Why Perlis’s water woes remain hard to resolve

 After years of reforms, targets and investments, the question remains unchanged: why is the non-revenue water rate still so high?

From Firdaus Abdullah

Perlis is facing a growing water paradox.

While falling levels at the Timah Tasoh dam raised concerns again in August, the state’s most serious problem is not how much raw water remains in storage, but how much treated water fails to generate revenue after entering the distribution system.

On Aug 28, the National Water Services Commission (SPAN) said the Timah Tasoh dam had gone from critical to alert level following rainfall and the pumping of water from nearby ponds into the reservoir.

The improvement offered some relief, but it did not remove more fundamental questions about the resilience of Perlis’s water supply system.

The Dewan Negara was told on July 28 that Perlis recorded a non-revenue water (NRW) rate of 62.3%. In comparison, the average NRW rate for Peninsular Malaysia and Labuan was 34.4%, according to SPAN data from 2025.

NRW refers to treated water that does not generate revenue because of leakages, burst pipes, overflows, meter inaccuracies, illegal consumption, data errors and other authorised but unbilled uses.

Nevertheless, the auditor-general’s (A-G) report on Syarikat Air Perlis (SAP) indicates that physical losses form the dominant component of the NRW in the state.

Based on SAP’s water balance reports, physical losses accounted for 79.4% of the NRW in 2022, 80.4% in 2023 and 80% in 2024.

In other words, problems involving pipes and the physical distribution network are not a peripheral issue. They lie at the heart of Perlis’s water challenge.

The problem has, in fact, been recognised for years.

During the opening of the Perlis assembly in August 2021, the Raja of Perlis noted that the state’s NRW rate remained high at 63.2%. He also acknowledged five Putrajaya-funded projects worth RM205 million to repair and upgrade the state’s water supply system, while expressing hope that the NRW could eventually be reduced to 30%.

Before that, the federal government also implemented the National NRW Programme, Approach 1, in Perlis at a cost of RM39.8 million.

The project, which began on Feb 20, 2020 and was completed on Dec 15, 2022, involved replacing system input volume meters and consumer meters as well as repairs and replacement work involving storage tanks.

A major restructuring of the state’s water industry was also completed in March 2021, with Putrajaya writing off RM185.41 million in state water-supply loans, while a further RM45.33 million was taken over by Pengurusan Aset Air Bhd and restructured through a lease arrangement.

These measures were intended to place Perlis and SAP on stronger financial footing. Yet, several years later, the NRW remains above 60%.

During a Perlis assembly sitting in August 2023, assemblymen raised concerns over pipes said to be almost 40 years old, as well as underground leakages that were difficult to detect.

The state government acknowledged that such problems affected several areas, including Titi Tinggi, Chuping and Kuala Perlis. It illustrated the scale of the problem by suggesting that, out of every 100 units of water produced, only around 35 units reached consumers at the time.

This helps explain why pipe replacement has become a central component of the proposed solution.

Under the 13th Malaysia Plan, RM436.5 million has been allocated to reduce the NRW in Perlis. In July, the government said the overall figure had risen to RM447 million.

This means the government has embarked on another major round of investment involving critical pipe replacement and a more comprehensive NRW reduction programme. But the key question is whether this expenditure will finally produce a sustained decline in water losses.

The A-G’s report offers another indication of the system’s vulnerability.

Perlis recorded a water reserve margin of -1.3% in 2022, before improving to 4% in 2023 and 11.3% in 2024. Although this represents progress, the 2024 figure remained below the minimum 15% reserve margin referred to in relevant technical guidelines.

This means Perlis still has limited spare capacity when confronted with rising demand, treatment-plant disruption or a decline in raw water availability.

It is at this point that the Timah Tasoh issue and NRW converge.

The dam supplies raw water. Treatment plants convert that raw water into treated water. But when the distribution network continues to record an NRW of more than 60%, pressure on the entire system becomes significantly greater whenever raw water resources begin to decline.

More accurately, the NRW acts as a risk multiplier. It does not cause drought, but it can make a water supply system considerably more vulnerable when drought occurs.

Perlis is also dealing with more than a technical infrastructure problem. The A-G reported that SAP accumulated losses of RM70.23 million by the end of 2024, although the company recorded a pre-tax profit of RM0.88 million that financial year.

For that reason, the success of Perlis’s water programmes should not be measured simply by the amount of money allocated or the number of projects announced.

More meaningful indicators are how many kilometres of critical pipes are actually replaced, how quickly leaks are detected and repaired, whether water pressure becomes more stable and, most importantly, whether the NRW rate falls consistently from its current level of above 60%.

Timah Tasoh may receive more rainfall. Treatment capacity can also be expanded and new pipes installed.

But after years of reforms, targets and investments, the most important question facing Perlis remains unchanged: why is the NRW still so high?

The answer will determine whether the hundreds of millions of ringgit being spent will mark a genuine turning point, or merely another round of repairs for a water problem that has persisted for far too long. - FMT

Firdaus Abdullah is a senior lecturer at Universiti Kebangsaan Malaysia whose expertise is in Malaysia’s water development.

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.