The term NRW is used for any water which does not generate income for a water organisation. This includes real losses (e.g., leaks) and what are called apparent or commercial losses (e.g., losses due to errors and theft).
In a well-run utility these loses should be kept to a minimum by continuous actions to manage losses. Unfortunately, in many water utilities these losses are far higher than need be, leading to a reduction in the water available for customers and a reduction in income to the water utility. This in turn can lead to a reduction in the quality of service and, if not addressed, can spiral downward. For this reason, partners (e.g., funding agencies) are looking more and more at the level of NRW as a proxy indicator of the efficiency and effectiveness of the management of a utility.
Water losses cannot be measured directly. The easiest way to estimate the level of NRW in a system is to draw up a water balance as in the table below, calculating or estimating each of the components. This was developed by the International Water Association (IWA), a membership organisation open to all water industry professionals, and has now been adopted as standard practice through most of the world.

The IWA Standard Water Balance
There are a number of simple spreadsheet tools available to assist in the calculation of the water balance and associated metrics. An easy one to use is the World Bank Easycalc which is multi-lingual and can be downloaded free from Download WB-EasyCalc
Much of the time real losses are quoted in percentages. However, this can be misleading and cause problems. Firstly, because the higher the per capita consumption within a utility, the lower will be the percentage losses for the same amount of water. Secondly, where water is not continuously available, an increase in the period of supply can bring about an increase in the percentage of water lost, although the level of leakage is exactly the same.
A more widely regarded measure in the industry is the Infrastructure Leakage Index (ILI) which is a ratio of the actual leakage to a theoretical minimum level of leakage which is possible for that particular network. The World Bank considers that an ILI of 4.0 for a utility in a low- or middle-income country is good; but many countries have levels of leakage ten or twenty times that. This metric can be calculated using the spreadsheet referred to above. Two other metrics which can also be used are losses per connection per day and losses per kilometre of watermain pipes per day. It is important that all metrics are calculated for the period when there is water in the watermain – often referred to as WSP (when water supply is pressurised).

Jo Parker, BSc Civil Engineering
Technical director specialising in the management of buried assets, particularly in the water industry