Tag Archives: water rates

A Life-Cycle Approach to Urban Water Scarcity Pricing

O Sahin, RA Stewart, MG Porter. Water security through scarcity pricing and reverse osmosis: a system dynamics approach.  In Sustainable Development of Energy, Water and Environment Systems, Journal of Cleaner Production 2015-02-01 88:160-171

Water supply and demand planning is often conducted independently of social and economic strategies. There are presently no comprehensive life-cycle approaches to modelling urban water balances that incorporate economic feedbacks, such as tariff adjustment, which can in turn create a financing capacity for investment responses to low reservoir levels. This paper addresses this gap, and presents a system dynamics model that augments the usual water utility representation of the physical linkages of water grids, by adding inter-connected feedback loops in tariff structures, demand levels and financing capacity. The model, applied in the south-east Queensland region in Australia, enables simulation of alternatives and analysis of stocks and flows around a grid or portfolio of bulk supplies including an increasing proportion of rain-independent desalination plants. Such rain-independent water production plants complement the rain-dependent sources in the region and can potentially offer indefinite water security at a price. The study also shows how an alternative temporary drought pricing regime not only defers costly bulk supply infrastructure but actually generates greater price stability than traditional pricing approaches. The model has implications for water supply planners seeking to pro-actively plan, justify and finance portfolios of rain-dependent and rain-independent bulk water supply infrastructure. Interestingly, the modelling showed that a temporary drought pricing regime not only lowers the frequency and severity of water insecurity events but also reduces the long-run marginal cost of water supply for the region when compared to traditional reactive planning approaches that focus on restrictions to affect demand in scarcity periods.

Water pricing must be in line with reality…..not government subsidized.

E. Cabrera, M. A. Pardo, E. Cabrera Jr., F. J. Arregui. Tap Water Costs and Service Sustainability, a Close Relationship. Water Resour Manage (2013) 27:239–253. DOI 10.1007/s11269-012-0181-3

Water is currently an essential and strategic resource for society and its importance will rise in the future due to the increasing number of threats. However, water management is not currently up to par taking into consideration this well acknowledged importance. Generally speaking, water use is not efficient and loss figures are often too high. The reasons behind this situation are complex and diverse, however, in principle, they can be divided into four categories: cultural, political, social and economic. Since the latter are of most importance, this paper focuses on water costs from source to tap. The economic analysis presented quantifies the costs of a sustainable urban water service in a structured way. The second part of the paper present a case study in which the economic losses linked to leakage are assessed as a function of how expenses are recovered. The cost of apparent losses could also be assessed in a similar way and will always be higher, since apparent losses (unlike real ones) are present throughout the whole water cycle, thus increasing the unit costs.

Oceanside (CA) votes to raise water, sewer rates….

Water rates to rise ~6.5% and sewer rates up ~5%…….click here for more.

Ojai customers question Denise Kruger’s $928,103 compensation in 2011

Well, as water rates go up, expect customers to take a closer look at where the money goes……click here for news article….

Metro Water District of So. California restructures debt, saves money

Metropolitan Water District of Southern California (MWD) supplies drinking water to almost 19 million Los Angeles-area residents.  MWD paid $47.2 million to unwind interest-rate swaps with banks….and ratepayers didn’t come away with a loss. Click here for more….

California Water Service Company seeks water rate increase….

CalWater has proposed a $10-per-month rate increase, over a 3 year period…..click here and click here.

Baltimore (MD) seeks 9% water rate increase

Public hearing set for tomorrow (June 27)…..click here….