Half of the country's water supply is being lost to leaks throughout the network - a much higher level than previously thought, the Sunday Independent can reveal.
Irish Water documents obtained by this newspaper, reveal the chronic state of the water network.
The company has discovered that much of the leaking is not on the national network, but actually in pipes on private properties.
Highlighting the incredibly high level of leakage, a new Irish Water survey revealed that of 1,600 homes surveyed, it was discovered that 20 homes alone were using one million litres of water a day. This equals the amount of water used by 9,000 people, or the entire population of the town of Gorey in Co Wexford.
The Irish water documents state: "Across the network, leakage is now estimated to be in the region of 49pc, as opposed to the originally estimated 41pc.
"Under investment over a prolonged period of time, this has resulted in Irish Water taking responsibility for a network, requiring a radical new approach in terms of funding and investment," the documents added.
With billing to begin on October 1, homeowners across the country are being urged to monitor their meters to determine whether they have a leaking problem.
In order to address the crisis, Irish Water has set aside more than €50m to cover its 'First Fix' programme, which will allow homeowners to have their leaky pipes fixed for free from January 1.
"Irish Water is finalising plans for the First Fix scheme which is on target to be rolled out early next year," the company told the Sunday Independent. It has emerged that 22pc of the water supplied to domestic customers is used by 1pc of households - indicating a high level of leakage on some properties.
According to Irish Water, the roll out of metering has made the detection of leaks on customer properties possible for the first time and allowed it to "identify customer side leakage."
Controversially, Irish Water is now arguing that the study shows Irish people use less water than previously thought and as a result the company has reduced the free daily allowances people will receive once billing begins.
The company has already secured agreement from the Commission on Energy Regulation to almost halve the proposed free allowance for children from 38,000 litres a year to 21,000 or 58 litres a day. This would allow the child to have one seven-minute shower and one use of the toilet.
Larger families with adult children living at home are set to pay most for water.
However, the company is adamant that Irish people are using less water, and therefore allowances can be lower.
"The study reveals that Irish households are using significantly less water than previously estimated. The average annual usage per person is approximately 40,000 litres or 111 litres per person per day. Previous studies indicated this figure to be in the region of 145 litres," the documents state.
Irish Water now figure that each household will use at least 66,000 litres per year or 181 litres per day.
For every additional person living in the house increases the usage by 21,000 litres a year.