What’s all this buzz about a conservation rate structure and city water? The idea is, the more water you use, the more you pay. A state law tries to make conserving water pay -- and using water cost you more.[i] The law currently requires public water suppliers in the metro area, serving more than 1,000 people, to include a “conservation rate structure” in city ordinances dealing with water rates.
So how does a conservation rate structure work? It’s up to the city water system. Conservation is the key but cities can use a variety of approaches to achieve it.
So what goes into water rates to begin with? To make this a little more fun, think of buying a Twins baseball ticket. Some of your money goes for maintenance and operation of the stadium, a bit of the price of each ticket goes to a sales tax to pay for the stadium itself – and then you pay extra for the best seat in the house.
In the same way, city water rates use volume charges to cover operation and maintenance of the system and a base rate to cover infrastructure costs. After that, a city may use block rates (like that Twins ticket in that primo section behind home plate) where higher water usage puts you into a higher cost bracket for all the water you use. Just as Twins tickets may run a little higher because fans are paying for that new stadium, city water rates vary if a new water plant is being planned or built or paid off.
What are some ways to set a conservation rate? Cities may use a seasonal rate to encourage conservation in the summer when usage skyrockets due to lawn watering. Seasonal rates might include a surcharge or an added fee to discourage constant watering. And, those fees or surcharges might disappear in the winter.
Cities must also consider the number of residential units in an apartment building. Water usage to an apartment building is divided by the number of residential units. If the average amount of water used by each apartment is higher than a residential home, those users, or that building, will pay more too.
Why was this law passed, how is it enforced and when does it take effect? The law seeks to eliminate the practice of charging less the more water you use, which of course, encourages consumption not conservation. Currently, a metro city water system serving more than 1,000 people must have a conservation rate structure in place before it requests approval from the state Department of Health to construct a new public water supply well or requests an increase in the authorized volume of water appropriation. The need to have a conservation rate structure kicks in for all remaining city water systems (including greater Minnesota) serving more than 1,000 people on Jan. 1, 2013.