren't wasting almost 20 percent of its output, it might need just four
treatment plants instead of five, said Thomas Rooney, president of Chesterfield, Mo.-based Insituform Technologies, one of
the world's largest repairers of sewer, water, oil and gas pipelines.

Efficient by comparison

Indianapolis' unaccounted-for water rate is relatively low, at least compared with cities such as Miami, Philadelphia
and London, where Rooney said the loss rate ranges from 25 percent to 50 percent.

"That's far more than can ever be saved through conservation," he said.

In Indianapolis' case, the customer conservation strategy seems to be the preferred remedy to meet demand in peak periods–in
addition to whatever can be done to eliminate leaks and to replace inaccurate meters.

As part of securing its recent rate hike from the Indiana Utility Regulatory Commission, the city agreed to recommendations
by the state Office of Utility Consumer Counselor to expand its efficiency and conservation programs.

That includes improved leak detection and monitoring and promoting more water-efficient fixtures and irrigation practices.

Unaccounted-for water is one thing, but "it gets to a much bigger issue-water conservation and efficiency," said
OUCC spokesman Anthony Swinger.

The agency leans on water utilities to reduce their percentage of unaccounted-for water to not more than 15 percent; the
ideal is 10 percent.

Though Indianapolis' unaccounted-for water rate is still relatively good, at 17.4 percent, it's up 40 percent since
2003, when the amount of waste was just 12.4 percent.

Era of bad pipes

One problem is a particularly troublesome generation of pipe installed in the 1940s and 1950s that's starting to show
its age, said Angie Dye, spokeswoman for Veolia Water, the private firm the city hired to manage the water utility.

Ironically, compared to some metal pipes dating to the late-1800s and early 1900s, the more contemporary pipes "have
not stood up as well," she said.

Indeed, an estimated 57 percent of leaks worldwide come from pipes installed by utilities between 1945 and 1965, said Rooney
of Insituform Technologies.

The problem stems from a steel shortage right after World War II, coupled with a suburban housing boom that followed. The
industry had to make do with pipes made from a combination of steel and concrete, asbestos or any number of newfangled plastic-like
materials.

The phenomenon occurred not just in the United States but also in Soviet-bloc countries like Hungary and Bulgaria, as Rooney
has discovered during dealings there.

"It's a global phenomenon," he said.

That generation of pipe is lasting only about half as long as seemingly primitive cast-iron pipes. Increasingly, these newer
pipes are leaking "like if you had a garden hose and each day you put another pinhole in it," Rooney said.

"It's the retirement of the baby boom pipes," Rooney said. "Veolia and [other water operators] are on
the edge of a very substantial problem."

Perhaps. A study by McLean, Va.-based consulting firm Booz Allen Hamilton projects that about 60 percent of the $41 trillion
in infrastructure spending worldwide by 2030 will go for water infrastructure needs–ahead of spending on electrical power,
roads, railroads and other pillars of civilization.

Booz Allen said it's not uncommon for some cities to have 1,000 water main breaks a year. It estimates that Detroit leaks
35 billion gallons of water a year, costing residents $23 million.

"Twenty-five to 35 percent of all water pumped through pipes in the U.S. never arrives," Rooney said. "It's
a staggering amount of water."

The city of Indianapolis, under its management contract with Veolia, seeks to reduce the amount of unaccounted-for water.
But the 9.36 percent goal last year was a distant target–half of what the company achieved.

Veolia met 91 percent of its other goals last year to earn $8.15 million in incentive payments.

Garing said the city has been pleased with Veolia's "pipe lab" program to reduce unaccounted-for water. When
a water main breaks, Veolia employees analyze the pipe and surrounding soil conditions as a predictor to where future breaks
may occur in the system.

That could be useful in planning future capital projects such as water main replacements.

As a result of its recent rate hike, the Department of Waterworks plans to invest $230 million through 2009 on system improvements.
Officials declined to speculate what that might mean in terms of reducing the leakage rate.