In October, WaterFilterData.org published a report that examines water utility prices and found that over the past eight years, the cost of water has risen three times more than that of inflation for a family of four, a 57 percent increase. At this current rate, projections show that by 2022, “nearly one-third of American households will be unable to afford their monthly water bill.”[1]
The report highlights a number of factors contributing to this increase, the first being costs associated with aging infrastructure. Much of the country’s water infrastructure is a product of the WWII era and estimates are upwards of $1 trillion dollars to address all the issues. Additionally, there has been a reduction in federal spending, another contributing factor to the cost increase. According to the report, federal funding for water infrastructure was over 60 percent in the 1970’s but currently is less than 10 percent, placing the heavy financial burden at the state and local levels.
Climate change is also a factor in the cost increase as more funds are necessary to deal with changing climate stressors (i.e., increased rainfall and flooding). Furthermore, as the public has become better educated about climate change, its behaviors have become more conservation-minded and a corresponding reduction in revenue for water utilities has been the result.
The final factor referenced in the report is increased population demands. As populations continue to grow, water resources become more stressed—demand will outpace supply. According to a 2014 report of the Government Accountability Office, “40 states stated they expect to face water shortages unrelated to drought over the next 10 years.”[2]
The vast number of people who will face the issue of water affordability if current trends continue make it clear that the issue of rising costs must be addressed. A Brookings report found that “88 percent of Americans believe some type of action is needed to solve the country’s water infrastructure challenges, [but] only about 17 percent of utilities are confident that they can just cover the cost of existing service through rates and fees.[3] If left unaddressed, prices will continue to climb, and for 40 million homes across the country, the cost will be greater than 4.5% of household income, a figure the EPA says water utilities should not surpass to be “affordable.”
[1] “Water Utility Prices Are Rising At Over 3x The Rate Of Inflation, Soon 1/3 Of Households Won’t Be Able To Pay Their Bill.” Water Filter Data, 31 Oct. 2018, www.waterfilterdata.org/water-utility-inflation/.
[2] “Water Utility Prices Are Rising At Over 3x The Rate Of Inflation, Soon 1/3 Of Households Won’t Be Able To Pay Their Bill.” Water Filter Data, 31 Oct. 2018, www.waterfilterdata.org/water-utility-inflation/.
[3] Burke, Alison. “10 Facts about Water Policy and Infrastructure in the US.” Brookings.edu, The Brookings Institution, 21 Mar. 2017, www.brookings.edu/blog/brookings-now/2017/03/21/10-facts-about-water-policy-and-infrastructure-in-the-us/.