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Oh, The Water We’ll Need... (Using System Thinking and Design To Build The Water Utility of The Future).

It's almost impossible to go a day without some bad news about water quality issues somewhere in the US. It's zebra mussels in AustinLead and copper in Sandy CityDirt in TrentonMaybe PFOA in LowellLead in Chicago and Seattle. And the issue is all over the country. One in four US homes has poor quality waterAnd it's even worse in rural areasBut water quality is a symptom of a bigger problem that needs to be solved at the root. When you think about it, the people who work at the water utility want you and I to have potable water to drink. It's why they go to work every day. But their ability to ensure quality water come from issues relating to aging infrastructure (D grade on the infrastructure report card), increasing complex regulations and confusion from the EPA, dwindling water sources and the ongoing retirement of a third of the water utility workforce (Brookings).

As the sources of water continue to become scarce — especially with the rise in populations, urban growth and climate change —, and polluted, the water utility’s role in ensuring people get potable water becomes ever more critical. Every step along the process of sourcing, collecting, treating, storing and distributing water to a customer’s home has to be upgraded to cater to these changes. Because, fundamentally, the water provision in every city is an indication of its livability. There are the consequent public health issues and the loss of resiliency in the distribution system brought about by the aging infrastructure. These issues also affect the power industry which is one of the larger consumers of water provided by wastewater treatment facilities. A more comprehensive approach to managing this critical system is necessary.

Integrated System Management

To this end, some water utilities are adopting an integrated water management approach. This is the holistic management of both the physical and service responsibilities of the organization. This holistic approach will enable the water utility to better serve its role in the society. And what is that role in the future? It is to provide water sustainably, work with other entities to increase livability in our communities through the use of intelligent technology to optimize operations adaptively based on the needs of the residents of the communities being served. This is a different approach from what most water utilities, especially the ones that have 5k-100k connections on their distribution system, have had to use. While the variations between utilities are vast (some are municipality owned, some are privately owned and some cover wastewater and water) there is a transition required to ensure relevance and an ability to serve the future needs of the people being served by the utility. Customers who demand even more from their service providers based on the experiences they have with companies that provide less-critical services.

Transitioning To The Future State

So what does the transition look like? A lot of it will have to come from the policy side. It’s a travesty that it costs more for a bottle of water obtained from the taps once you slap a label on it. What bottled water, and the high cost of bottled water, shows is that people will pay for whatever they believe the value of a product is. The policy considerations should be ok with raising the price of water. That’s the first policy change that needs to happen before all these technological advancements can be obtained and implemented. Increasing the rate that the utilities can charge for the water they provide enables the utility to invest in the technologies to further create efficiencies. But to be able to make the claims for an increase in their discussions with commissions, the utility needs to have the data available to show where the efficiencies can be gained by deploying the right assets in the right parts of the distribution system.

Rate Increases Are Necessary

Most informed folk in the industry know that the solution to the struggles of the utility will start with being able to charge customers more for the water that they are supplied. Summarizing the State of The Water Industry Survey from AWWA.

Faced with increasing capital needs and potential funding shortfalls, many utilities must increase the rates they charge for water services in the immediate future. To understand how rate increases would be perceived, utility personnel were asked, “If your utility was to consider a rate increase in the coming year, how do you think it would be received by the following groups?” The groups presented were the general public, residential customers, nonresidential customers (industrial/commercial/institutional), public officials, business leaders, and the media. Response options were very negatively, negatively, indifferently, positively, and very positively. Figure 7 summarizes the responses from 2018 SOTWI survey respondents.

AWWA State of Industry 2018

The utility will have to make some investments in software/sensors that start to visualize the system in a way that communicates where the needs are and where the most value can be gained in the system. The utility will have to map operational insights to investment requirements and, consequently, map those to changing the perceptions of the customer base to the absolutely necessary rate increases. The rate increase, mapped from the data, will make the funds available to the leadership for investments in technologies that help effective management of the distribution systems. The data enables the utility to show the ‘proof-of-concept’ that will convince the commission(er) that there is indeed a requirement for money to be spent on the distribution system. Since there is an indication that most infrastructure projects by US government will not be public-private partnerships it does look like there will be a need for municipal water utilities to find their money from somewhere else.

Where Software Plays In A Hard Business

While infrastructure development is one approach, it is not the only one that is critical towards transitioning to a future utility. There are efficiencies that can be gained in the system by working with enterprise management software companies that help the utility map its end-to-end operations and respond to distribution system issues in real-time. These non-capital (or at least low capital) approaches to utility upgrades can come in the form of partnerships with software companies that put the pulse of the distribution system in the hands of the utility manager or public works director. The utility still owns and manages the system but with the help of a technology supplier that provides, for lack of a better phrase, the communication layer between the public works director/manager and the system (with the system being both the hard and soft resources of assets and people). These partnerships can help the utility reduce response times when issues are evident on the system, enable the utility to deploy the right resources at the right time and provides the utility with an audit trail that enables it to keep the commission & customers informed of all that is important during reporting.

A combination of investment in new technologies and systems and a more service-oriented perspective on the product that the utility delivers will enable the utility to attract the right kind of talent to do the future work that is critical in this industry. This is the third leg in creating a future state that is more aligned with what customers desire from their utility providers; talent. Maintaining the old approaches to running the utility will ensure that the expertise of the 30% of the utility workforce that is retiring over the next few years does not inform the future state. The future workforce will desire a culture of innovation and service that the current state of the utility does not provide based on an understanding of how things worked and can be exponentially improved. As much as we desire that the skills of the retiring workforce be maintained, we will fail to transition to the future if we do not focus on bringing in a new workforce or upskilling the current workforce in new approaches to running the utility.

Doing The Necessary

Water rate increases will fund utility investment in new technologies and assets. Partnerships with companies that are not traditionally on the ‘vendor list’ of the utility, and a willingness to look to non-traditional spaces/resources for the future workforce, will bring in new and effective approaches to operations. These changes will bring about a critical realignment of the water utility to enable it to serve the future customer with the service they desire and require. These changes are the only chance for survival for the utility. Products like Varuna, which bring real-time visibility into the system, will enable optimal operational, financial and customer management and bring about a new regime of effective utility management. For old and new employees of the utility alike.

Let’s get to work.

Originally published on the Varuna Blog. Varuna is an enterprise management system for municipal and rural water utilities providing real-time visibility into the flow and quality situation within the distribution system.

Seyi Fabode's picture

Thank Seyi for the Post!

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