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Is your water too cheap?

By Sean Olson
Of the Journal
      There's a prevalent notion that only two things make a real difference when convincing people they should save water: sticker shock and shame.
    And while shame is used in droughty New Mexico — ever wonder why there is a comparison between your use and the average residential water use in every water bill? — there is a growing argument that sticker shock from a high water bill just isn't shocking enough.
    The logic goes that people notice slight increases in their water bills, but it isn't enough of a bother to change their watering habits. But when a bill three times the size of their last one shows up, they burn the hose and post a guard at the bathroom door.
    "If the price is high enough, people will pay attention," water economist David Zetland said in a recent interview.
    Zetland, a Wantrup Fellow at the University of California, Berkeley, and author of the always interesting Aguanomics blog, is one of the advocates for a block pricing schedule that rewards the water thrifty and puts the unmerciful hammer down on big residential water users.
    The first block of water, which would be about 75 gallons a day, would be close to free. But jump above that amount, which is enough to handle showers, toilets and other indoor uses by most accounts, and the price shoots up 300 percent or 400 percent. In theory, the biggest water users would end up subsidizing everyone else's cheap water.
    Under that plan, the cost of maintaining a nice lawn, a fountain or a — gasp — pool would skyrocket. But a few facts about our own water costs put it in better perspective.
    Even in our desert community, water is dirt cheap. The Albuquerque Bernalillo County Water Utility Authority charges by units, with one unit being equal to 748 gallons. For 748 gallons of water — or roughly 4,800 20-ounce bottles of Evian — the people of Albuquerque pay $1.41.
    The water authority doesn't charge a higher rate for high water use until someone goes above three times their winter average — or they use more than 62,832 gallons in a single month. Winter averages are based on bills from December through March. The water rate doubles when it hits either mark.
    Wastewater charges are based on winter averages as well, so high users in those months get a higher charge all year.
    Still, it doesn't have the same blood-pressure-raising, eye-bulging, foul-language-causing effect as the dramatic monthly highs and lows of Zetland's offering. More important to proponents of steep block pricing, it doesn't have the same motivating effect.
    The other consideration under the current water rate system in Albuquerque is that conservation has to be funded. If residents start a massive conservation effort and dramatically lower water use in the city, the water authority's operating revenues tumble, too. For some water utilities, this has meant conservation brought a pat on the back accompanied with a rate increase for everyone.
    In fairness, the water authority has overseen conservation in recent years without having to increase rates and has a business plan that doesn't include rate increases until 2012, even with lofty conservation goals.
    None of this matters, of course, if the theory doesn't work in practice.
    So let's look at Tucson, which has a similar water system to Albuquerque's. Tucson uses a form of the steep block pricing advocated by Zetland and others, albeit more lenient, with each residential customer's water costing $1.23 per unit for the first 11,000 gallons a month. After that it jumps to $4.52 per unit and grows from there.
    Mitch Basefsky, a Tucson Water Department spokesman, said the formula has its pros and cons. He said there is a much higher risk involved for a utility using the pricing scheme, as utilities are forced to guess how well the city will conserve each year to balance a budget.
    In conservation terms, he said the rate system works. He said that since the system was adopted 15 years ago, water use has dropped by about a third and 75 percent of the customers never use more than the first 11,000 gallons a month.
    With a big water conservation goal to meet in Albuquerque — it has two decades to make big cuts in water use per state engineer's orders — residents need some sort of serious kick in the pants.
    Maybe Zetland's plan is it, maybe it isn't. But either way, your water rates — and your conscience — are going to be a big part of the discussion.
    UpFront is a daily front-page
    opinion column. Sean Olson
    can be reached at 823-3563
    or at solson@abqjournal.com.

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