Municipal water systems throughout the world face a host of financial challenges. Unfortunately financial management tools for water utilities lag behind other sectors, leaving utilities highly vulnerable to weak financial performance and market changes. The consequences for not meeting financial challenges are serious. Companies see severe anger over rate hikes, layoffs, lawsuits and failing infrastructure such as burst pipes.
A company called Valor Water Analytics hopes to equip water utilities with customer sales metrics and analytics to strengthen financial performance and streamline operations. Analytics such as rate structure impacts, key performance indicators (KPI) and benchmarking provide decision makers with key information of water management issues.
Valor utility solutions measures the impact of drought on revenue so utilities can develop plans for future revenue resilience. For example, Valor helped 4 south eastern utilities develop targeted rate reserve vents to cover financial losses during future droughts. Taking it further, their solution can also allow companies to segment customers according to water use patterns to identify groups for targeted programming and communications.
In another example, Valor found that 6% of households were doing heavy irrigating from their indoor taps, equivalent to $1.6 million in revenue. This list of flagged customers provided to the utility was used to target these hidden irrigators for outdoor meter installation allowing the utility to charge a higher rate and cut off outdoor meters during droughts.
There is no doubt that increasing water shortages and mounting water delivery costs threaten lively hood and economies but with every crisis comes opportunity. Companies like Valor hope to move the dial forward in data capturing efficiencies and improving performance. Business intelligence and analytics tools can guide utilities to be resilient to change in delivering clean and affordable water, enabling them to face the future with confidence.