BiWAS self-financing

BiWAS will change the way we monitor water today, and that might affect the economics of the water industry as well as the society.

As of today, there are two methods for monitoring contaminants in drinking water; direct and indirect monitoring. Indirect indicators are physical parameters such as conductivity, turbidity, color and pH. These physical parameters can indirectly, continuously monitor the presence of contaminants. However, there will always be a level of uncertainty related to their measurements and results, as they cannot always detect the presence of contaminants, or they might set off a false alarm. This is where direct monitoring comes in handy. Direct monitoring is very time-consuming and extremely costly, as manual samples have to be collected and analyzed in a laboratory. The results from direct monitoring are accurate and precise, but since they are not continuous, they show only the water quality for a specific point in time. Therefore, there will always be uncertainty regarding the water quality.

Continuous monitoring placed directly into the distribution network in several critical locations will make it possible to increase certainty about water quality to a whole new level, without increasing the monitoring costs.

The financial benefits of investing in BiWAS technology

The costs of manually monitoring the water quality are very large and a significant amount of water quality tests done today are negative. Meaning that they show no sign of water contamination. A reduction in the number of negative manual tests will greatly reduce the overall cost of water monitoring.

The BiWAS technology aims to reduce the total amount of negative tests. It combines a direct and continuous monitoring method and so give a near real-time measurement of the water quality. The BiWAS technology indicates when and where manual testing is necessary and in turn dramatically reduces the number of manual tests needed. Early-stage calculations show that the cost of investing in the BiWAS technology will be fully covered by the cost-reduction from the reduced number of manual monitoring tests performed.

Financial gain
Total financial gain

In short this means that the BiWAS technology is assumed to be self-financing. In addition, society and consumers are to some extent willing to pay slightly more for an increase in water security and quality. Water distributors will therefore have the opportunity to transfer some of the investment costs onto the consumers, even when the overall monitoring costs have been reduced.

Social benefit of investing in BiWAS technology

The financial burden on a society when people fall sick is usually higher than the cost of providing clean water, as it includes a loss in productivity, increased health care expenses and the utility loss from being sick. Reducing the water quality uncertainty will reduce the financial burden on society from people falling sick after drinking contaminated water. Reduced uncertainty means that the population can choose to drink bottled water, or water from an alternative water source, instead of contaminated water, for as long as the main water source is contaminated.

In the case of water contamination a few scenarios can play out. In the first scenario, the contamination is detected before anyone becomes sick. The government issues a statement warning about the contamination and provides clean water from an alternative water source while the contamination is dealt with. In the second scenario, the contamination is not detected before a small or large number of people become sick. The government now have to provide treatment to those who have fallen ill and an alternative source of clean water for the rest while dealing with the contamination.

Naturally, the financial burden of people falling sick is normally much higher than the cost of providing alternative clean water, even if only a fraction of those exposed to the contaminated water become sick.

The risk of contamination in the water is dependent on the physical characteristics of the water such as; its location, the surrounding sources of contamination and the local climate. The societal costs from contamination in the water is increasing with the level of uncertainty about water quality and the risk of contamination in the water. If there is no risk of contaminated water, there is no need to measure contamination, and if there is full certainty about water quality at all times, no one would fall sick from drinking contaminated water. In the real world there is both a risk of contamination in the water and uncertainty about water quality. Depending on the number of people at risk and the costs of providing alternative clean water, there are potentially high gains from reducing the water quality uncertainty.

It is important to emphasize that the cost of providing alternative water resources and the costs of people falling sick will vary greatly from one place to another, and that the graph presented below is only an illustration.

Societal gain
Figure 1: The financial benefit for a society grow with the risk of contamination

Reducing uncertainty can be done by either monitoring water more frequently or installing continuous monitoring technologies.