The Price of Sustainable Water Service: a Not-So-Simple Calculation

Circle of Blue, a leading information source on water issues, published an article earlier this summer entitled “The Price of Water, A Comparison of Water Rates and Usage in 30 US Cities” by Brett Walton. The article explores the different factors determining the cost of water services.

There are countless factors contributing to the cost of water service: customers’ proximity to the water, the cities’ per capita water consumption, the regions’ yearly precipitation, government subsidies, and many more.

As expected, the cost of water service varies dramatically across the country.  For an average family of four using 150 gallons per day or 4,500 gallons per month; the monthly cost of water service ranges from $27 to $224.

In most American cities, water use is declining while rates charged are rising. Since less water is being used, utility companies must raise prices for customers to provide for their costs. Western states, however, may feel the present changes less than other states. The federal government invested in major water infrastructure projects in the West over 50 years ago. The price of water service is artificially low in these areas and customers are more likely to experience “rate shock” to bridge the cost gap when investments and infrastructure repairs are made.

Proximity to water also determines water rates. Moving water takes energy and therefore energy costs are higher in drought-prone regions. Whereas the Great Lakes region, for example, may have lower energy costs associated with water delivery because of its close proximity to its water sources.

Also contributing to water service costs is crumbling water infrastructure; some of which has been in place for over 100 years. The EPA calculates that it will take $335 billion to rebuild the nation’s aging water infrastructure. As cities develop plans to reinvest in their water infrastructure, leaky pipes and broken sewers contribute to billions of dollars in lost treated water.

A 2012 study by USA TODAY of residential water rates over the past 12 years corroborates EPA’s finding and concludes that crumbling infrastructure is forcing repairs from coast to coast, with residential water rate costs more than doubling in 1 of 4 or 25% of all localities.

Walton similarly concludes that sustainable water service costs money. Prices will change for this valuable service, and not necessarily in the most desirable direction.

**Note – Circle of Blue Data Updated in 2013 shows price of water up nearly 7% in the last three years:  http://www.circleofblue.org/waternews/2013/world/the-price-of-water-2013-up-nearly-7-percent-in-last-year-in-30-major-u-s-cities-25-percent-rise-since-2010/

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