A review of Performance Indicators adopted by the Italian Regulation Authority (ARERA) to target water losses in supply networks

Performance Indicators for measuring water losses in water distribution networks are often criticized. Even recently some shortcomings have been highlighted with regard of the performance indicators “percentage water losses” and “linear water losses” also adopted by the Regulation of the Technical Quality (RQTI) introduced by the Italian Authority ARERA in 2017. But alternative proposals are struggling to gain general consensus. Striving for greater precision in measuring variables can increase the comparability of data, but it risks burdening the entire process, failing to address the problem of the apparently incompleteness and inherent uncertainty of the indicators. The same goes when seeking to improve the models, accounting for more explanatory factors, due to the uncertainty or indeterminacy. This is a longstanding problem, that we also encountered during the “Benchmarking Club” initiative among Italian water companies, conducted in the early 2000s under the patronage of the Federgasacqua. This paper aims to share some insights from that benchmarking experience, in an attempt to contribute to the ongoing debate through a deeper understanding about these indicators and their use.

Keywords: water losses, benchmarking, uncertainty, regulation

Jel codes: L95, L51, Q25

Sergio Garbarino, Considerazioni sugli indicatori di prestazione adottati dall’Autorità di Regolazione Italiana (ARERA) per contrastare le perdite idriche nelle reti di acquedotto in "ECONOMIA PUBBLICA " 3/2025, pp 427-449, DOI: 10.3280/EP2025-003005