AWWA JAW61323

Meaningful, scientific measures of water rateequity are elusive. Without a sound metric for equity,discussions of fairness in water rates are prone topolitical manipulation, or worse yet, neglect. Thisstudy crafts empirically grounded, theoretically consistentmetrics of water rate equity at the individualcustomer level, based on AWWA's cost-of-serviceprinciples. Individual equity measures are aggregatedto a utility-level rate equity index for analysis ofentire rate structures. A third metric captures rateprogressivity, or the degree to which rate structuresfavor high- or low-cost-of-service customers. Equitymetrics are calculated using financial and billing datafrom a small municipal water utility. Finally, thisarticle analyzes several alternative rate structures forthe example utility and draws inferences about theirrespective degrees of equitability. The equity metricsdeveloped here provide new tools for managers andpolicymakers in assessing the equity of alternative ratestructures. Includes 19 references, tables, figures.

Product Details

Edition:

Vol. 97 - No. 4

Published:

04/01/2005

Number of Pages:

14

File Size:

1 file , 250 KB