Learn · Updated 2026-09-29
Non-revenue water (NRW): what it is and how to calculate it
NRW is the water a utility puts into supply but never bills. Learn the IWA definition, the formula, what counts as apparent versus real losses, and why percentages mislead.
Non-revenue water is the difference between the volume of water put into a distribution system and the volume billed to customers. It is the single most-quoted number in water loss management, and the most misunderstood.
NRW = System input volume − Billed authorised consumptionWhat NRW is made of
NRW is not the same as leakage. It has three components, and the split between them decides what you should do about it.
- Unbilled authorised consumption — water legitimately used but not charged: firefighting, mains flushing, exempt public buildings, the utility's own works.
- Apparent losses — water that reached a customer but was never recorded: illegal connections and meter tampering, customer meters that under-register, and errors in meter reading, billing and data handling.
- Real losses — physical leakage from mains, service connections and storage tanks, up to the point of customer metering.
The formula, step by step
In a top-down water balance you measure or estimate system input and every component of authorised consumption and apparent losses. Real losses are what is left over. That is why the uncertainty on real losses is always larger than on any input — every error upstream lands there.
| Component | How it's usually obtained |
|---|---|
| System input volume | Bulk meters at treatment plants, bores and imports, corrected for meter accuracy |
| Billed metered consumption | Billing system, adjusted to the balance period for meter-reading lag |
| Billed unmetered consumption | Sample studies or assessed volumes for flat-rate customers |
| Unbilled authorised consumption | Operational records and estimates; typically 0.5–1.5% of input |
| Unauthorised consumption | Estimated connections × persons × litres per person per day |
| Meter under-registration | Meter test results by age and size, applied to metered volume |
| Real losses | Residual — verified by night-flow measurement in district metered areas |
Why NRW percentage is a poor performance indicator
NRW as a percentage of input depends on consumption as much as on losses. A city with high per-capita use and moderate leakage can post a lower percentage than an efficient utility in a low-consumption region. Percentages also swing with drought restrictions and intermittent supply. The IWA recommends volume-based indicators instead: litres per service connection per day (when the system is pressurised) for real losses and NRW, and the Infrastructure Leakage Index for leakage management performance.
Putting a value on NRW
Apparent losses are valued at the average tariff because the water was consumed and should have been billed. Real losses are valued at the marginal cost of production and distribution — energy, chemicals, bulk purchases — unless the recovered water could actually be sold to new or existing customers, in which case the tariff applies to that portion. Expressed as a share of annual operating cost, the value of NRW is one of the clearest arguments for investment a utility can make.
Put it into practice
Run your own water balance and see these indicators for your system — free, in about ten minutes.
Start a water balance