In the city of Cedar Hill, Texas, about 15 miles from Dallas, officials realized that the population was growing and that drought and other factors were bound to drive up water costs for residents and businesses.
"Texas doesn't have nearly the issues other states have with water resources, but we're not exempt from problems," said Melissa Valadez-Cummings, assistant city manager for Cedar Hill, in a recent interview.
Many people, incorrectly, have adopted an "unlimited water resource mentality, but we realized we should do what's right for the environment and the region and what's right by the citizens. A lot of cities are in the same situation," Valadez-Cummings said.
One big factor Cedar Hill faced was how much water the community of 46,000 people was losing. "We were buying 3 billion gallons a year and only selling two-thirds of that. We had a 35% unaccounted loss," she said.
The biggest part of that loss wasn't leaks in the ground. Instead, a comprehensive review with water utility software-as-a-service provider Fathom, based in Phoenix, found that the biggest problem was meters that weren't being billed or were billed for the wrong amount.
The city worked with Fathom to replace older meters, which had to be manually read by workers, with 16,000 wireless meters that show customers their water consumption at their homes and businesses. Fathom also set up software to streamline the city's utility billing and revenue management.
With the Fathom system, customers can record average monthly water usage, then get email or text alerts when water usage is exceeding that rate within hours of when the water flow increases. A customer might discover a leaky toilet or pipe weeks before the monthly bill arrives, a potentially big savings on water and the cost for the water.
"This approach has really given people the tools to manage consumption before the bill comes in," Valadez-Cummings said.
She said city officials discovered Fathom at a conference and compared its software and system to those from Honeywell and Johnson Controls, but found Fathom had a more comprehensive approach.
The meters and software and system upgrades cost the city about $9 million. The city water utility expects to recoup that cost because of various efficiencies from the Fathom system in about seven years — half the normal 15 years expected for a major capital improvement.
In addition to the utility's efficiencies, "the rate payers love it because they reduce the window of finding out they experienced a leak, so it helps their pocket book," Valadez-Cummings said.
On the billing side, consumers also get features that allow easier access to their billing history. Water utilities typically have older billing systems that are based on one utility comparing itself to another water utility nearby. The Fathom billing system is more comparable to how consumers pay for cable or Internet services, Valadez-Cummings said.
Fathom's software and systems support about 4 million water meters in about 200 utilities in the U.S., said Fathom President Jason Bethke. Municipalities run about 85% of all water utilities in the nation, he estimated.
"Our primary mission is to help utilities adopt technology to be more financially stable, and the benefit is that customers use less water," Bethke said. Fathom's utility customers see an average increase in revenue of 10% while also seeing a reduction in water usage of 10%. "They are making more money with less water."
Bethke said Cedar Hill is fairly typical of other utilities where the water loss is not a function of actually leaking water into the ground but of losing track of the data, such as when a customer is billed for 50 gallons instead of 500 gallons.
Bethke said Fathom has found a sweet spot in serving the many smaller water utilities that couldn't afford to create and install new software to analyze water usage data and provide billing. With a SaaS approach, Fathom has brought "an economy of scale to a fragmented system," he said.
Valadez-Cummings said one environmental perk of the Fathom system is that the meters send their data wirelessly to 24 data collectors that are solar powered, keeping them off the energy grid. The data collected is then sent to the cloud, managed and analyzed by Fathom.
Analyst firm Frost & Sullivan evaluated Fathom's performance for a group of its customers in a recent white paper and found an increase of 20% in revenues, while decreasing water consumption by customers by more than 20%.
"Fathom has been able to achieve this success in many ways due to its organized development with the water utility industry and its strong IT-focused understanding of the smart water landscape," Frost & Sullivan said.
Zeus Kerravala, an analyst at ZK Research who researches Internet of Things technology, said wireless meters for measuring both water and electricity usage are emerging on the technology scene and offer substantial advantages.
"That technology is in its early stages, and utilities are seeing how it saves money," he said in an interview. "A little awareness by consumers of waste can change a behavior. And with water shortages, that's a good thing to do."