From Pilots to Partners: How AI Is Entering Water Utilities

European utilities are cautiously exploring AI-based leak detection, using pilots and partnerships to better manage water loss and aging networks

17 Sep 2025

Europe’s water utilities are increasingly turning to partnerships with technology providers to explore how artificial intelligence can help reduce water loss from ageing networks, favouring collaboration and pilot projects over large-scale transformation.

Rather than developing systems in-house, many utilities are working with specialist vendors and global technology companies to test digital tools within existing operations. These partnerships allow utilities to experiment with new approaches while limiting risk and upfront investment.

A commonly cited example is the collaboration between FIDO Tech and Microsoft, which began in 2023. The partnership combines Microsoft’s cloud and data capabilities with FIDO Tech’s AI models, which analyse acoustic signals from water pipes to identify potential leaks. Pilot deployments in parts of London and within the Thames Water network have been used to demonstrate how joint solutions can help utilities focus inspections on higher-risk areas without widespread excavation.

Although such projects remain limited in scale, they are often referenced by industry participants as evidence of how partnerships can accelerate learning and shorten deployment timelines. Utilities gain access to advanced analytics, while technology providers benefit from real-world testing environments and long-term commercial relationships.

Industry commentary suggests that collaboration is becoming as important as the technology itself. Utilities face mounting pressure from climate stress, rising operating costs and ageing assets, but many lack the internal capabilities to manage complex data systems alone. Partnerships offer a way to improve how existing data is used, rather than simply collecting more of it.

The focus has so far been on cooperative models such as joint pilots, integrated platforms and service agreements, rather than mergers or acquisitions. These arrangements are designed to fit within regulated operating structures and to integrate with legacy infrastructure that dominates much of Europe’s water sector.

Regulatory requirements around non-revenue water continue to shape these efforts. Ongoing obligations to monitor and report losses reinforce the case for working with external partners that can provide better visibility and analytical support, even if measurable improvements take time to materialise.

Challenges remain, including data governance, cybersecurity and staff training. Integrating partner-led digital tools into decades-old networks is often complex. Even so, utilities appear willing to continue cautious experimentation.

Looking ahead, partnerships are likely to remain the primary route through which AI-driven leak detection develops. Incremental progress through collaboration is shaping expectations about how digital tools can support Europe’s water utilities over the longer term.