GLIN==> The Value of Great Lakes Water Initiative Brings New Information on Trends and Attitudes Towards Water Pricing in the Great Lakes Region

The Value of Great Lakes Water Initiative Brings New Information on Trends
and Attitudes Towards Water Pricing  

 

The Great Lakes Commission's Value of Great Lakes Water Initiative aims to
improve understanding of how public water is priced in the Great Lakes
region and explore ways that water rates can be used to advance efficiency
and conservation goals. Launched in January, 2010 the Great Lakes Commission
partnered with Michigan State University's Institute for Public Utilities
(IPU-MSU), the Alliance for Water Efficiency, the Alliance for the Great
Lakes, and other stakeholders to gather current and comprehensive to help
inform the understanding of water pricing in the Great Lakes region.  

 

As part of the Value of Water Initiative, IPU-MSU conducted a detailed
survey of the rates charged by the largest ten systems in each of the eight
states in the region. Using data mining techniques, including direct review
of tariffs in place as of mid-2010, the survey provides more comparative
detail than has been previously available. The findings confirmed that rates
and rate practices in the region vary in important ways, including
conservation orientation. The survey also suggests that the key structural
features of water systems, such as water source, ownership, and regulation,
play a role in pricing. A supplemental analysis focusing on Wisconsin
systems, reveals pressure on the operating expenses for systems that rely on
groundwater. "This suggests that the additional costs associated with
pumping water from deeper groundwater resources may be contributing to cost
increases in areas heavily dependent on groundwater" said Ed Glatfelter,
former Director of Conservation Program at the Alliance for Great Lakes and
Value of Water Initiative partner.  "Water is a rising-cost industry", said
Dr. Janice Beecher, Director of the MSU Institute for Public Utilities who
directed the survey.  "Infrastructure costs are combining with declining
demand to put pressure on prices," noted Beecher, "so the benefits of
conservation must be understood not in terms of lower water bills but bills
that are lower than they would be without the benefit of efficiency gains.
This will be a communication and education challenge."

 

As part of the Great Lakes Value of Water Initiative, the Alliance for Water
Efficiency (AWE) recently completed four workshops on water utility
conservation rates. Designed for utility officials, the workshops aimed to
educate water utilities about different rate structures and options for
conservation as we learn more from utilities about how and why they develop
their current rates the way that they do.  Held in Ann Arbor, Mi, Racine,
Wi, Buffalo, NY and Chicago, IL, the workshop participants confirmed what
the survey also revealed:  there is still very little use of water
conservation pricing in the Great Lakes region. Water utilities in the Great
Lakes region struggle to balance the desire to protect the public against
price increases and the need to ensure adequate revenues. Rate structures
that aim to incentivize conservation complicate this struggle. Workshop
participants welcomed the information they received about alternative
pricing mechanisms.  Still, there are many technical and socio-economic
barriers to moving from learning about different rate structures to
implementing them.  "There is an enormous need to educate and inform water
utilities about the benefits and tradeoffs of different water pricing
structures," said Mary Ann Dickinson, President of the Alliance of Water
Efficiency who led the workshops.  Moreover, the desire to stabilize
revenues makes utilities more cautious about trying new
approaches-especially if the one they are using seems to be working. 

 

That is where another element of the Value of Great Lakes Water Initiative
may help tip the scales toward water pricing that better reflects
conservation goals.  The Initiative has undertaken an ecological assessment
of all Great Lakes sub-watersheds and identified those that are at current
and/or future ecological risk from water withdrawals. The next step in the
Initiative is to explore the feasibility of using alternative water pricing
to head off current and future water supply problems in those areas most at
risk.  "It will be important to reach out to communities and utilities in
these watersheds to make them more aware of the potential risk to their
water supply, and to share this information with them so they can make sure
their water pricing reflects these ecological realities, "noted Dickinson. 

 

A final report and results of the feasibility analysis will be published by
the Great Lakes Commission in the spring of 2011. For more information on
the Value of Great Lakes Water Initiative, go to
http://glc.org/wateruse/watervalue/.

 

 

 

 

Victoria Pebbles

Program Director

Great Lakes Commission

2805 S. Industrial Hwy., Suite 100

Ann Arbor, MI  48104-6791

ph:  734-971-9135

fax: 734-971-9150

email:   <mailto:vpebbles at glc.org> vpebbles at glc.org

 

 

-------------- next part --------------
An HTML attachment was scrubbed...
URL: http://www.great-lakes.net/lists/glin-announce/attachments/20110205/09475de1/attachment.html