Water theft: how big is the problem?

Thames Water is using detectives to help catch water thieves. The story, which emerged late last month, may have brought the issue of water theft to the fore, but just how big a problem is it for the water industry? Utility Week investigates.

Every day, water companies lose 3,123 million litres of water from leaky pipes. But how much of this water loss is down to faulty and aging assets, and how much is down to theft?

Recent warning signals from several water companies suggest the number of unauthorised connection to water mains – a criminal offence under the Water Industry Act 1991 – has increased significantly in recent years, and may be partly to blame for a stagnation in water companies’ ability to reduce leakage since 2000.

How big is the problem?

Late last month, Thames Water revealed the number of unauthorised connections within its London and Thames Valley license area had soared from 33 in 2011 to 734 in 2017 – resulting in a loss of between 2 million and 3 million litres of water each year.

To combat this “dramatic crime spike” Thames has deployed a team of investigators, led by a former police detective to track down thieves stealing water from its pipe network. And it’s no wonder the company is taking the issue so seriously.

In June 2017, the water company was fined a record £8.55m for missing its leakage reduction targets for the year, by a margin of 47ml/day – suggesting Ofwat applies a notional value of around £180,000 for every megalitre per day unaccounted for by water companies.

Clearly water theft is only a small contributing factor to Thames’s bigger leakage problem, but with an estimated 2-3 million litres of water being illegally tapped each year, a crack-down on the criminals could still save the company a not insignificant amount of cash.

Nor is Thames Water alone in its struggles against water theft. Speaking on behalf of Severn Trent, Ria Gaffney tells Utility Week the crime is a “huge problem”. And South West Water, too, takes the connection of unauthorised standpipes to its network “very seriously”.

In part, the suddenly overt concern expressed by these companies in the problem of water theft can be explained by the impending introduction of extremely challenging leakage reduction targets of by Ofwat in PR19 – companies are expected to reduce leakage by at least 15 per cent by 2025, and that is the absolute minimum that is expected.

With such testing targets ahead of them, its understandable that companies feel newly motivated to come down hard on criminals who could contribute to punishable performance shortfalls in the coming AMP.

But water theft is not just a problem because of its potential to expose water companies to leakage fines from the regulator if they fail to differentiate between water lost through criminal activity, and that lost through asset faults.

Water theft also impacts law abiding customers, since it leads to higher bills and can disrupt supplies.

Then too, there is a risk that unauthorised connection could impact water quality, potentially posing a public health risk. And unauthorised connections can damage water company infrastructure.

What are companies doing about it?

Water theft is not an issue for all water companies. However, before it becomes a mammoth and costly headache, water companies are cracking down on the issue of water theft in a number of ways, including encouraging public tip-offs, regularising temporary access, and introducing new technologies.

Temporary water access is required by both construction and development companies as well as fire and rescue services and companies like Aqua Water Services have now set up collaborative partnerships with water companies to provide an approved hire scheme for official water connection points. The Aqua Water Service scheme not only provides users with an approved method of obtaining water but also training to ensure that their consumption minimises adverse effects on the network.

Severn Trent senior technician of water fittings Dan Littlewood tells Utility Week: “When we work with official users of our hydrants, which range from fire and rescue services to housebuilders, we make sure they’re aware that they can have a very real impact on our customers’ lives and we can educate them on how to use them properly.”

Technology, meanwhile, offers another way to mitigate water theft by reducing the opportunity for meter tampering. The recent introduction of smart water meters by companies including Yorkshire Water, South West Water, Severn Trent and Thames Water, for example, enables the companies to monitor water use throughout their pipeline networks, making it easier to identify illegal activity.

And in instances where water theft is unequivocally identified, water companies have also become increasingly ready to resort to prosecution, making an example of perpetrators and recovering some of their costs.

Severn Trent’s Gaffney says over the last 18 months the company has successfully prosecuted 42 companies for illegal hydrant use and issued warnings to more than 160 companies. More recently, cleaning firm Hydro Cleansing pleaded guilty to 18 offences of illegally connecting to Thames Water standpipes and was ordered to pay fines and costs totalling almost £15,000.

Cracking down on water theft is a sensitive process, especially at a time when water company legitimacy is under scrutiny and politicians seem determined to frame utilities as the bad guys in a show down between Joe Public and privatised institutions.

But as downward pressure mounts on water bills and Ofwat applies its challenging new targets for leakage reduction, water companies will have little choice but to get tough on those who believe they can dodge legitimate access routes to water, incurring added costs to consumers in the round and exposing companies to inflated regulatory penalties.