4 Keys to Creating a Useful Utility Rate Sheet

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A customer calls and wants to know the water and sewer rates in his town. What do you say? Do you direct him to your website? Tell him to swing by town hall or your office and pick up a pamphlet? Can you describe your rates quickly over the phone?

Keeping customers informed of the most up-to-date water and sewer rates keeps all parties on the same page. While there is much more to communication between utilities and their customers than only rate sheets themselves, making this information readily available in the form of readable and intuitive rate sheets is a step in the right direction. At the EFC we see a lot of rate sheets, through our work in the Smart Management for Small Water Systems project, various surveys for statewide water and wastewater rates dashboards, and other work. The rate sheets we have seen run the gamut, from clear and concise, to convoluted and labyrinthine, to essentially non-existent. This post summarizes four best practices for creating a good utility rate sheet that we have learned over the years.

1. Have One

The first step in having a readable, usable rate sheet is having one in any form. When the EFC performs rates surveys, sometimes a utility will quickly write the rates on a piece of paper and fax it over, or send a screenshot of their billing software. While the finance officers and billing clerks know their utility’s rates and are able to bill their customers properly, it is also important to have rates information readily available to those not within the office of the utility. Ultimately, a rate sheet is a communications tool that allows people outside of the utility’s offices to know how they are billed, and a rate sheet is the first step in engaging curious customers.

Utility rate sheet example 1

Example 1. Utility rate sheet showing both electric rates and water rates.

2. Make it Clear

Once you have started to construct a rate sheet, the next question you should ask yourself is: can someone who knows little to nothing about water rates understand this? This doesn’t mean a utility has to not share key rates information in order to avoid confusing someone. Rather, making the monthly (or bimonthly, quarterly, et cetera) base charges stand out, elucidating the consumption allowance including within the base charge, and outlining volumetric rate structures clearly allows the reader to see how much they will pay every bill and for every unit of water pumped in and wastewater pumped out.

Utility rate sheet example 2

Example 2. An example utility rate sheet that clearly differentiates between various rates and fees, including water and wastewater rates  (by meter size) for both inside and outside town limits, tap fees, and garbage collection fees.

3. Keep it short

This is easier for some utilities than others. If EFC Water has only two customer classes and a simple rate structure, they can make a simple rate sheet with ease. For many other utilities, with more complex rate structures or abundant customer classes, making it concise is more of a challenge (albeit a doable one). For utilities with only one customer class, it may seem like a good idea to list the total bill for every thousand gallons used, however this can get out of hand quickly and does not necessarily show customers where rates change if the utility uses a block rate structure. Having some calculated bills is great (e.g. for the average customer or for every 1,000 gallons up to 10,000), as long as you are mindful about how much space this information takes up.

Utility Rate Sheet Example 3

Example 3. A relatively simple utility rate sheet.

4. Make it Accessible

Some customers may not care what their rates are, while others may think their rates are too high no matter what. For everyone else, having a readily accessible and coherent rate sheet helps the utility keep customers knowledgeable and maintain positive relations. Utilities that have websites would do well to post their rate sheets online, and update the posted rates if they change. For many utilities in municipalities without a website, or for non-municipal utilities without an internet presence, this is a moot point. If there is a website however, online postings are one of the most effective ways to spread this information to anyone who is curious.

Are you proud of your utility’s rate sheet? Tell us why in the comments!

2 Comments

  1. Karin Anderson

    March 9, 2016 at 11:15 am

    Thought that the differentiation noted on Penalty Fees was interesting: a Late Fee along with a separate line item of a Delinquency Fee, (however the schedule fails to explain how one determines a ‘late vs. delinquent fee’). Do you know how this utility draws the line?
    As our water utility recently installed meters with antennas to download monthly reads into a handheld Itron devise, I am also interested in ‘Tampering Fees’…….and how a utility would determine if the homeowner/water user actually tampered with their meter. Our meters set a mere 18″ below ground, our freeze depth, and the most tampering that occurs is when someone actually drives over the meter box, crushing the box…..etc. We simply charge the cost of replacement of box, and lid, and riser, dependent upon the damage incurred.

    • Hi Karen,

      Some utilities call the fee charged to a customer that is cut-off, or about to be cut-off, for non-payment a “delinquency fee”. In fact, there are many names that utilities use to call this non-payment cut-off-related fee (see Gary Sanders’ blog post here: https://garysanders.wordpress.com/2016/03/08/cut-off-fee-terminology/). It could be that this particular utility has a late fee for paying a bill after the due date, and a “delinquency fee” for customers that fail to pay beyond a certain date that starts the process of cutting off the customer.

      As for tampering, I am not aware of all of the different practices regarding how utilities determine what is tampering and what isn’t, and how to charge accordingly. If you are a member of the ncwater listserv, I suggest you submit a question to the listserv so that utility managers can respond to your question directly. http://www.efc.sog.unc.edu/content/nc-water-listserv-ncwater

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