Eight reasons the cost of water is rising

Why is the cost of water rising? It’s going up due to eight key reasons.


  1. Significant backlog of capital projects. Nationally, the rate of investment in public water systems lags behind need. The U.S. EPA calculates that $344.7 billion must be invested before 2026 to attend to needed in-kind system replacement, including the costs associated with the Safe Drinking Water Act rules established through 2006. The National Association of Clean Water Agencies and the Association of Metropolitan Water Agencies collaborated to assess the costs to public water supplies of climate change. Their 2009 analysis, published in Confronting Climate Change: An Early Analysis of Water and Wastewater Adaptation Costs, estimates that $448 billion to $944 billion is needed through 2050 for infrastructure and operations and maintenance to respond to climate change impacts (exclusive of emergency response/removal resulting from extreme storm events and drought).

  2. Shift from federal to local funding for capital projects. In the past two decades the federal government has withdrawn from its long-established role as key capital investor in public water supplies, leaving states and local utilities to grapple with instituting new ways to attend to current and future investment needs.

  3. Utilities' adoption of full-cost accounting practices. Water/sewer utilities are improving their financial practices through full-cost accounting. Approximately 75% of the cost of supplying and maintaining water systems is supported by property taxes rather than utility bills. To avoid tax increases, governments are shifting the costs of supplying and maintaining water systems to utility bills. While an important vehicle for long-term stability, this shift is the reason for many short-term steep rate increases.

  4. Population shift to higher demand climate zones. The U.S. population is growing and is concentrating in areas where long-term access to drinking water supply is a significant and costly challenge. The nation's 10 fastest growing cities (metropolitan areas, included) are all in Sun Belt states: Raleigh, N.C.; Austin, Texas; Las Vegas, Nev.; Orlando, Fla.; Charlotte, N.C.; Riverside-San Bernardino, Calif.; Phoenix; Houston; San Antonio, Texas; and Dallas-Fort Worth.

  5. Limited access to clean water. Sixty-eight percent of the U.S. public consumes water sources from rivers, streams, lakes, ponds, and reservoirs. In 2009, the EPA reported on surveys of these sources, showing that 64% of the nation's lakes, ponds, and reservoirs are so polluted so as to be characterized as impaired, not clean enough to support their designated uses. Also, 44% of the nation's rivers and streams share the same status.

  6. Changes to North American water cycles. As precipitation shifts from snow to rain, so too rain water volume is increasingly concentrated in the most intensive storms. These changes correspond to an increase in flooding and a reduction in snowmelt supply to water sources, and frustrate demand for water to support human health, food, and energy needs.

  7. Simple supply and demand. In some locations, consumers' conservation patterns are reducing net volume of water use, which prompts the need for an increase in rates to provide for system capital and operating needs.

  8. Regulation. Regulation of water quality has expanded, and is expected to continue to do so.

Willa Kuh is Affiliated Engineers’ director of planning. She has expertise in campus projects with an emphasis on resource planning, assisting clients in their development of facility master plans, strategic energy plans, sustainability plans, and climate mitigation plans. Kuh is a planner for the UW Health at the American Center project. Fred Betz is a senior sustainable systems analyst with Affiliated Engineers. With a doctorate in building performance and diagnostics from Carnegie Mellon University, he specializes in advanced building systems integration, energy and other resource simulation and planning, renewable energy and power generation, and controls and diagnostics. He is the lead energy and water analyst for the UW Health at the American Center project. 

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