1. (a) Except as provided in subdivision (d), each urban retail water supplier's real water loss standard shall be based on the formula identified in subdivision (b), with the following inputs based on each supplier's own data or the default value:

   1. (1) Annual background leakage:

      Annual background leakage shall be calculated as follows:

      

   2. (2) Annual reported leakage:

      Annual reported leakage shall be calculated as follows:

      

   3. (3) Annual unreported leakage:

      Annual unreported leakage shall be calculated by deducting annual background leakage and annual reported leakage from average baseline real loss.

   4. (4) Months taken to survey whole system:

      Months taken to survey whole system shall be calculated by dividing average length of mains by average leak detection survey frequency.

   5. (5) Part of system:

      Each part represents the amount of the system that can be surveyed each month, such that the number of parts in a system is equal to the number of months needed to survey the whole system.

   6. (6) Unreported leakage per part of system:

      Unreported leakage per part of system shall be calculated by dividing annual unreported leakage by months taken to survey whole system.

   7. (7) Rate of rise of leakage per part of system:

      Rate of rise of leakage per part of system shall be calculated by dividing rate of rise of leakage by months taken to survey whole system.

   8. (8) Monthly water lost due to backlog of unreported leakage:

      Monthly water lost due to backlog of unreported leakage shall be calculated as follows:

      

   9. (9) Monthly water lost from rising leakage in never surveyed parts of the system: Monthly water lost from rising leakage prior to first leak survey shall be calculated as follows:

      

   10. (10) Monthly water lost from rising leakage in previously surveyed parts of the system:

       1. (A) Before one full leak detection survey has been completed, the monthly water lost from rising leakage in previously surveyed parts of the system shall be calculated as follows:

          

       2. (B) After the entire system has been surveyed once, the monthly water lost from rising leakage in previously surveyed parts of the system shall be calculated as follows:

          

   11. (11) Monthly unreported real loss with intervention:

       Monthly unreported real loss with intervention shall be the sum of monthly water lost due to backlog of unreported leakage, monthly water lost from rising leakage in never surveyed parts of the system, and monthly water lost from rising leakage in previously surveyed parts of the system.

   12. (12) Monthly unreported real loss without intervention:

       Monthly unreported real loss without intervention shall be calculated as follows:

       

   13. (13) Water saved in month of implementation:

       Water saved in month of implementation shall be calculated by deducting monthly unreported real loss with intervention from monthly unreported real loss without intervention.

   14. (14) Marginal avoided cost of water:

       1. (A) At the beginning of 2022, the marginal avoided cost of water shall be calculated as follows:

          

       2. (B) After 2022 begins, the marginal avoided cost of water shall be calculated as follows:

          

   15. (15) Value of water loss reduced in each month:

       Value of water loss reduced in each month shall be calculated as follows:

       (water loss occuring without intervention - water loss occuring with intervention) x Marginal cost of water in each time step

   16. (16) Present value of water loss reduced each month:

       Present value of water loss reduced each month shall be calculated as follows:

       

   17. (17) Cost of leak detection during each month:

       Cost of leak detection during each month shall be the product of average leak detection survey frequency in miles surveyed each month and average cost of leak detection surveying per mile.

   18. (18) Initial leakage level for part surveyed each month:

       1. (A) Before one full leak detection survey has been completed, then unreported leakage per month shall be calculated as follows:

          

       2. (B) After the entire system has been surveyed once, unreported leakage per month shall be calculated as follows:

          

   19. (19) Average volume per leak per year:

       Average volume per leak per year shall be calculated as follows:

       

   20. (20) Volume of leakage from mains:

       Volume of leakage from mains per leak per year shall be calculated as follows:

       

   21. (21) Volume of leakage from service connections:

       Volume of leakage from service connections per leak per year shall be calculated as follows:

       

   22. (22) Leaks found per part of the system:

       Leaks found per part of the system is calculated for each month as follows:

       

   23. (23) Cost of leak repair during each month:

       Cost of leak repair during each month shall be calculated as follows:

       

   24. (24) Total leak detection and repair cost for each month:

       Total leak detection and repair cost for each month shall be the sum of cost of leak detection during each month plus cost of leak repair during each month.

   25. (25) Present value of cost for each month:

       Present value of cost for each month shall be calculated as follows:

       

   26. (26) Present value of net benefit in month of implementation:

       Present value of net benefit in month of implementation shall be calculated by deducting present value of cost for each month from present value of benefit for each month.

   27. (27) Present value of net benefit over 30 years:

       Present value of net benefit over 30 years is the sum of present value of net benefit in month of implementation summed from January 1, 2022, through December 31, 2051.

   28. (28) Benefit to cost ratio until 2028:

       The Benefit to cost ratio until 2028 is the sum of present value of benefit for each month from January 2022 through December 2027 divided by the sum of the present value of cost for each month from January 2022 through December 2027.

2. (b) Each urban retail water supplier's real water loss standard shall be as follows:

   1. (1) If the present value of net benefit over 30 years is negative, the real water loss standard is equal to the average baseline real loss.
   2. (2) If the present value of net benefit over 30 years is zero or positive, the real water loss standard is equal to the sum of annual background leakage plus annual reported leakage plus unreported leakage for 2027.

3. (c) For purposes of subdivision (a) of this section, each input value, except real discount rate, average annual rise in price of water, and effective timeline for lifecycle benefit-cost analysis, shall be either the default value identified in section 980, or the supplier's own value if adequately supported by documentation submitted to the board. Average annual rise in price of water shall be either the default value identified in section 980 or the supplier's own value if the requirements in section 984 subdivision (b) are met. If the board concludes that any specific value used by a supplier is not adequately supported by documentation, the board shall promptly communicate that deficiency to the supplier with a timeline within which to cure the deficiency.

   1. (A) The supplier does not show a year-to-year variability higher than 10 gallons per connection per day for real loss on any annual audit for the years used to calculate the average real loss pursuant to paragraph (3) of this subdivision.
   2. (B) For a supplier that has reported a negative value for its real loss for any of the years used to calculate the average real loss pursuant to paragraph (3) of this subdivision, it has identified the cause for the negative value and documented the steps taken to correct it.
   3. (C) The supplier's water from own sources, imported water, and exported water are completely metered.
   4. (D) If the supplier's water from own sources is greater than 5% of the total water supplied, the supplier demonstrates that meters measuring at least 95% of the total produced volume are tested on at least an annual basis.
   5. (E) If the supplier's imported water volume is greater than 5% of the total water supplied, the supplier demonstrates that meters measuring at least 95% of the total imported volume are calibrated on at least an annual basis.
   6. (F) If the supplier's exported water volume is greater than 5% of the total water supplied, the supplier demonstrates that meters measuring at least 95% of the total exported volume are tested on at least an annual basis.
   7. (G) All customer accounts, excluding those providing fire-flow, are metered, with at least 90% success rates in meter reading.
   8. (H) A statistically significant sample of customer meters, as determined by the supplier, or 300 meters, whichever is lower, are tested annually.
   9. (I) If the unbilled metered water volume is higher than 1% of the total water supplied, the supplier reads the meters for accounts that are supplied through unbilled metered water accounts at the same or greater frequency as the supplier reads the meters for the majority of customers.
   10. (2) If a supplier that meets the criteria of this subdivision, except that it is unable to meet the criteria for paragraphs (D), (E), or (F) of subdivision (d)(1) due to aspects outside of its control, such as not having access to calibrate water meters owned by other entities or not being able to move large meters, then it may petition to be exempted from criteria involving only those aspects outside of their control. This petition may be granted at the discretion of the Board and may include provisions, such as a requirement to calibrate rather than test a meter or to request in writing that water meters be tested and/or calibrated by the entities that own them.

   11. (3) For the purposes of this subdivision, average real loss shall be calculated using the following years of data:

       1. (A) The original baseline period, which consists of data for the years 2017, 2018, 2019, and 2020, provided the submission is received by July 1, 2023; or
       2. (B) Data for any three consecutive years, provided those years are within five years of the submission date.
   12. (4) This subdivision shall only apply to urban retail water suppliers that submit supporting documentation to demonstrate that their average baseline real loss is 16 gallons per connection per day or less and that they have met the data quality criteria of this subdivision. Submissions on or before July 1, 2023, will take effect immediately. Submissions received after July 1, 2023, will take effect in the next compliance period, exempting suppliers from the reporting requirements in section 983 for subsequent compliance periods.

   (d)(1) Suppliers may apply for a real water loss standard of 16 gallons per connection per day if the supplier has an average baseline real loss of 16 gallons per connection per day or less and the supplier also meets the following criteria for its annual audits:

Note: Authority cited: Sections 1058, 10608.34, Water Code. Reference: Article X, Section 2, California Constitution; Section 116275, Health and Safety Code; Sections 102, 104, 105, 350, 516, 1846, 10608.12 and 10608.34, Water Code.

History

1. New section filed 2-6-2023; operative 4-1-2023 (Register 2023, No. 6).