New Zealand software firm Derceto has signed a $1.3 million contract to deliver cost-saving initiatives to South Korean utility company K Water.

The software will first be implemented at K Water's Cheongju water system, and if successful, could be used across all the company's plants.

K Water is responsible for the entire water supply of South Korea.

K Water's energy audit team manager Han Yung Park said the software would be an important tool in minimising energy use, managing the water system more efficiently to maximise quality and reduce waste, and reduce greenhouse gas emissions.

He said the company was in a good position to roll out new technologies quickly.

Derceto chief technology officer Simon Bunn said the software automatically programmed the water system to fill large water tanks, supplying cities, suburban areas and industry with water, during off-peak times.

This meant the company paid less in power because it was using electricity during periods of reduced demand and pumped a lot of water out and back to treat facilities during the night.

Bunn said utility companies around the world were focused on reducing energy consumption, which was giving Derceto penetration in international markets.

"It's about being a good corporate citizen. Companies are looking at the lowest cost path to get water out."

Derceto has clients in the United States, Canada, New Zealand and Australia.