Non-Revenue Water

Non-revenue water is the water that an urban water utility produces and puts into the supply system but does not earn billed revenue from. Precisely, it is the difference between system input volume and billed authorised consumption for a given period, expressed either as a volume or as a percentage of input water. It arises mainly from physical losses in the network and commercial or accounting losses in measurement and billing.

Constitutional / legal basis

Non-revenue water is a technical water-utility concept and is not defined in the Constitution. The constitutional setting for urban water supply is Article 243W read with the Twelfth Schedule, which includes water supply for domestic, industrial and commercial purposes as a municipal function; water is also covered by Entry 17 of the State List, subject to Entry 56 of the Union List.

Key points

• Physical or real losses are actual losses of water through leakage, bursts, seepage and overflows in transmission mains, distribution pipes, service reservoirs, valves and service connections up to the consumer meter.
• Commercial or apparent losses are not actual water leakages but losses in recorded revenue, caused by customer-meter under-registration, faulty bulk meters, billing and data-handling errors, unauthorised use and illegal connections.
• Unbilled authorised consumption is also part of non-revenue water; it includes legitimate uses for which the utility does not bill, such as firefighting, mains flushing and some public uses.
• High non-revenue water means that treated water, pumping energy and chemicals are being used without corresponding billed service, weakening both resource conservation and utility finances.
• Non-revenue water is measured through a water balance or water audit comparing water produced, distributed, billed and lost; metering at production points, district zones and consumer connections improves its estimation.
• Reducing non-revenue water can often increase effective water availability without immediately developing new raw-water sources, making it important for urban water conservation and circular water economy planning.

How UPSC asks this