Water Prices in 2015 Up 6 Percent in 30 Major U.S. Cities

Continuing a trend that reflects the disrepair and shows no sign of slowing, the price of residential water service in 30 major U.S. cities rose faster than the cost of nearly every other household staple last year …

Source: www.circleofblue.org

>” […] The economics of water — particularly the cost of treatment, pumping, and new infrastructure, as well as the retail price for consumers — gained renewed prominence as California and Texas, America’s two most populous states, face historic droughts and water managers seek to rein in water consumption, with price increases as one tool in their arsenal.

The average monthly cost of water for a family of four using 100 gallons per person per day climbed 6 percent, according to data collected from the utilities. It is the smallest year-to-year change in the six-year history of the Circle of Blue survey but comparable to past years. The median increase this year was 4.5 percent. In comparison, the Consumer Price Index rose just 1.8 percent in the 12 months ending in March, not including the volatile food and energy sectors. Including food and energy, prices fell by 0.1 percent.

For families using 150 gallons and 50 gallons per person per day, average water prices rose 6 percent and 5.2 percent, respectively.

The survey results reflect broad trends in the municipal water industry that nearly every U.S. utility must grapple with, according to Andrew Ward, a director of U.S. public finance for Fitch Ratings, a credit agency.

Distribution pipes, which can branch for thousands of miles beneath a single city, have aged beyond their shelf life and crack open daily. Some assessments peg the national cost of repairing and replacing old pipes at more than $US 1 trillion over the next two decades. In addition, new treatment technologies are needed to meet Safe Drinking Water Act and Clean Water Act requirements, and cities must continue to pay down existing debts. At the same time, conservation measures have proven successful. Utilities are selling less water, but they still need big chunks of revenue to cover the substantial cost of building and maintaining a water system. All together, these and other factors amount to a persistent upward pressure on water rates. […]

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4 thoughts on “Water Prices in 2015 Up 6 Percent in 30 Major U.S. Cities

    • Scarcity will drive prices up, however, it seems a lot of existing infrastructure may require urgent repairs and replacement due to age. This gap widens every year. Multiple stresses, including rising demand and pressure fluctuations in systems can aggravate problems resulting in increase frequency of mains rupturing. This has been noted in California recently. So, will increases in prices turn into a higher return by the utility, not necessarily, depends on the region, how the utility is operated, maintenance requirements, expansion, water treatment system upgrades and other factors.

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