Policy Principles
Incentivize Customers to Conserve by Expanding Rate Tiers: The More You Use, The More You Pay
- Water rates in California should discourage excess consumption by increasing the cost of water based on various tiers of usage.
- While a common practice in energy conservation, tiered water rates are not a standard practice among all water providers.
- Tiered rate structures, similar to those used for energy, can establish baselines that reflect climate and size of households to recognize the needs of large families and hotter climates, but discourage excessive usage by increasing the price as usage increases.
- Tiered rates enable customers to make wiser water decisions about time of use and amount for daily activities. This gives customers more control over their water usage and ultimate water bill.
- Cal Water has used tiered water rates for more than a decade and customers have used less water and saved money on their bills.
ACTION:
Cal Water recommends the state adopt an industry-wide approach to tiered rates for all water providers to motivate customers to better understand their water usage and reduce water use.