Finding Economic Optimality in Leakage Reduction: A Cost-simulation Approach for Complex Urban Supply Systems

AbstractThe optimal economic level in leakage reduction must be defined when reaching equilibrium between marginal costs of saved water and marginal costs of achieving additional reduction in leakage (Farley and Trow, 2003). This concept is used to deal with the question of what the target in reducing leakage should be and how related costs can be justified. Nevertheless, when negotiating for optimal decisions considering complex multi-centre (or multi-district) supply systems, subject to reduced water resources and reduced funds, the problem could be much more difficult to define and analyze. Mainly, in this situation, the optimal economic problem can be modified in finding the priorities in investment for leakage reductions between the centres in the supply network. This paper is related to these aspects; it mainly focuses on finding a reliable and correctly justified cost- function attribution for the water in multi-source and multi-centre systems