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Digital Water Metering – Helping Protect Our Future Precious Drinking Water Supply

Authors: Raghu Bharadwaj, Glenn Wilson, Virginia Collins Anderson, Ash Walsh

Yarra Valley Water is exploring how digital water metering could help customers to save money by monitoring their water-use in near real-time and detecting water leaks early.

Digital meters also play a key role in helping to protect Melbourne’s precious drinking water supplies as our climate gets hotter and drier and as our population grows – find out how as we share some of our learnings here.

Project planning for innovation

Yarra Valley Water has been investigating replacing its current mechanical water meter fleet for some time. We’ve committed to proceeding with this only if it’s cost neutral (meaning the benefits must be at least equal to the costs over the evaluation period) and has widespread customer support.

image of two people smiling next to digital meter
YVW Managing Director Pat McCafferty (left) with a YVW customer who was part of our digital metering field trials


For Yarra Valley Water, the implementation of digital water meters is broken up into five distinct phases:
digital metering business phases

Phase 1 - Developing a robust business case

This involves:

  • engaging with customers and stakeholders to understand their needs
  • testing available technologies to understand how they work and their associated risks
  • undertaking specific research to understand key assumptions (including at a global scale)
  • running small scale customer field trials
  • completing a sensitivity analysis of key business case costs and benefits.  

Phase 2 - Developing an operating model

This phase involves reimagining the future metering and billing processes, including all of the associated people, process, system and data requirements. The phase ends when the processes can be successfully executed (not necessarily at scale). Some of the specific tasks completed as part of this phase include:

  • selecting a digital water meter
  • selecting the communications services technology and partner
  • implementing key parts of the backend IT system including device management, data store, and integration with existing enterprise applications such as asset management and billing
  • selecting a meter installation partner.

Phase 3 - Scaling up

This phase - dependent upon customer and regulatory support, robust technologies and a viable business case - involves rolling out digital meters and the new processes and systems across the entire customer base. It ends when every property has a digital water meter and we are able to decommission the current processes (establishing a new business as usual).

Phase 4 - New products and services

This phase involves developing new products and services based on customer feedback. These are currently largely unknown but will be driven by the data we collect and the way we manage the customer experience from end to end. Our customer research has already indicated a desire for our services to extend beyond the current boundaries and that a failure to do so could result in dissatisfaction.

Phase 5 - Continuous improvement

Once we establish the new business as usual, there is an ongoing process of refinement and improvement.

The time taken to move from one phase to another can vary depending on the individual water company, and work on multiple phases will often take place at the same time – the pace of change depends on the organisation’s risk appetite, staff capability, and push from external forces.

Yarra Valley Water is nearing the end of Phase 1. This phase has been ongoing since 2013 when the first iteration of the business case commenced - highlighting the amount of work required to get to a point where a robust business case is possible.

Driving behavioural change

The most significant business case benefit is the potential to reduce customer water usage through behavioural change (which in turn provides greater water security at a macro scale in light of climate change and population growth). We can drive behavioural change in a number of ways by providing customers with:

  • information about leaks on their property or unnecessary usage, such as taps or hoses left on
  • more information about their individual water use including historical comparisons (i.e. comparing one year to another)
  • comparisons to other similar households in the same suburb or even across the Yarra Valley Water service area
  • tips on how to reduce their bills - identifying usage trends which are abnormal or above average such as garden watering.
image of website with graph and phone screen with text
Examples of Yarra Valley Water’s customer portal and mobile phone application, which aim to influence water usage behaviours

We know that we need to frequently reinvent and reinforce behavioural change interventions in order to be effective. This doesn’t just mean providing customers with access to a portal or mobile phone application. It means connecting via a range of channels and regularly changing the approach to make it interactive and valuable.

Modelling to meet future needs

In Victoria, Urban Water Strategies are prepared every five years, providing a 50-year outlook on how both water supply and demand will be managed. The last strategy prepared for metropolitan Melbourne was completed in 2017 and provided insight into how a range of climate change and population growth scenarios would impact the potential timing of introducing additional water supplies.

Under a worst-case climate change and population growth scenario, the 2017-2021 Urban Water Strategy predicted that we would have enough water until around 2028 – a scenario which is now more likely than the medium scenario, which predicted we would have enough water until 2043. Given these pressures, the long run marginal cost of water savings have dramatically increased. This in turn has meant that projects such as digital metering are now a potential major (and cost effective) contributor to water security. Recent modelling completed by Yarra Valley Water, South East Water and City West Water indicates that digital metering could save as much as 335GL over the next 25 years based on a conservative level of customer behavioural change. This is a positive projection which could help Melbourne as we plan to manage hotter and drier summers, population growth and the need to ensure that everyone has access to safe and reliable drinking water for years to come.

Key learnings and success factors

Some of the key learnings we can share from our work to date include:

  • Customer experience research and design is extremely important. Digital metering presents a unique opportunity to redefine the entire metering and billing experience, ensuring we meet customer needs and can adapt as they change. This is an iterative process and small-scale customer trials are a great way to test whether the designed experience is hitting the mark.
  • Reliable and continuous device connectivity is critically important as digital metering is rolled out and the number of IoT (Internet of Things) sensor devices increases. Yarra Valley Water made a decision that these communication services should be provided by a specialist organisation such as a telecommunications provider. We have also decided to leverage open standards technologies to maximise our access to the global ecosystem of products and minimise the risk of a lack of backwards compatibility.
  • Despite the hype around IoT, many of the technologies are still in their infancy (first generation). Key hardware and software components such as communications modules, SIM cards, and communication and security protocols will significantly improve over time. Partnerships with technology vendors ensure user requirements are well understood and ultimately fast tracks product enhancements and shortens development cycles.
  • When considering a program of this magnitude, it is important follow a gated process. Gating ensures that the organisation has the flexibility to fail fast, learn, and reorient quickly. It also ensures that success or failure occurs in bite sized chucks - providing a higher level of assurance that the investments being made are prudent and efficient.
  • A key focus is ensuring customer bills are not impacted adversely. This is particularly challenging as the costs and benefits do not occur at the same time due to the duration of the rollout - requiring careful consideration on how to accommodate within the 5 year regulatory window.

Get in touch

For more information on Yarra Valley Water’s digital metering project, please contact Raghu Bharadwaj, Manager Digital Metering, via email [email protected].