Tag: Texas (Page 1 of 2)

Imagine a Day Without Water

Today, October 23, 2019, organizations across the county are urging people to “Imagine a Day without Water.” The event, coordinated by the US Water Alliance, is intended to remind us all about the value of water, and to push us to think for just a moment of where we would be without it.

When I recently attended the OneWater Summit in Austin, TX, also put on by the US Water Alliance, many stories were shared about the struggle communities and individuals are facing in Texas when water is scarce or contaminated or inaccessible. Whether the costs arise from hauling in bottled water for years to a community with a dried up well, or from the economic effects of a 6 day boil water notice in a city with a population of almost a million people, the immense value of clean, reliable and sustainable water sources is real for Texans. Continue reading

Designing Water Rate Structures for Conservation and Revenue Stability

Texas Webinar

Water conservation is critical to meeting the future water needs of Texas.  Many programs may be implemented to reduce water use, and a number of utilities across the State are making strong efforts to advance water conservation. One of the most effective methods to driving conservation is water pricing.  Used effectively, price can provide a signal to users regarding the value and supply of water so they can adjust their demand accordingly. Unfortunately, rates are also the primary revenue mechanism for utilities that are also tasked with protecting public health and the environment. This can create a disincentive to increase conservation.  Fixing this conflict requires rethinking the current business model.

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$napshot: Utility Rate Increases versus Revenue Increases

A $napshot is a graphic revealing an interesting environmental finance finding accompanied by a short post. This $napshot was created by Shadi Eskaf.

Changes to Rates and Revenues among 566 Utilities

Changes to Rates and Revenues among 566 Utilities

While revenues usually rise as water and wastewater rates increase, revenues generally rise slower than rates. The graphs show how 566 utilities in three states changed rates over a three or four year period, and the subsequent change to annual revenues in the same time period. Four observations can be made. Continue reading

Water Rate Increases Among 1,961 Utilities in Six States in the Last Decade

Shadi Eskaf is a Senior Project Director for the Environmental Finance Center at the University of North Carolina, Chapel Hill.

Rising rates image

Our research shows that water rates have been rising faster than CPI inflation in the past few years for hundreds of utilities, particularly after the financial crisis. In some states, however, there were also many utilities whose rates failed to keep pace with inflation.

From a rate-setting perspective, utilities that raised rates more frequently had a double advantage over utilities that raised rates only occasionally or rarely. First: the average annual rate increase was lower than the one-time rate increases of utilities that occasionally raised rates, reducing the rate shock that customers experienced when rates rose. Second: despite the lower average rate increases, utilities that raised rates more frequently accumulated, on average, a larger total increase in rates in a five-year period than utilities that raised rates only occasionally.

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Trends in Operating Expenses Relative to Operating Revenues for Local Government-Owned Water Utilities

Shadi Eskaf is a Senior Project Director for the Environmental Finance Center at the University of North Carolina, Chapel Hill.

Ratio of Operating Revenues to Operating Expenses for 62 Utilities Nationwide

Ratio of Operating Revenues to Operating Expenses for 62 Utilities Nationwide

A couple of months ago, we blogged that water utilities’ operating revenues are generally continuing to grow every year, but that there was a slowdown of revenue increases in recent years, particularly after 2008. At the same time, expenses are also rising. Does this mean that expenses have caught up to revenues and that the majority of utilities are now experiencing revenue shortfalls?

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