Water Utilities In California Looking To Offset Their Conservation Costs

Advertisement

A survey has been done recently related to the water utilities and it was found out that there is an expectation of the water rates in California to increase.

Utilities are looking for the ways to offset those costs which they have to incur for the conservation of water the phase of drought. In the report of the survey, according to seventy eight percent of the utilities, this adjustment for the rates is already being done or will begin in the next year. While there were fifty seven percent of the utilities which said that a structure for self-correction of the rates is already in place.

Senior Director of Fitch, Kathryn Masterson demonstrated the reason for the increase in the rate that because of this prolonged drought, the tools which were utilized by the utilities for the management of the hydrological cycle of the state has been outstripped. There have been the considerations over that and inspection of the rates of water have also been done legally but these utilities have the best and the most feasible tool available for them in the shape of increase of these rates to cover the large conservation and less amount of revenue.

There have been a great political debate over the issue and the year is politically very active for the utilities as it is not an easy thing to increase the water rates in the state of California.

Advertisement

According to the laws of the state, it is necessary for the utilities to give a notification in writing to all the property holders regarding the change in the rates and they are also required to hold a public hearing as they are going to listen to their complaints and give them reasonable answers. It is also compulsory for these utilities to limit the changes to the real cost of service. Various water utilities in California are busy in the cost-of-service studies, preparing the actions for the rates probably from mid to late fiscal 2016.

More findings of the survey told that apart from this strategy of increasing the water rates, fifty two percent of utilities told that their less revenues are going to be adjusted by reduction in the operating expenses. According to forty six percent of them, their financial reserves would be used while thirty seven percent told that there is the possibility of deviation from the capital spending that had been planned.

The whole water industry has to face a major challenge in the form of water rates and its value. It has been listed as one of the most important issues of the year to make the understanding of people regarding the value of water systems and its resources better.

Leave a Reply

Your email address will not be published. Required fields are marked *