The Economic Value of Efficiency for California Water Service: Lower Water Bills

Prior to 2009, California Water Service Company (Cal Water) did not meter all its water customers, did not have conservation rates, and did not offer a robust set of conservation programs. Per capita water use had been flat or increasing prior to this period. In 2009, Cal Water adopted conservation rate designs (increasing block rates, IBRs), increased conservation program expenditures by more than
three-fold and implemented an accelerated schedule to convert unmetered customers to metered water service. Per capita water demand has decreased steadily since 2009. These innovative strategies related to water efficiency, conservation, and rates over the years pose the questions: What would the economic impact on bills have been if none of these activities occurred? Are bill-paying customers better or worse off?