Category: Financial Benchmarking (page 1 of 5)

Financial Resilience: Tools to test a utility’s ability to “weather the storm”

These are unprecedented times. As the COVID-19 pandemic continues, social norms have changed and unemployment has risen sharply across the nation. As states have pushed residents to stay home, water usage patterns have altered for both commercial and residential customers. In many cases, commercial customers have decreased use while residential customers have increased. Schools have been closed for months, some of which are the largest water customers in a small town or county. Executive orders have been passed, mandating that service cannot be cut-off for non-payment.

In short, revenues have changed. The level of change varies based on the makeup of the utility’s customer base and the specific hardships within the area, but the change exists in every case. These changes in revenues are typically associated with losses, meaning that budget predictions are off and the actual revenue collected will be much lower than planned.

Utilities will need time to recover these losses. But how do we measure a utility’s ability to bounce back? Bring in the buzz word: Resilience.

At the EFC, we see this pandemic as both very different than anything the US has ever experienced, and also very similar to some of the short-term shocks experienced by utilities in past emergencies. For example, a drinking water utility serving a coastal community that has been walloped by a hurricane.  In both cases, utilities that are more financially resilient are more likely to bounce back faster. Continue reading

How are North Carolina Utilities Faring During the Pandemic? Four Key Insights from Survey Results

With the ongoing COVID-19 pandemic, utilities across the nation continue to adapt to rapidly changing conditions through a number of measures, from suspending water shut-offs to implementing cost-saving maneuvers like reducing energy costs.

To better understand some of the financial implications of the pandemic, the Environmental Finance Center surveyed 93 water and wastewater utilities in North Carolina in early May on a range of topics, including payment plans for delinquent customers, how long they can pay all operating and capital expenses, changes in total revenue collected, staffing for utility operations, plans for the next fiscal year’s rates, and the scope, funding, or timing of capital infrastructure projects for the year.

Four key insights from the survey are detailed below. Each finding is coupled with graphs showing the response distribution for the survey question connected to the key finding. Continue reading

What’s the Use? Assessing Trends in North Carolina’s Residential Water Use

After droughts and in light of future concerns over water resources, the topic of conservation has risen in importance. While regional differences in supply concerns exist across the United States and even on a smaller scale, within states, there have been consistent pushes on a federal-level to move towards more efficient use without customer behavior change. Most research suggests that behavior change is “hard,” but by addressing use at the fixture, consumers can continue flushing and showering just as much and use less water.

In addition to this push towards more efficient appliances, the rise in the water and wastewater rates across the US and more specifically, in North Carolina, have put additional incentive on users to conserve, as they are continually sent a strong pricing signal. Weather and household size can also have profound impacts on water use, but the regionality of weather and general trend towards population growth across the country make it harder to assess the impact on total use. Despite all of the factors that impact total demand, federal and state leaders remain interested in how demand is changing over time and what that means for communities strapped for supply and communities struggling to bring in sufficient revenues to cover rising expenses.  Continue reading

Reclaim Review: A Snapshot of the 2019 Survey and Legislation in Arizona

Written by Ashley Bleggi

As far back as 1926, Arizona has been a leader in the ever evolving world of water reuse. With the release of the 2019 Arizona Water and Wastewater Rates Dashboard, we want to take a look at the recent insights our surveys have uncovered, as well as the current state of reclaimed water legislation in Arizona. 

Overall, about 15% of all the utilities we surveyed for 2019 provide reclaimed water. As discussed in the EFC’s 2017 Arizona Water & Wastewater Rates Report , reclaimed water is significantly cheaper to produce and sell in part due to low energy requirements. Investing in reclaimed water processes allows utilities to avoid the costs of transporting wastewater long distances to surface discharge points, or investing in costly groundwater recharge infrastructure. This trend of reclaimed rates low comparative cost continues into 2019 with the data below showing reclaimed water bills to be nearly four times cheaper than both water and irrigation charges at the same 7.5 kgal consumption level. Continue reading

What the 2019 North Carolina Rates Survey Data Can do for You

Recently, the North Carolina Water and Wastewater Rates Dashboard was updated with 2019 data and the North Carolina Water and Wastewater Rates Report 2019 was published. Are you getting all you can out of these useful resources?

As the start of the new fiscal year approaches in July, utilities across North Carolina will be preparing to enact new water and wastewater rates in their communities. Rate increases can be perceived as negative to the general public, though they are necessary for financial sustainability, and ultimately to protect the public health of the communities they serve. How can utilities convey the important decisions that go into what many just see as an increase in their bill?

That’s where the resources from our 2019 North Carolina Water and Wastewater Rates Survey can help, providing easy to understand visuals, key takeaways from aggregated, statewide data, and the numbers behind it all. Continue reading

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