CASA Weighs in on Volumetric Pricing Recommendation in Draft California Water Plan Update.
On September 28, 2012, CASA sent a letter to the California Department of Water Resources (DWR) commenting Chapter 3 of the plan, titled “Water Use Efficiency.” The current draft of the plan calls for “DWR in partnership with CUWCC and water agencies [to] lead an investigation to analyze and evaluate the effectiveness of rate structures in use by various water supply and wastewater agencies.” Though the recommendation is fairly benign, CASA believes it is important to weigh in now and alert DWR to the complexities of this issue, given the push by some nongovernmental organizations to mandate volumetric wastewater rates. The letter highlights a number of considerations that caution against any recommendation that all sewer agencies regardless of circumstances should be directed or mandated to implement volumetric rates.
First, there are little or no empirical data to establish that volumetric pricing of sewer services has actually resulted in any water conservation. It would be very difficult to document whether any water was conserved as a result of volumetric wastewater rates because so many other water conservation incentives are available in much of California, particularly in the urban context. Second, flow is not the major cost-driver for wastewater agencies, and fixed costs comprise a large portion of rates (on the order of 70-90%). Third, in much of the state, water rates tend to be much higher than sewer rates, making the relative theoretical impact of volumetric sewer rates even smaller. CASA Comment Letter on Urban Water Use Efficiency Chapter of the 2013 Update of the California Water Plan.
In addition, several representatives of the wastewater community are participating in a facilitated stakeholder group convened at the behest of the Natural Resources Defense Council to examine the role of wastewater rates in influencing water conservation, the considerations and complexities of wastewater rate setting and billing, and the legal authorities and constraints that must be taken into account in any discussion of volumetric rates for wastewater. The wastewater stakeholders have maintained from the outset that whether to establish volumetric pricing must be a local decision made by the local governing board based on a community’s particular circumstances.
