Water scarcity is the major problem confronting both urban and rural dwellers in Enugu State. This scarcity emanated from indiscriminate pipe failure, lack of adequate maintenance, uncertainty on the time of repair or replacement of pipes etc. There is no systematic approach to determining replacement or repair time of the pipes. Hence, the rule of thumb is used in making such a vital decision. The population is increasing, houses are built but the network is not expanded and the existing ones that were installed for no less than two to three decades ago are not maintained. These compounded the problem of scarcity of water in the state. Replacement or repair of water pipes when they are seen spilling water cannot solve this lingering problem. The solution can be achieved by developing an adequate predictive model for water pipe replacement. Hence, this research is aimed at providing a solution to this problem of water scarcity by suggesting a policy that will be used for better planning. The interests in this paper were to obtain a water pipe failure model, the intensity function λ(t) [failure rate], the reliability R(t) and the optimal time of replacement and they were achieved. It was observed that the failure rate of the pipes increases with time while their reliability deteriorates with time. Hence, the Optimal replacement policy is that each pipe should be replaced after 4th break when the reliability = 0.0011.