Page 122 - Water Loss Control

104 Cha pte r Ni ne

in this case, major capital expenditure will be involved and long term payback of this
capital expenditure has to be taken into account. These two levels of economic opti-
mum (firstly, by varying revenue items alone, and then looking at capital expenditure)
1
are known, respectively, as the short- and long-run economic levels. The formal econo-
2
mists definitions of these are: “The short run is a period of time in which the quantity of
at least one input is fixed and the quantities of the other inputs can be varied. The long
run is a period of time in which the quantities of all inputs can be varied, and other new
inputs can be introduced.”
Examples that are generally quoted, using manufacturing industry, refer to labour,
materials, and power as variables that can be changed in the short run, whilst plant
capacity can only be changed in the long run.
The current thinking on the economic level of leakage (ELL) is based on the knowl-
edge that each and every activity aimed at reducing leakage follows a law of diminishing
returns; the greater the level of resources employed, the lower the additional marginal
benefit which results. This understanding forms the basis of a new methodology in which
every activity is analysed in a similar way to compare its marginal cost with that of other
interrelated activities, and with the marginal cost of water in that supply zone.
This approach can be applied to the four primary activities that impact on leakage
control, that is, pressure management, active leakage control (ALC), quality and speed of
repairs, and infrastructure improvements, which are often illustrated as shown in Fig. 9.1.
To further the comparison with the examples used in manufacturing industry, the ele-
ments such as active leakage control and repair activity can be considered to be revenue
items and would therefore be considered in the evaluation of the short-run ELL, whereas
pressure management and mains rehabilitation would require an investment decision,

Losses flex with pressure Pressure Economic level of real losses
management

Unavoidable
annual real
losses
Speed and quality Active
of repairs leakage control
Potentially
recoverable real
losses

Pipeline and
asset management
Current annual real losses selection,
installation,
maintenance,
renewal,
replacement

FIGURE 9.1 The four primary methods of controlling water losses. (Source: IWA Water Loss Task
Force and AWWA Water Loss Control Committee.)