Conservation Efforts Save Customers Money

Water conservation efforts have reduced Cal Water customers’ bills by as much as 20.5 percent over the last 15 years compared to what they would have been without those efforts, according to a new study released by the Alliance for Water Efficiency (AWE). Cal Water’s water efficiency and conservation measures during that time decreased operating costs, which in turn saved customers money.

Water conservation has been shown to be the lowest-cost source of supply, because when less water is used, some costly investments required to produce additional water supplies can be deferred and potentially avoided. This study, “The Economic Value of Efficiency for California Water Service: Lower Water Bills (PDF),” details the impact of Cal Water’s water conservation efforts on affordability.

It can be difficult to understand rate increases when system-wide water use has gone down, often leading customers to blame water conservation and efficiency for higher rates, according to AWE. The study shows, however, that rate changes would have been larger without water conservation and efficiency measures. Additionally, these conservation measures enabled the utility to realize environmental benefits, such as lower chemical use from less treatment required along with reduced energy consumption and subsequent greenhouse gas emissions.

“Our water conservation efforts have reduced our costs from what they would have been absent conservation throughout all our districts, giving us the ability to request smaller rate adjustments for our customers when costs rise and infrastructure investments need to be made,” said Martin A. Kropelnicki, Cal Water Chairman and CEO. “Particularly as California begins implementing permanent long-term water-use reductions, it is critical that we leverage conservation practices that reduce costs and water usage.”

Cal Water substantially increased its water conservation efforts beginning in 2009, including the adoption of tiered rate structures that send an intentional price signal to customers about the cost consequences of using more water. Implementing tiered water rates, universal metering, efficient plumbing standards, and long-term conservation programs have all helped lower Cal Water’s operating costs in the short and long term, AWE found.

Without the reduction in water demand since 2008-2009, AWE estimates that bills in Cal Water’s service areas for the 2010-2022 period would have been at least 1.2 to 20.5 percent higher, depending on the district. The money Cal Water spent on conservation programs was more than offset by lower water production costs, deferred capital spending, and other reduced costs.

Furthermore, the study shows that investing in water conservation directly benefits customers by helping to slow the increase in water service costs over time. Investments in water efficiency are not only critical to provide a sustainable water supply, but also to help keep water service affordable.