Development of a Leakage Target Setting Approach for South Korea based on Economic Level of Leakage

Abstract

Leakage has become a crucial issue that needs to be addressed effectively by the water suppliers in terms of economic management of the water system. Leakage management costs such as pipe replacement, pressure management, detection and repair costs have been steadily increasing. These costs have a direct effect on the financial performance of water suppliers. Hence, they have to continuously do their best to reduce leakage. However, a large number of water systems are operated by small local government operators who are not well funded and lack the necessary expertise. Consequently, a large volume of water is being lost due to leaving on-going leakage unrepaired. In order to resolve these problems, South Korea has been promoting the Non-Revenue Water (NRW) reduction project of local water supplies in which the authorized organization, specializing in water management would operate facilities on behalf of struggling local government. K-water, the public water company in South Korea, has been operating and managing 22 NRW reduction projects instead of local government since 2004.

In this thesis, a target setting method based on the Economic Level of Leakage (ELL) calculation is proposed. The methodology applied is developed specifically for the South Korean context to select a minimum achievable level of NRW. In addition, the thesis will examine the appropriateness of the current target within existing financial constraints by using limited available data. This approach is focused on the derivation of the NRW control cost curve by using the newly developed cumulative method that minimizes data fluctuation and enhances the cost curve reliability. This has been applied to a case study by using data collected from the water supplier information system. The results obtained from the case study show significant outcomes in respect of both identification of an economically optimal target and prevention of unnecessary investment to meet this aim. This advance in leakage management allows water suppliers to select a rational target and manage their system economically and efficiently.