The world’s water networks run on pipe, lots of it, from the 3-inch water main in your house to tunnels big enough to stand up in. Most of that pipe is pretty cheap, as compared to, say, an electric distribution substation, even if you need an entire substation to run the pumps at the great central water systems like California’s aqueducts.

But it’s also dark cable, so to speak: metal, cement or plastic tubes that slowly degrade over time, unseen by the men and women who operate the system. Sure, major pipelines are watched for leaks, and “pigs,” or hydraulic rams that travel through pipes to clean them, can also check for weaknesses or other anomalies that indicate a fault is coming sooner than expected.

But pigging pipe is expensive, and only works for big water mains. In the meantime, smaller pipes decay away, leading to “non-revenue” losses -- water that’s lost or stolen -- that the World Bank estimates at $14 billion annually. In the United States, much of the 880,000 miles of water pipes in place are decades or even a century old, and can be a significant source of water loss, according to the Environmental Protection Agency.

It would be nice to be able to check whether pipes were about to fail, or how much water they were losing per mile, without replacing them. That’s a problem worth solving for anyone trying to sell so-called “smart water” technologies into the $365 billion global water utility market.

Echologics, a startup bought for $8 million in late 2010 by fire hydrant and water metering giant Mueller Water Products (NYSE: MWE), has a technology that it thinks can help solve the problem, via sound waves. Acoustic monitoring of pipe isn’t new -- various water metering and infrastructure vendors, such as Itron, offer versions of it, and other water AMI (advanced metering infrastructure) competitors like Badger Meter and Neptune support the collection and analysis of acoustic data in their AMI systems.

But Mark Bracken, vice president and general manager at Echologics Engineering, said in an interview last month that his company’s technology, developed at the National Research Council of Canada, includes specialized versions of “guided wave” technology used in other industries like oil and gas that are unlike others in use in the water industry today. These can both listen to pipe for defects and actively induce acoustic waves to check pipe-wall thickness and other such physical measurements, he said. Notably, they can work on certain plastic (PVC) and cement pipes as well as water pipes, he added. 

Echologics has deployed its system with multiple utilities, including a two-year project to help the hard-pressed Sewerage & Water Board of New Orleans detect leaks and assess the condition of water mains. On the drier side, it’s working with the Las Vegas Valley Water Department on a one-year contract that could grow to five years, based on a 2011 pilot that showed Echologics could monitor the cement-and-mortar pipes that run under the Las Vegas strip.

Mueller has put Echologics’ technology into its broader deployments “at full force,” Jim Fisher, Echologics’ manager of non-revenue water, told me. Those include smart meter (AMI) deployments for municipal utilities across the country, as well as software to manage the data that flows in from these devices.

Leak detection and analysis have been part of the water industry since the 1920s, Fisher explained, but data has been hard to come by. Even differentiating meter error from real losses has been a challenge for the industry -- 20-year-old water meters may only be 80-percent accurate, he noted. Echologics and Mueller pull meter data into geographic information system (GIS) templates to match incoming AMI data to check for errors, leakage or theft, he said.

While water meters aren’t being replaced by two-way communicating “smart” meters at the same rate as electric meters have been, the GTM Scott AMI Market Tracker predicts 2012 will see 5.5 million smart water meters networked across the United States, up slightly from 5.3 million in 2011. Leading vendors in the water metering space, in order of 2011 U.S. shipment volumes, were Neptune, Itron, Badger Meter, Sensus, Master Meter, Aclara, Elster and Datamatic, according to GTM market data.

Mueller is doing its own share of municipal water AMI projects, trying to move beyond simple cash-register-type functions and into the world of asset management and preventative maintenance, Bracken said. If utilities can delay the scheduled replacement of several miles of pipe at $1 million per mile because Echologics’ system tells them it’s still OK, that can pay for the cost of deploying the acoustic sensors and IT interconnections in one fell swoop, he noted.

Of course, paybacks differ from utility to utility, making it hard to measure average savings and return on investments, he said. The U.S. water industry is a highly fragmented market, with about 55,000 water utilities, compared to about 3,195 electric utilities. Most are municipal water utilities, which is different than the situation in Europe, which has more private water companies that may be more willing to invest in high-tech monitoring solutions, as well as the in-house IT smarts to manage such a system, he noted.

IBM has been moving into the water utility space in a big way, with projects ranging from the vineyards of California’s Sonoma County to the corn belt city of Dubuque, Iowa, as well as projects abroad in Malta, Australia and Japan, to name a few examples. There’s certainly a need for IT integration for big-city water utilities, and for the smaller guys, IBM is considering a software-as-a-service model to help lower cost and complexity of deployment.

The U.S. water industry also had a little-noted stimulus package, in the form of about $6 billion in EPA grants, to finance “high-priority water infrastructure projects” around the country. The program handed out about $5.6 billion in 3,200 separate assistance agreements as of 2010, giving the water industry a boost even greater than the smart grid industry’s $3.9 billion in stimulus grants.

To be sure, most of that $3.8 billion for wastewater projects and $1.8 billion for drinking water projects no doubt went toward hard infrastructure improvements like pipes and concrete, as well as the labor required to get the jobs done. Just what share may trickle down to new “smart water” technologies like Echologics is hard to predict. There's no doubt that the industry is watching new deployments for assurance that they can deliver the efficiency improvements they’re promising. There’s about $14 billion in wasted water to be regained if they can pull it off.  

Tags: ami, badger, echologics, elster, ibm, itron, mueller, neptune, sensus, smart grid, smart meter, utilities, water