California Public Utilities...
30
California Public Utilities Commission Report to Legislature Progress and Achievements Towards Water Conservation Goals Public Utilities Code § 2714.5 June 2008
Transcript of California Public Utilities...
California Public Utilities CommissionReport to Legislature
Progress and Achievements Towards Water Conservation Goals
Public Utilities Code § 2714.5
June 2008
Table of Contents
I. Executive Summary.................................................................................................. 2
II. Conservation Rate Design and Financial Incentive to Conserve...................... 3
A. Overview ................................................................................................................. 3
B. Water Conservation Rate Designs Authorized – Class A Water Utilities .............. 3 1. Block and Tier Rate Design..........................................................................................................4 2. Financial Mechanisms Decouple Sales from Revenues ...............................................................5
C. Interim Water Conservation Targets Adopted - 3%-6% Reductions...................... 6
III. Water Conservation Program Costs ................................................................... 6
D. Introduction............................................................................................................. 6
E. Energy Utility Proceedings..................................................................................... 7
F. Water Utility Proceedings....................................................................................... 8
G. Coordination with Other State Agencies ................................................................ 8
IV. Summary & Conclusions.................................................................................... 10
1
I. Executive Summary
Public Utilities Code (Pub. Code) Section 2714.5 requires that the California Public
Utilities Commission (Commission) report to the Legislature, by June 30, 2008, on progress
toward the development and implementation of select water conservation policy objectives
contained in the Water Action Plan, adopted in December 2005. Section 2714.5 requires a report
on the:
1. The progress achieved towards the development and implementation of
ratemaking mechanism and rate design that encourages conservation and efficient
water use;
2. The progress achieved toward development and implementation of rates that
remove the financial disincentive for water corporations to conserve water that
exists in the current rate structure, while preserving continued revenue stability
for water corporations as new rate structures are implemented; and
3. The impacts of water conservation and efficiency programs on future water,
energy, and wastewater treatment costs to customers of water corporations.
The Commission has made progress towards instituting pricing structures (rate designs)
to encourage water conservation. In addition, the Commission has adopted financial
mechanisms to decouple water sales from revenues in order to remove the financial disincentives
for water utilities to implement water conservation rates. This helps to preserve revenue
neutrality for the water utilities.1 A more detailed discussion of the recently adopted water
conservation rates and the financial mechanisms is provided in Section II of this report.
The effect of water conservation programs on water, energy, and wastewater costs to
ratepayers is currently being addressed in two Commission proceedings:
1. Order Instituting Investigation (I.) 07-01-022 (Water Conservation OII), and
2. Order Instituting Rulemaking (R.) 06-04-010.
Commission Decision (D.) 08-02-036 in I.07-01-022 authorized modified cost balancing
accounts (MCBA), in which the utility records the increase or decrease of purchased water,
purchased power, and pump tax, since the utility’s last general rate case. The MCBA makes the
1 Commission D.08-02-036 authorized conservation rates and revenue adjustment mechanisms for California Water Service, Park Water, and Suburban Water (rate design only). A decision is expected shortly for Golden State Water and San Jose Water. See http://docs.cpuc.ca.gov/PUBLISHED/FINAL_DECISION/79434.htm
2
utility whole if costs go up and allows for any reduction in these costs to be passed on to the
ratepayers. In R.06-04-0102 and associated applications,3 pilot programs currently in progress
between Commission regulated energy utilities and municipal water providers, will provide
measures of water-related energy savings not currently undertaken by either water or energy
utilities, as well as the associated costs of these endeavors. The Commission is also working
closely with other state agencies to achieve these vital conservation goals.
II. Conservation Rate Design and Financial Incentive to Conserve
A. Overview On January 11, 2007, the Commission opened I.07-01-022 to consider rate designs,
recovery mechanisms, and policies to achieve the Commission’s conservation objectives for
Class A water utilities.4 Class A utilities deliver 95% of the water distributed by utilities
regulated by the Commission. The Water Conservation OII was specifically opened to study and
address policy issues related to the implementation of increasing block rate designs, Water
Revenue Adjustment Mechanisms (WRAM), rebates and customer education, conservation cost
memorandum accounts, and water rationing programs. The Water Conservation OII is divided
into two phases - Phase I is focused on addressing water conservation rates and cost recovery
mechanisms for residential customers,5 and Phase II will address non-rate related conservation
measures.
B. Water Conservation Rate Designs Authorized – Class A Water Utilities In February 2008, the Commission adopted water conservation rate design programs
for California Water Service Company (Cal Water), Park Water Company (Park), and Suburban
Water Systems (Suburban), and is currently reviewing similar programs for San Jose Water
Company (San Jose) and Golden State Water Company (Golden State).6 As part of a separate
proceeding, in June 2008, the Commission adopted a water conservation rate design program for
2 Per Assigned Commissioners Ruling and Scoping Memo dated May 24, 2006. http://docs.cpuc.ca.gov/published/proceedings/R0604010.htm 3 A. 07-01-024, -026, -029, and -030. For example, http://docs.cpuc.ca.gov/published/proceedings/A0701024.htm 4 Class A water utilities are utilities that serve 10,000 customers or more. 5 Increasing block rates for non-residential customers will be addressed in the investor-owned class A water utilities’ next General Rate Cases. Non-residential conservation rates were adopted for California Water Service Company. 6 D.08-02-036 in I.07-01-022.
3
California American’s Los Angeles District (Cal Am LA).7
This summer, Cal Water anticipates rolling-out the adopted water conservation rates for
most of its 460,000 residential and non-residential customers throughout its service territory8.
Suburban anticipates implementing its residential water conservation rates late this summer in
the service areas of San Jose Hills and Whittier/La Mirada, serving approximately 75,000
customers. Park, which serves approximately 27,000 customers, anticipates implementing its
water conservation rates this Fall in its Central Basin Division area which includes portions of
Norwalk, Bellflower, Compton, Lynwood, Artesia, Santa Fe Springs, and some unincorporated
Los Angeles County areas. A Commission decision on the conservation rate design settlement
agreements for San Jose and Golden State water companies is expected by Fall of 2008.
Approximately 27, 200 customers are served in Cal Am’s LA district, which includes the San
Marino, Duarte, and Baldwin Hills service areas.
The adopted water conservation rate design programs will be re-evaluated in the next
General Rate Case (GRC) for each water utility. The Commission also plans to address the
following water conservation related issues in each of the above referenced water utilities’ next
GRC:
1. Expanding the conservation rate designs to non-residential customer classes;
2. Providing financial incentives for utilities that meet the conservation targets;
3. Developing plans to transition from flat to metered rates;
4. Increasing the break points between tiers; and
5. Setting the first tier break point closer to average winter consumption.
1. Block and Tier Rate Design The conservation rates adopted in D.08-02-036 were negotiated in multi-party settlement
agreements. Parties involved in the OII and settlement agreements included many of the Class
A water utilities, the Division of Ratepayer Advocates (DRA), The Utility Reform Network
(TURN), Latino Issues Forum (LIF), Disability Rights Advocates, Consumer Federation of
California(CFC), National Consumer Law Center (NCLC) and other interested parties.
7 D.08-06-002 in A.06-01-005. 8 Conservation rates will not be implemented in Kern River Valley, Redwood Valley, and the Fremont Valley sub-district in Antelope Valley. Districts in which conservation rates will be implemented include Antelope Valley (partial), Bakersfield, Bayshore, Bear Gulch, Chico, Dixon, East Los Angeles, Livermore, Los Altos, Marysville, Oroville, Ranch Dominguez, Salinas, Stockton, Visalia, Westlake, and Willows.
4
The Commission approved increasing block or tier rate structures that are intended to
provide economic incentives for customers to conserve. In the adopted block or tier rate
structure, the cost per unit of water increases to a second or third tier price that is set at specific
level(s) of water usage.9 The second and third tiers equate to higher consumption of water. The
basic economic principle is to provide customers with an economic incentive to reduce their
water consumption by charging them a lower rate in the first tier, and an increased rate (e.g. 10%
to 15% higher) at the upper tiers. The Commission did not prescribe the specific tier levels or
price differentials; instead it allowed the parties to negotiate the tier levels and rate differentials.
Given the revenue neutrality of the negotiated rates, the adopted rates in general provide a
reduced rate for water (per unit cost) in the first tier and/or reduced fixed charge and an increased
price in the upper tiers.
The conservation rate design adopted for Cal Am LA district was also reached via a
settlement between the DRA, the City of Duarte, and California American. The Commission
approved an increasing block or tier rate structures, in which the cost per unit of water increases
to a second and third tier price that is set at specific level(s) of water usage.10 The second and
third tiers equate to higher consumption of water. As with the tiered rate design of the other
Class A water utilities discussed above, this tiered rate design, as well as a seasonal adder during
the summer months, provides customers with an economic incentive to reduce their water
consumption by charging them a lower rate in the first tier, and an increased rate (e.g. 10% to
25% higher) at the upper tiers
More detailed information about the adopted conservation rates, tier levels,
implementation areas and dates is provided in Attachment A.
2. Financial Mechanisms Decouple Sales from Revenues The Commission adopted financial mechanisms for Cal Water, Park, Suburban, and Cal
Am’s LA district, which include the Water Revenue Adjustment Mechanism (WRAM) and
Modified Cost Balancing Account (MCBA), to decouple water sales from revenues and remove
the financial disincentives for investor-owned water utilities to institute the water conservation
rates. Under the authorized WRAM, utilities are made whole for any revenue shortfalls from
9 The tier levels are set by specific regions and customer consumption patterns in those regions. 10 D.08-06-002, p.9.
5
authorized revenues that result from water conservation by their customers. More specifically,
the WRAM allows for recovery or crediting of differences between actual and adopted quantity
charge revenues. The MCBA financial mechanism provides for recovery or crediting of
differences between actual and variable costs associated with purchased power, purchased water,
and pump tax.
C. Interim Water Conservation Targets Adopted - 3%-6% Reductions The Commission’s Water Action Plan recommended means to achieve the stated
objective of strengthening water conservation programs to a level comparable to those of energy
utilities, and the OII expanded upon this principle. The Commission’s 3%-6% water
conservation interim target was set after reviewing the water conservation goals of a number of
California municipal utilities,11 and comparing their objectives with those of Utah’s and
Southern Nevada’s Water Authorities. The Commission focused on urban water programs that
express a non-drought conservation objective as a percentage reduction in water consumption,
either per capita or overall objective. The Commission found that conservation goals generally
ranged from 12.5% to 25.0% over a varying number of years, and that the range was consistent
with published literature that indicates that a 10%-20% reduction can be achieved over 10 to 20
years from carefully designed conservation programs.12 The Commission plans to examine
water conservation targets in Phase II of the I.07-01-022, as well as application of the
conservation targets to all customer classes.
On February 29, 2008, Governor Schwarzenegger proposed a water conservation plan to
achieve a 20% reduction in per capita water use statewide by 2020. The Commission will
continue to monitor, respond to, and incorporate the Governors proposals into Commission
policies and proceedings, in order to meet these vital water conservation goals.
III. Water Conservation Program Costs
D. Introduction
The effect of water conservation programs on water, energy, and wastewater costs to
ratepayers is currently being addressed in both water and energy utility proceedings. These
proceedings, as well as the Commissions coordinated effort with other state agencies, have
11 Santa Clara Valley Water District, Eastern Municipal Water District, and East Bay Municipal Utility District. 12 William Maddaus, Gwendolyn Gleason, and John Darmody, Integrating Conservation into Water Supply Planning, p.1.
6
resulted in significant progress towards improving water conservation and efficiency by private
water utilities in California, thereby reducing water, energy, and wastewater consumption as well
as reducing greenhouse gas emissions, through the implementation of: 1) pilot water
conservation programs within energy utility efficiency programs; 2) Water Conservation OII; 3)
participation in Water Energy Team (WET) and Climate Action Team (CAT); and 4)
participation in Delta Vision Initiative.
E. Energy Utility Proceedings In R.06-04-01013 and associated applications,14 the Commission is evaluating pilot
programs, currently in progress between Commission regulated energy utilities and municipal
water providers that provide water-related energy savings. These types of energy saving efforts
have not been generally undertaken by either water or energy utilities.
In D.07-12-050, “Order Approving Pilot Water Conservation Programs within the Energy
Utilities’ Energy Efficiency Programs”, issued in December 2005,15 the Commission authorized
approximately $6.4 million to fund programs, evaluations, and studies to be undertaken by the
energy investor owned utilities (energy IOUs).16 The purpose of these studies is to determine the
most cost-effective means for achieving energy savings from water conservation and efficiency,
and will be used by the Commission in the development of optimal policies for reducing water,
energy, and wastewater costs for the regulated utility customers of California.
These studies, which will run from July 2008 to July 2009, are currently in the initial
stages, with a Final Evaluation Report in January 2010. The pilot studies will include but not
limited to an assessment of - recycled water, high-efficiency toilets, managed landscape, large
industrial customer audits, and gas pump testing. The studies will address statewide/regional
water-energy relationships and a water agency/function component.17
An additional outcome of this proceeding has been the coordinated effort of regulated
energy and water utilities in the development and demonstration of energy efficiency projects in
13 Per ACRSM dated May 24, 2006. 14 A. 07-01-024, -026, -029, and -030. 15 D. 07-12-050 in A.07-01-024, -026, -029, and -030, COMMISSION, “Order Approving Pilot Water Conservation Programs Within The Energy Utilities’ Energy Efficiency Programs”. http://docs.Commission.ca.gov/PUBLISHED/FINAL_DECISION/76926.htm 16 The energy IOUs are Pacific Gas & Electric, San Diego Gas & Electric, Southern California Gas, and Southern California Edison. 17 Study will include a redefined Load Profile Study designed to establish annual and daily load profiles for energy as a function of water delivery requirements in California.
7
water distribution systems across the state. For example, the regulated energy and water utilities
have discussed the deployment of variable frequency drive motors for water pumps, in order to
determine possible energy efficiency gains. As a result, a request is pending in this proceeding
for additional funding to support eight such pilot programs at six regulated water utilities.
F. Water Utility Proceedings As stated earlier, in Phase I of the water conservation OII, the Commission authorized a
MCBA, in which the utility records the increase or decrease of purchased water, purchased
power, and pump tax, since the utility’s last general rate case. The MCBA makes the utility
whole if costs go up and allows for any reduction in these costs to be passed on to the ratepayers.
In February 2008, the Assigned Commissioner issued a scoping memo for Phase II of the
water conservation OII, outlining a number of the non-rate design issues that the Commission is
interested in addressing, including issues identified by parties to the proceeding.18 The scope of
Phase II will include but not be limited to the following water conservation related issues: 1)
implementation of Best Management Practices (BMPs);19 2) water conservation goals for Class
A water utilities; 3) establishing performance metrics and reporting requirements for price and
non-price conservation programs; 4) integrated water resource management; 5) advanced
metering programs and billing; and 6) water shortage event planning.
Since the Commission is currently receiving comments from parties regarding the
proposed issues to be addressed in Phase II and the issues have not been finalized, further detail
is not available at this time.
G. Coordination with Other State Agencies The Commission is an active member of the WET CAT Team (WET CAT), one of about
a dozen Climate Action Teams (CAT) working towards the common goal of reducing energy
consumption from fossil fuels, thereby reducing greenhouse gas emissions (GHG).20 The WET
CAT is proposing five strategies for private and public water systems: 1) Water Recycling;
18 Division of Ratepayer Advocates (DRA), The Consumer Federation of America, Disability Rights Advocates, Latino Issues Forum, National Consumer Law Center, and The Utility Reform Network. 19 The Commission is considering whether to require Class A water utilities to implement the California Urban Water Conservation Council recommended BMPs. 20 The Climate Actions Teams, including WET CAT, are comprised of various state agency representatives, with an objective of recommending policies for the California Air Resources Board (CARB) to implement for achieving the goals of AB 32, the California Global Warming Solutions Act of 2006. The primary goal of AB 32 is a 25 percent GHG emission reduction by 2020, and an 80 percent GHG emission reduction by 2050.
8
2) Urban Water Reuse; 3) End Use Water Conservation and Efficiency; 4) Reducing Energy
Intensity of Water Systems; and 5) Increasing Renewable Energy Production.
The California Air Resources Board (CARB) will issue the public scoping plan
containing the strategies of the various CAT groups, including WET CAT, in late June 2008. The
Commission will ensure that California’s privately-owned water utilities implement the
strategies identified above, as well as all other strategies ultimately adopted by CARB. These
strategies are also expected to reduce water, energy, and wastewater costs.
The Commission is also active in the Delta Vision Initiative, 21 working with other state
agencies to address policies and programs which can prevent and mitigate a catastrophic event in
the Delta22.
The Commission also co-sponsored23 a symposium entitled “Improving the Efficiency of
California Water and Energy Systems” in March 2006, in which public and private sector experts
discussed policies and technologies which could achieve energy savings with water conservation
and efficiency.24 In January 2007, the Commission and the Low-Income Oversight Board
(LIOB) co-hosted a panel discussion addressing the synergies between water and energy
conservation.25 The panels consisted of representatives from both regulated and municipal
water and energy utilities.
21 Commission President, Michael Peevey, is a member of the Delta Vision Committee. 22 Located between Sacramento and Stockton that includes approximately 1,000 miles of waterways. 23 The co-sponsors were the California Energy Commission, Department of Water Resources, and California Independent System Operator. 24 Commission’s , “Improving the Efficiency of California Water and Energy Systems”, http://www.Commission.ca.gov/PUC/Water/WaterEvents/mtgdocs/060328SymposiumPresentations.htm, 3/28/06. 25 “The Synergies of Water and Energy Conservation: A Panel Discussion”, Low Income Oversight Board Meeting of January 2007. ftp://ftp.Commission.ca.gov/puc/water/waterevents/Commission_liob_panel_discussion_notice.pdf or http://www.liob.org/resultsmt.cfm?meetingtype=Board%20Meeting (see January 17, 2007 Meeting, Agenda Items #10 for Presentations).
9
10
IV. Summary & Conclusions
The Commission has achieved material progress in instituting pricing structures to
encourage water conservation through its authorization of water conservation rate design
programs for several Class A water utilities which will be implemented this year. The
Commission has also approved mechanisms that remove the financial disincentives for water
utilities to implement water conservation rates and preserve revenue neutrality.
The Commission has adopted an interim water conservation target for Class A water
utilities of 3%-6% reduction per customer or service connection every three years. This target
will help achieve significant water use reductions and it is in alignment with Governor
Schwarzenegger’s proposed water conservation plan to achieve a 20% reduction in per capita
water use statewide by 2020.
In Phase II of the Commission’s Water Conservation OII, the Commission will continue
developing and advancing water conservation policies. The Commission will address non-rate
design water conservation measures, such as implementing Best Management Practices (BMPs),
establishing performance metrics and reporting requirements for price and non-price
conservation programs, integrated water resource management, advanced metering programs and
billing, and water shortage event planning.
Att
achm
ent A
Su
mm
ary
of W
ater
Con
serv
atio
n R
ate
Des
ign
Prog
ram
s C
lass
A W
ater
Util
ities
Des
crip
tion
Cal
iforn
ia W
ater
Se
rvic
e Pa
rk W
ater
Su
burb
an W
ater
C
alifo
rnia
A
mer
ican
L
os A
ngel
es
San
Jose
Wat
er*
Gol
den
Stat
e W
ater
*
Res
iden
tial C
onse
rvat
ion
Rat
es
T
wo-
Tier
T
hree
-Tie
r
Non
-Res
iden
tial
Con
serv
atio
n R
ates
Wat
er R
ate
Adj
ustm
ent
Mec
hani
sm
Mod
ified
Cos
t Bal
anci
ng
Acc
ount
Cus
tom
er E
duca
tion
&
Out
reac
h Pr
ogra
ms
Prog
ram
Rep
ortin
g
N
otes
: S
igni
fies t
he p
rogr
am c
ompo
nent
s tha
t are
incl
uded
in th
e w
ater
util
ity’s
con
serv
atio
n pr
ogra
m.
* Th
e w
ater
con
serv
atio
n ra
te d
esig
n pr
ogra
ms
for
Gol
den
Stat
e W
ater
and
San
Jos
e W
ater
are
cur
rent
ly u
nder
re
view
by
the
Com
mis
sion
.
Att
achm
ent A
C
alifo
rnia
Wat
er S
ervi
ce C
ompa
ny
Ado
pted
Con
serv
atio
n R
ate
Des
ign
Prog
ram
1 R
esid
entia
l Con
serv
atio
n R
ates
N
on-R
esid
entia
l Con
serv
atio
n R
ates
1)
Tw
o an
d th
ree
tier r
ate
pric
ing
stru
ctur
e;
2) T
ier r
ates
are
reve
nue
neut
ral;
3) C
al W
ater
div
ided
its 2
4 di
stric
ts in
to 3
gro
ups.
4) G
roup
1 a
nd 2
hav
e tw
o an
d th
ree
tiere
d ra
tes b
ased
on
cons
umpt
ion
patte
rns a
nd se
ason
ality
for e
ach
dist
rict.
Non
-res
iden
tial c
usto
mer
s are
cat
egor
ized
into
tw
o gr
oups
: 1)
cus
tom
ers w
ith m
eter
s 6”
diam
eter
and
und
er;
2) c
usto
mer
s with
met
ers 8
” di
amet
er a
nd o
ver;
T
hree
-tie
red
rate
des
ign
& d
istr
icts
T
wo-
tiere
d ra
te d
esig
n &
dis
tric
ts
Sing
le Q
uant
ity c
onse
rvat
ion
Rat
e
D
istri
cts t
hat h
ave
sign
ifica
nt se
ason
al
diff
eren
ces-
-the
aver
age
sum
mer
use
is tw
ice
the
aver
age
win
ter u
se;
Tier
1 c
onsu
mpt
ion
leve
l is s
et fr
om z
ero
to th
e m
idpo
int b
etw
een
aver
age
and
med
ian
win
ter
cons
umpt
ion;
Ti
er 1
rate
is a
dis
coun
ted
sing
le q
uant
ity ra
te;
Ti
er 2
con
sum
ptio
n le
vel i
s set
from
the
top
of
Tier
1 to
the
mid
-poi
nt b
etw
een
wea
ther
adj
uste
d av
erag
e m
onth
ly a
nnua
l con
sum
ptio
n an
d av
erag
e su
mm
er c
onsu
mpt
ion;
Th
e Ti
er 2
rate
is se
t by
adju
stin
g th
e si
ngle
qu
antit
y ch
arge
up
or d
own
to a
chie
ve re
venu
e ne
utra
lity;
Ti
er 3
con
sum
ptio
n le
vel i
s fro
m th
e to
p of
Tie
r 2;
Ti
er 3
rate
is 2
0% a
bove
the
tier 2
rate
.
Dis
trict
s with
less
sign
ifica
nt se
ason
al
diff
eren
ces—
the
aver
age
sum
mer
use
is le
ss
than
twic
e th
e av
erag
e w
inte
r use
;
Ti
er 1
con
sum
ptio
n le
vel i
s set
from
zer
o to
th
e w
inte
r ave
rage
use
;
Ti
er 1
rate
is a
dis
coun
ted
sing
le q
uant
ity
rate
and
var
ies b
y di
stric
t ran
ging
from
89
.75%
and
92.
1% o
f the
sing
le q
uant
ity
rate
;
Ti
er 2
all
cons
umpt
ion
abov
e Ti
er 1
;
Th
e Ti
er 2
rate
is a
ppro
xim
atel
y 18
% to
20
% g
reat
er th
an th
e fir
st ti
er ra
te;
The
Tier
rate
stru
ctur
e w
as n
ot fe
asib
le fo
r no
n-re
side
ntia
l cus
tom
ers b
ecau
se it
requ
ires
recl
assi
ficat
ion
of c
usto
mer
cla
sses
and
cu
stom
er w
ater
con
sum
ptio
n da
ta n
ot
avai
labl
e;
Sing
le q
uant
ity c
onse
rvat
ion
rate
with
re
duce
d se
rvic
e ch
arge
and
incr
ease
d qu
antit
y ch
arge
for r
even
ue n
eutra
lity
Serv
ice
char
ges w
ere
redu
ced
by
appr
oxim
atel
y 10
% to
25%
;
Se
rvic
e ch
arge
redu
ctio
ns w
ere
calc
ulat
ed b
y re
duci
ng th
e m
eter
cha
rge
to a
poi
nt w
here
no
mor
e th
an a
15%
incr
ease
in th
e qu
antit
y ra
te;
1 S
ourc
e of
info
rmat
ion:
June
15,
200
7 am
ende
d se
ttlem
ent a
gree
men
t bet
wee
n Th
e U
tility
Ref
orm
Net
wor
k (T
UR
N),
Div
isio
n of
Rat
epay
er A
dvoc
ates
(DR
A),
and
Cal
iforn
ia W
ater
Ser
vice
Com
pany
.
2
Att
achm
ent A
C
alifo
rnia
Wat
er S
ervi
ce C
ompa
ny
Rat
emak
ing
Gro
upin
g C
al-W
ater
pro
vide
s wat
er se
rvic
e to
24
dist
ricts
. Fo
r the
wat
er c
onse
rvat
ion
rate
des
ign,
dis
trict
s wer
e se
para
ted
into
3 g
roup
s. G
roup
1
Gro
up 2
A
Gro
up 2
B
Gro
up 3
R
esid
entia
l N
on-R
esid
entia
l2R
esid
entia
l N
on-R
esid
entia
l R
esid
entia
l N
on-R
esid
entia
l R
esid
entia
l
Dis
trict
s with
re
duce
d m
eter
ch
arge
and
2 o
r 3
tier q
uant
ity
rate
s
Sing
le q
uant
ity
cons
erva
tion
rate
w
ith re
duce
d se
rvic
e ch
arge
and
incr
ease
d qu
antit
y ch
arge
for
reve
nue
neut
ralit
y
Dis
trict
s with
2
or 3
tier
qu
antit
y ra
tes,
flat a
nd
met
ered
cu
stom
ers
Sing
le q
uant
ity
cons
erva
tion
rate
w
ith re
duce
d se
rvic
e ch
arge
and
in
crea
sed
quan
tity
char
ge fo
r rev
enue
ne
utra
lity
Dis
trict
s with
2
or 3
tier
qua
ntity
ra
tes,
all m
eter
ed
cust
omer
s
Sing
le q
uant
ity
cons
erva
tion
rate
w
ith re
duce
d se
rvic
e ch
arge
and
in
crea
sed
quan
tity
char
ge fo
r rev
enue
ne
utra
lity
Dis
trict
s with
no
tier r
ates
due
to:
1)sm
all n
umbe
r of c
usto
mer
s with
lo
w c
onsu
mpt
ion
leve
ls;
2)Ex
istin
g si
ngle
qua
ntity
rate
is
high
; 3)
Com
mis
sion
ado
pted
Rat
e Su
ppor
t Fun
d (R
FS);
B
aker
sfie
ld
Bak
ersf
ield
C
hico
C
hico
A
ntel
ope
Val
ley
Ant
elop
e V
alle
y B
ear G
ulch
B
ear G
ulch
M
arys
ville
M
arys
ville
La
ncas
ter
Frem
ont
East
Los
A
ngel
es
East
Los
Ang
eles
Le
ona
K
ern
Riv
er
Los A
ltos
Los A
ltos
Dix
on
Dix
on
Red
woo
d Pa
lo V
erde
s Pa
lo V
erde
s
Dom
ingu
ez
Coa
st S
prin
gs
Salin
as
Salin
as
Will
ows
Will
ows
Her
mos
a
Luce
rne
Stoc
kton
St
ockt
on
Kin
g C
ity
Kin
g C
ity
Uni
ted
Oro
ville
O
rovi
lle
Live
rmor
e Se
lma
Selm
a M
id P
enin
sula
V
isal
ia
Vis
alia
So
. San
Fra
ncis
co
Lanc
aste
r W
est L
ake
Leon
a
Dom
ingu
ez
Her
mos
a Li
verm
ore
Mid
Pen
insu
la
So. S
an F
ranc
isco
Wes
t Lak
e
2 N
on-r
esid
entia
l Gro
up 1
dis
trict
s con
sist
s of d
istri
cts w
here
mor
e th
an 7
0% o
f the
reve
nue
com
es fr
om th
e qu
antit
y ch
arge
and
non
-res
iden
tial g
roup
2 w
here
less
than
70
%.
3
Att
achm
ent A
C
alifo
rnia
Wat
er S
ervi
ce C
ompa
ny
F
inan
cial
Mec
hani
sms
Wat
er R
even
ue A
djus
tmen
t Mec
hani
sm (W
RA
M)
Mod
ified
Cos
t Bal
anci
ng A
ccou
nt (M
CB
A)
Each
rate
mak
ing
area
has
a se
para
te W
RA
M;
WR
AM
trac
ks th
e di
ffer
ence
bet
wee
n ad
opte
d re
venu
e an
d ac
tual
reve
nue
excl
udin
g: fi
re se
rvic
e re
venu
e; u
n-m
eter
ed se
rvic
e re
venu
e; a
nd o
ther
non
-gen
eral
m
eter
ed se
rvic
e re
venu
e.
WR
AM
ens
ures
reco
very
of f
ixed
cos
ts th
at a
re re
cove
red
thro
ugh
the
quan
tity
char
ge a
nd v
aria
ble
cost
s not
incl
uded
in th
e M
CB
As.
WR
AM
incl
udes
var
iabl
e co
sts o
ther
than
pur
chas
ed p
ower
, pur
chas
ed w
ater
, and
pu
mp
tax.
Fi
xed
cost
s exc
lude
d fr
om W
RA
M a
re re
cove
red
thro
ugh
the
met
er c
harg
e, w
hich
ar
e m
onth
ly c
harg
es th
at c
usto
mer
s pay
rega
rdle
ss o
f con
sum
ptio
n.
MC
BA
s cap
ture
cos
t sav
ings
and
incr
ease
s as
soci
ated
with
pur
chas
ed w
ater
, pur
chas
ed p
ower
, an
d pu
mp
taxe
s.
M
CB
As t
rack
the
diff
eren
ce b
etw
een
actu
al a
nd
adop
ted
varia
ble
cost
s for
cos
ts th
at a
re re
cove
red
via
the
quan
tity
char
ge fo
r pur
chas
ed w
ater
, pu
rcha
sed
pow
er, a
nd p
ump
tax.
M
CB
As w
ill re
plac
e th
e C
al-W
ater
’s In
crem
enta
l C
ost B
alan
cing
Acc
ount
s (IC
BA
s)
4
Att
achm
ent A
C
alifo
rnia
Wat
er S
ervi
ce C
ompa
ny
C
usto
mer
Edu
catio
n Pr
ogra
m R
epor
ting
C
onse
rvat
ion
rate
info
rmat
ion
notic
es w
ill b
e pr
ovid
ed in
Eng
lish,
Spa
nish
, and
in
othe
r lan
guag
es p
rom
inen
tly u
sed
by it
s cus
tom
ers o
n its
web
site
in th
e sa
me
lang
uage
s.
Cal
Wat
er a
gree
s to
use
acce
ssib
le m
eans
of c
omm
unic
atio
n to
mee
t the
nee
ds o
f he
arin
g an
d/or
vis
ion-
impa
ired
cust
omer
s whi
le m
eetin
g w
ith d
isab
ility
righ
ts
advo
cate
s to
dete
rmin
e th
e be
st w
ay to
mak
e th
is in
form
atio
n ac
cess
ible
to
cust
omer
s with
dis
abili
ties.
Cal
Wat
er w
ill p
rovi
de a
not
ice
to C
omm
unity
Bas
ed O
rgan
izat
ions
(inc
ludi
ng
orga
niza
tions
repr
esen
ting
the
inte
rest
s of p
erso
ns w
ith d
isab
ilitie
s) w
ithin
its
serv
ice
area
s so
that
they
can
pub
liciz
e th
e co
nser
vatio
n ra
te d
esig
n.
Cal
Wat
er w
ill su
bmit
copi
es o
f the
cus
tom
er n
otic
es to
the
Div
isio
n of
Rat
epay
er
Adv
ocat
es fo
r com
men
t prio
r to
dist
ribut
ion.
C
usto
mer
edu
catio
n an
d ou
treac
h pr
ogra
m w
ill b
e m
emor
ializ
ed in
a
Mem
oran
dum
of U
nder
stan
ding
.
Cal
Wat
er w
ill re
port
to th
e C
omm
issi
on re
gula
rly o
n ch
ange
s in
cons
umpt
ion
afte
r the
eff
ectiv
e da
te o
f the
co
nser
vatio
n ra
tes.
Th
e re
porti
ng d
etai
ls th
e ch
ange
s by
clas
s and
by
met
er
size
.
5
Att
achm
ent A
Pa
rk W
ater
Com
pany
Pi
lot C
onse
rvat
ion
Rat
e D
esig
n Pr
ogra
m
R
esid
entia
l Con
serv
atio
n R
ates
N
on-R
esid
entia
l Con
serv
atio
n R
ates
Tw
o tie
red
incr
easi
ng b
lock
pric
ing
stru
ctur
e fo
r qu
antit
y/vo
lum
etric
rate
s;
Tier
rate
s are
reve
nue
neut
ral;
Ti
er 1
con
sum
ptio
n le
vel i
s set
from
zer
o un
its to
the
med
ian
and
the
aver
age
win
ter c
onsu
mpt
ions
(pro
xy fo
r in
door
wat
er u
se);
Tier
2 –
All
cons
umpt
ion
abov
e Ti
er 1
.
Ti
er 1
rate
is a
ppro
xim
atel
y 96
.5%
of t
he si
ngle
qua
ntity
rate
stru
ctur
e;
Ti
e2 ra
te is
app
roxi
mat
ely
10%
hig
her t
han
tier 1
.
Sing
le q
uant
ity ra
te st
ruct
ure;
R
even
ue n
eutra
l;
Se
rvic
e ch
arge
was
redu
ced
by a
ppro
xim
atel
y 18
% a
nd th
e si
ngle
qua
ntity
cha
rge
by a
ppro
xim
atel
y 8%
.
75
% o
f tot
al re
venu
es (e
xclu
ding
reve
nues
from
fees
, fire
pr
otec
tion
serv
ice
and
tem
pora
ry se
rvic
e) a
re re
cove
red
from
the
quan
tity
char
ge.
6
Att
achm
ent A
Pa
rk W
ater
Com
pany
F
inan
cial
Mec
hani
sms
F
inan
cial
Mec
hani
sms
Wat
er R
even
ue A
djus
tmen
t Mec
hani
sm (W
RA
M)
Mod
ified
Cos
t Bal
anci
ng A
ccou
nt (M
CB
A)
Each
rate
mak
ing
area
has
a se
para
te W
RA
M;
WR
AM
trac
ks th
e di
ffer
ence
bet
wee
n ad
opte
d re
venu
e an
d ac
tual
reve
nue
excl
udin
g: fi
re se
rvic
e re
venu
e; u
n-m
eter
ed se
rvic
e re
venu
e; a
nd o
ther
non
-gen
eral
m
eter
ed se
rvic
e re
venu
e.
WR
AM
ens
ures
reco
very
of f
ixed
cos
ts th
at a
re re
cove
red
thro
ugh
the
quan
tity
char
ge a
nd v
aria
ble
cost
s not
incl
uded
in th
e M
CB
As.
The
reve
nue
track
ed in
the
WR
AM
ass
ocia
ted
with
the
varia
ble
cost
s of p
urch
ased
po
wer
, pur
chas
ed w
ater
, and
pum
p ta
x is
off
set b
y th
e M
CB
As.
Fixe
d co
sts e
xclu
ded
from
WR
AM
are
reco
vere
d th
roug
h th
e m
eter
cha
rge,
whi
ch
are
mon
thly
cha
rges
that
cus
tom
ers p
ay re
gard
less
of c
onsu
mpt
ion.
M
ore
spec
ifica
lly, t
he W
RA
M w
ill tr
ack
the
diff
eren
ce b
etw
een
Ado
pted
Rev
enue
an
d A
ctua
l Rev
enue
, exc
ludi
ng re
venu
e fr
om: F
ire se
rvic
e; U
n-m
eter
ed S
ervi
ce;
Rec
laim
ed W
ater
met
ered
serv
ice;
and
Fee
s (re
conn
ectio
n fe
es, l
ate
fees
, etc
.)
MC
BA
s cap
ture
cos
t sav
ings
and
incr
ease
s as
soci
ated
with
pur
chas
ed w
ater
, pur
chas
ed p
ower
, an
d pu
mp
taxe
s.
In
par
ticul
ar, t
he M
CB
As w
ill tr
ack
the
diff
eren
ce
betw
een
Act
ual V
aria
ble
Cos
ts a
nd A
dopt
ed
Var
iabl
e C
osts
for t
he fo
llow
ing
varia
ble
cost
s (w
hich
are
reco
vere
d th
roug
h th
e qu
antit
y ch
arge
un
der b
oth
the
curr
ent a
nd p
ropo
sed
rate
des
igns
): pu
rcha
sed
wat
er, p
urch
ased
pow
er, a
nd p
ump
tax.
A
n M
CB
A w
ill re
plac
e ea
ch o
f the
cur
rent
bal
anci
ng
acco
unts
, now
refe
rred
to a
s Inc
rem
enta
l Cos
t B
alan
cing
Acc
ount
s (IC
BA
s), w
hich
is b
ette
r be
caus
e M
CB
As t
rack
cos
t cha
nges
attr
ibut
able
to
all c
hang
es in
con
sum
ptio
n (in
clud
ing
chan
ges i
n un
it pr
ice)
.
7
Att
achm
ent A
Pa
rk W
ater
Com
pany
Cus
tom
er E
duca
tion
Prog
ram
Rep
ortin
g
Park
agr
ees t
o w
ork
with
DR
A a
nd o
ther
con
sum
er o
rgan
izat
ions
to d
evel
op a
cu
stom
er e
duca
tion
and
outre
ach
prog
ram
ass
ocia
ted
with
impl
emen
ting
the
new
co
nser
vatio
n ra
te d
esig
n.
The
prog
ram
will
incl
ude
notic
es in
Eng
lish,
Spa
nish
, and
in o
ther
lang
uage
s pr
omin
ently
use
d by
Par
k cu
stom
ers a
long
with
con
serv
atio
n ra
te in
form
atio
n av
aila
ble
on it
s web
site
in th
e sa
me
lang
uage
s.
Pa
rk a
gree
s to
use
acce
ssib
le m
eans
of c
omm
unic
atio
n to
mee
t the
nee
ds o
f he
arin
g an
d/or
vis
ion-
impa
ired
cust
omer
s whi
le m
eetin
g w
ith d
isab
ility
righ
ts
advo
cate
s to
dete
rmin
e th
e be
st w
ay to
mak
e th
is in
form
atio
n ac
cess
ible
to
cust
omer
s with
dis
abili
ties.
Park
will
pro
vide
a n
otic
e to
Com
mun
ity B
ased
Org
aniz
atio
ns (i
nclu
ding
or
gani
zatio
ns re
pres
entin
g th
e in
tere
sts o
f per
sons
with
dis
abili
ties)
with
in it
s se
rvic
e ar
eas s
o th
at th
ey c
an p
ublic
ize
the
cons
erva
tion
rate
des
ign.
Pa
rk w
ill su
bmit
copi
es o
f the
cus
tom
er n
otic
es to
the
Div
isio
n of
Rat
epay
er
Adv
ocat
es fo
r com
men
t prio
r to
dist
ribut
ion.
Park
reac
hed
a se
ttlem
ent o
n D
ata
colle
ctio
n,
Mon
itorin
g, a
nd R
epor
ting
whi
ch w
as a
dopt
ed b
y th
e C
omm
issi
on. I
t cal
ls fo
r ann
ual r
epor
ting
to th
e C
omm
issi
on th
roug
h a
supp
lem
ent t
o th
e A
nnua
l R
epor
t.
Th
e co
nsum
ptio
n w
ill b
e tra
cked
but
, bec
ause
Par
k is
im
plem
entin
g ot
her c
onse
rvat
ion
prog
ram
s to
com
ply
with
the
BM
Ps a
nd o
ur m
embe
rshi
p in
the
CU
WC
C, i
t w
ill b
e di
ffic
ult t
o im
poss
ible
to d
eter
min
e pr
ecis
ely
how
muc
h of
the
cons
erva
tion
resp
onse
is d
ue to
the
rate
de
sign
and
how
muc
h to
oth
er p
rogr
ams,
incl
udin
g th
e cu
stom
er in
form
atio
n/ou
treac
h.
8
Att
achm
ent A
S
ubur
ban
Wat
er S
yste
ms
Ado
pted
Pilo
t Con
serv
atio
n R
ate
Des
ign
Prog
ram
3
Res
iden
tial C
onse
rvat
ion
Rat
es
Serv
ice
Are
a
Tw
o tie
red
incr
easi
ng b
lock
pric
ing
stru
ctur
e fo
r qua
ntity
rate
s with
tier
bre
akpo
ints
set b
y m
eter
si
ze;
Subu
rban
’s ra
te d
esig
n m
aint
ains
the
exis
ting
3 zo
ne ra
te d
iffer
entia
l in
its se
rvic
e ar
ea to
refle
ct
varia
nces
in p
umpi
ng c
osts
ass
ocia
ted
with
pro
vidi
ng se
rvic
e to
hig
her e
leva
tions
;
B
lock
rate
s are
reve
nue
neut
ral b
ased
on
2006
reve
nue
requ
irem
ent;
B
lock
rate
s are
bas
ed o
n se
ason
ality
(win
ter a
nd su
mm
er) a
nd c
onsu
mpt
ion
in e
ach
rate
mak
ing
area
usi
ng 2
006
cale
ndar
yea
r cus
tom
er c
onsu
mpt
ion
usag
e da
ta;
Se
rvic
e ch
arge
s rem
ain
unch
ange
d fo
r all
cust
omer
cla
sses
;
B
lock
1 c
onsu
mpt
ion
leve
l is s
et fr
om z
ero
units
to th
e m
id-p
oint
bet
wee
n av
erag
e m
onth
ly
cons
umpt
ion
over
an
entir
e ye
ar a
nd th
e av
erag
e su
mm
er c
onsu
mpt
ion.
B
lock
2 –
All
cons
umpt
ion
abov
e B
lock
1, w
hich
is se
t at c
onsu
mpt
ion
grea
ter t
han
the
sum
mer
aver
age
cons
umpt
ion.
B
lock
1 ra
te is
dec
reas
ed a
ppro
xim
atel
y 2.
0% fo
r San
Jose
Hill
s and
2.5
% fo
r Whi
ttier
/La
Mira
da;
B
lock
2 ra
te fo
r the
var
ious
ele
vatio
n zo
nes a
re 8
.0%
to 1
4.0%
hig
her t
han
Blo
ck 1
rate
s bas
ed o
n
cons
umpt
ion
patte
rns a
nd m
eter
size
.
Subu
rban
serv
es a
ppro
xim
atel
y 75
,000
cus
tom
ers i
n th
e se
rvic
e ar
eas o
f Whi
ttier
/La
Mira
da, a
nd
San
Jose
Hill
s;
Wat
er c
onse
rvat
ion
rate
s are
app
licab
le
to re
side
ntia
l cus
tom
ers o
nly;
Su
burb
an w
ill p
ropo
se c
onse
rvat
ion
rate
s for
oth
er c
usto
mer
cla
sses
in th
eir
next
Gen
eral
Rat
e C
ase;
3 S
ourc
e of
info
rmat
ion:
Apr
il 24
, 200
7 m
otio
n of
Div
isio
n of
Rat
epay
er A
dvoc
ates
and
Sub
urba
n W
ater
Sys
tem
s to
appr
ove
the
settl
emen
t agr
eem
ents
.
9
Att
achm
ent A
Su
burb
an W
ater
Sys
tem
s
Wat
er R
even
ue A
djus
tmen
t Mec
hani
sm (W
RA
M)
Cus
tom
er E
duca
tion
& O
utre
ach
Each
rate
mak
ing
area
(Whi
ttier
/La
Mira
da a
nd S
an Jo
se H
ills)
will
hav
e a
sepa
rate
W
RA
M;
WR
AM
will
trac
k th
e di
ffere
nces
bet
wee
n th
e re
venu
es fo
r act
ual m
eter
ed sa
les a
t th
e bl
ock
volu
met
ric ra
te, a
nd th
e un
iform
sing
le q
uant
ity ra
tes o
n a
mon
thly
ba
sis;
W
RA
M u
nder
-col
lect
ions
or o
ver-
colle
ctio
n w
ill b
e pa
ssed
on
to ra
tepa
yers
th
roug
h su
rcha
rge
or su
rcre
dit;
Subu
rban
’s W
RA
M d
oes n
ot c
ompl
etel
y de
-cou
ple
wat
er re
venu
es fr
om sa
les;
Subu
rban
will
pro
vide
cus
tom
ers w
ith c
onse
rvat
ion
rate
cu
stom
er n
otic
es
Not
ices
will
incl
ude
writ
ten
info
rmat
ion
on c
onse
rvat
ion
rate
s exp
lain
ing
why
thei
r rat
es a
re b
eing
cha
nge,
and
th
e es
timat
ed im
pact
on
cust
omer
’s m
onth
ly b
ill.
Subu
rban
will
pro
vide
a sh
ort s
umm
ary
in S
pani
sh o
f th
e co
nser
vatio
n ra
te c
usto
mer
not
ice
on th
e bi
ll, w
ith a
nu
mbe
r to
call
to re
ques
t a c
opy
of th
e no
tice
in
Span
ish.
Su
burb
an w
ill p
rovi
de k
ey in
form
atio
n in
the
notic
e in
la
rge
type
whi
le in
clud
ing
cont
act i
nfor
mat
ion
usin
g th
e Su
burb
an w
ebsi
te.
Su
burb
an w
ill su
bmit
notic
es to
the
Com
mis
sion
’s
Publ
ic A
dvis
or’s
Off
ice
for r
evie
w.
10
Att
achm
ent A
C
alifo
rnia
Am
eric
an W
ater
– L
os A
ngel
es D
istr
ict
Ado
pted
Pilo
t Con
serv
atio
n R
ate
Des
ign
Prog
ram
4
Res
iden
tial C
onse
rvat
ion
Rat
es
Non
-Res
iden
tial C
onse
rvat
ion
Rat
es
Thre
e tie
red
incr
easi
ng b
lock
pric
ing
stru
ctur
e fo
r qua
ntity
rate
s with
tier
br
eakp
oint
s set
by
met
er si
ze;
C
al A
m se
rves
app
roxi
mat
ely
27,2
00 c
usto
mer
s in
its L
os A
ngel
es
Dis
trict
;
B
lock
rate
s are
reve
nue
neut
ral b
ased
on
2006
and
200
7 co
nsum
ptio
n da
ta;
A
seas
onal
add
er is
app
lied
to v
olum
etric
rate
s of T
ier 2
and
Tie
r 3 d
urin
g th
e su
mm
er m
onth
s;
T
he p
ortio
n of
fixe
d co
st re
cove
red
in th
e se
rvic
e ch
arge
is re
duce
d to
50
% o
f wha
t was
reco
vere
d un
der t
he tr
aditi
onal
rate
des
ign;
W
inte
r – N
ovem
ber 1
– A
pril
30’
W
inte
r Tie
r 1 is
app
roxi
mat
ely
15-2
0% h
ighe
r tha
n cu
rren
t sin
gle
volu
met
ric ra
te;
W
inte
r Tie
r 2 is
app
roxi
mat
ely
10%
hig
her t
han
Tier
1;
W
inte
r Tie
r 3 is
app
roxi
mat
ely
20%
hig
her t
han
Tier
1;
Su
mm
er –
May
1 –
Oct
ober
31
Su
mm
er T
ier 1
is a
ppro
xim
atel
y 15
-21%
hig
her t
han
the
curr
ent s
ingl
e vo
lum
etric
rate
;
Su
mm
er T
ier 2
is a
ppro
xim
atel
y 15
% g
reat
er th
an T
ier 1
;
Ti
er 3
is a
ppro
xim
atel
y 25
% g
reat
er th
an T
ier 1
..
Non
-Res
iden
tial C
usto
mer
s inc
lude
the
com
mer
cial
, ind
ustri
al, p
ublic
au
thor
ity, g
ravi
ty ir
rigat
ion,
and
pre
ssur
e irr
igat
ion
cust
omer
cla
sses
;
C
onse
rvat
ion
rate
des
ign
cons
ists
of a
redu
ced
serv
ice
char
ge a
nd a
si
ngle
(uni
form
) qua
ntity
cha
rge
Th
e si
ngle
qua
ntity
cha
rge
will
reco
ver a
gre
ater
per
cent
age
of fi
xed
cost
than
the
sing
le q
uant
ity c
harg
e th
at w
ould
resu
lt fr
om th
e st
anda
rd
rate
des
ign
curr
ently
in p
lace
Se
rvic
e ch
arge
s will
be
redu
ced
by a
ppro
xim
atel
y 50
%, w
ith
corr
espo
ndin
g in
crea
ses i
n th
e qu
antit
y ra
te to
ach
ieve
reve
nue
reco
very
neu
tralit
y.
Se
ason
al A
dder
will
incr
ease
qua
ntity
rate
s dur
ing
the
sum
mer
mon
ths
to re
duce
pea
k de
man
d.
Th
ere
will
be
a 10
% d
iffer
entia
l bet
wee
n w
inte
r and
sum
mer
rate
s..
4 S
ourc
e of
info
rmat
ion:
Apr
il 24
, 200
7 m
otio
n of
Div
isio
n of
Rat
epay
er A
dvoc
ates
and
Sub
urba
n W
ater
Sys
tem
s to
appr
ove
the
settl
emen
t agr
eem
ents
.
11
Att
achm
ent A
C
alifo
rnia
Am
eric
an –
Los
Ang
eles
Dis
tric
t
Wat
er R
even
ue A
djus
tmen
t Mec
hani
sm (W
RA
M)
Mod
ified
Cos
t Bal
anci
ng A
ccou
nt (M
CB
A)
Each
rate
mak
ing
area
in th
e Lo
s Ang
eles
Dis
trict
(San
Mar
ino,
Dua
rte, a
nd
Bal
dwin
Hill
s) w
ill h
ave
a se
para
te W
RA
M;
Th
e W
RA
M w
ill tr
ack
the
diff
eren
ce b
etw
een
the
tota
l qua
ntity
cha
rge
reve
nues
au
thor
ized
by
the
Com
mis
sion
, and
the
tota
l rev
enue
s act
ually
reco
vere
d th
roug
h th
e qu
antit
y ch
arge
bas
ed o
n ac
tual
sale
s, ex
clud
ing
reve
nue
from
Priv
ate
Fire
Pr
otec
tion
Serv
ice
and
from
the
“Oth
er”
clas
s of g
ener
al m
eter
ed c
usto
mer
s;
R
ecov
ery
of u
nder
-col
lect
ions
and
refu
nds o
f ove
r-co
llect
ions
will
be
pass
ed o
n to
ra
tepa
yers
thro
ugh
volu
met
ric su
rcha
rges
and
surc
redi
ts.
Th
e M
CB
As w
ill c
aptu
re th
e co
st sa
ving
s and
cos
t in
crea
ses a
ssoc
iate
d w
ith p
urch
ased
wat
er, p
urch
ased
po
wer
, and
pum
p ta
xes (
all o
f whi
ch a
re re
cove
red
thro
ugh
the
quan
tity
char
ge u
nder
bot
h th
e cu
rren
t and
pr
opos
ed ra
te d
esig
ns).
Th
e M
CB
A w
ill re
plac
e an
y “i
ncre
men
tal c
ost
bala
ncin
g ac
coun
ts”
Cal
iforn
ia A
mer
ican
cur
rent
ly h
as
in it
s Los
Ang
eles
Dis
trict
.
Prog
ram
Rep
ortin
g
Cal
iforn
ia-A
mer
ican
Wat
er w
ill tr
ack
data
, suc
h as
bill
ing
and
usag
e da
ta b
y m
eter
si
ze, b
y m
onth
, and
by
clas
s of c
usto
mer
, for
use
in a
naly
zing
cus
tom
er re
spon
se
to th
e pr
opos
ed c
onse
rvat
ion
rate
s so
that
it is
read
ily a
vaila
ble
to th
e C
omm
issi
on
and
the
Parti
es to
eva
luat
e re
sults
of t
he P
ilot P
rogr
am.
12
Att
achm
ent A
S
an J
ose
Wat
er C
ompa
ny
Prop
osed
Pilo
t Con
serv
atio
n R
ate
Des
ign
Prog
ram
5
Prop
osed
Res
iden
tial C
onse
rvat
ion
Rat
es
Prop
osed
Non
-Res
iden
tial
Con
serv
atio
n R
ates
Se
rvic
e A
rea
Two
tiere
d in
crea
sing
blo
ck p
ricin
g st
ruct
ure
for q
uant
ity
or v
olum
etric
rate
s with
tier
bre
akpo
ints
set b
y m
eter
size
;
Ti
er ra
tes a
re re
venu
e ne
utra
l bas
ed o
n 20
06 re
venu
e
requ
irem
ent;
Ti
er ra
tes a
re b
ased
on
seas
onal
ity (w
inte
r and
sum
mer
)
and
cons
umpt
ion
in e
ach
rate
mak
ing
area
usi
ng 2
006
cale
ndar
yea
r cus
tom
er c
onsu
mpt
ion
usag
e da
ta;
M
eter
cha
rges
rem
ain
unch
ange
d fo
r all
cust
omer
cla
sses
;
Ti
er 1
con
sum
ptio
n le
vel i
s set
from
zer
o un
its to
the
mid
-po
int b
etw
een
aver
age
mon
thly
con
sum
ptio
n ov
er a
n en
tire
year
and
the
aver
age
cons
umpt
ion
durin
g th
e w
inte
r m
onth
s.
Ti
er 2
– A
ll co
nsum
ptio
n ab
ove
Tier
1.
Ti
er 1
rate
is a
ppro
xim
atel
y 3.
23%
low
er fr
om th
e si
ngle
quan
tity
rate
stru
ctur
e;
Ti
e2 ra
te is
app
roxi
mat
ely
10%
hig
her t
han
tier 1
.
No
chan
ge to
exi
stin
g ra
te st
ruct
ure
for
the
busi
ness
, ind
ustri
al, p
ublic
au
thor
ity, r
esal
e, p
rivat
e fir
e, a
nd
recl
aim
ed/re
cycl
ed c
usto
mer
cla
sses
.
N
o ch
ange
to ra
tes b
ecau
se
appr
oxim
atel
y 81
% o
f the
tota
l rev
enue
is
alre
ady
allo
cate
d to
vol
ume
rate
s.
San
Jose
Wat
er C
ompa
ny (S
JWC
) pr
ovid
es w
ater
serv
ice
to
appr
oxim
atel
y 19
9,00
0 re
side
ntia
l cu
stom
ers a
nd 1
6,00
0 no
n-re
side
ntia
l cu
stom
ers l
ocat
ed in
San
Jose
, C
uper
tino,
Cam
pbel
l, Lo
s Gat
os,
Mon
te S
eren
o, S
arat
oga
and
cont
iguo
us te
rrito
ry in
the
Cou
nty
of
Sant
a C
lara
.
A
ll of
SJW
C’s
cus
tom
ers a
re m
eter
ed
and
are
prov
ided
bill
s on
a tw
o-m
onth
cy
cle.
Th
e pr
opos
ed c
onse
rvat
ion
rate
s will
be
app
licab
le to
all
of S
JWC
’s se
rvic
e ar
ea.
5 S
ourc
e of
info
rmat
ion:
Nov
embe
r 14,
200
7 Se
ttlem
ent A
gree
men
t bet
wee
n D
RA
and
San
Jose
Wat
er C
ompa
ny o
n co
nser
vatio
n ra
te d
esig
n is
sues
.
13
Att
achm
ent A
Sa
n Jo
se W
ater
Com
pany
F
inan
cial
Mec
hani
sm
Prop
osed
Wat
er R
even
ue A
djus
tmen
t Mec
hani
sm (W
RA
M)
Prop
osed
Bal
anci
ng A
ccou
nt fo
r W
ater
Pro
duct
ion
Cos
ts
SJW
C w
ithdr
ew it
s req
uest
for t
he fu
ll de
coup
ling
Wat
er R
even
ue A
djus
tmen
t M
echa
nism
(WR
AM
);
Parti
es a
gree
to a
pric
e-ba
sed
WR
AM
con
sist
ent w
ith th
e pr
ice-
base
d “w
ater
re
venu
e ad
just
men
t mec
hani
sm”
adop
ted
for C
alifo
rnia
- Am
eric
an W
ater
C
ompa
ny’s
Mon
tere
y D
istri
ct in
D.9
6-12
-005
.
Ea
ch ra
tem
akin
g ar
ea h
as a
sepa
rate
pric
e-ba
sed
WR
AM
;
Th
e pr
ice-
base
d W
RA
M tr
acks
the
diff
eren
ces b
etw
een
the
reve
nues
for a
ctua
l m
eter
ed sa
les a
t the
tier
ed v
olum
etric
rate
, and
the
unifo
rm si
ngle
qua
ntity
rate
s on
a m
onth
ly b
asis
;
Th
e pr
ice-
base
d W
RA
M d
oes n
ot fu
lly d
ecou
ple
reve
nue
from
sale
s as a
“fu
ll”
wat
er re
venu
e ad
just
men
t mec
hani
sm (o
r “fu
ll W
RA
M”)
wou
ld.
Rec
over
y of
und
er-c
olle
ctio
ns o
r ove
r-co
llect
ion
will
be
pass
ed o
n to
rate
paye
rs
thro
ugh
volu
met
ric c
harg
es a
nd su
rcre
dits
.
SJ
WC
with
drew
its r
eque
st to
con
vert
its in
crem
enta
l co
st b
alan
cing
acc
ount
into
a fu
ll co
st b
alan
cing
ac
coun
t.
SJW
C h
as a
Sup
ply
Off
set A
ccou
nt th
at a
djus
ts fo
r ch
ange
s in
unit
pric
e of
pur
chas
ed w
ater
, pur
chas
ed
pow
er, a
nd p
ump
taxe
s;
Pa
rties
agr
ee th
at S
JWC
will
not
pur
sue
a fu
ll co
st
bala
ncin
g ac
coun
t for
wat
er p
rodu
ctio
n co
sts.
14
Att
achm
ent A
Sa
n Jo
se W
ater
Com
pany
Prop
osed
Cus
tom
er E
duca
tion
Prop
osed
Pro
gram
Rep
ortin
g
The
prop
osed
agr
eem
ent b
etw
een
San
Jose
, DR
A a
nd o
ther
con
sum
er
orga
niza
tions
is to
dev
elop
a c
usto
mer
edu
catio
n an
d ou
treac
h pr
ogra
m fo
r the
im
plem
enta
tion
of th
e ne
w c
onse
rvat
ion
rate
s.
The
cust
omer
edu
catio
n in
itiat
ives
and
the
prog
ram
mon
itorin
g ds
dev
elop
ed w
ill
be d
ocum
ente
d in
a m
emor
andu
m o
f und
erst
andi
ng o
r a se
para
te se
ttlem
ent
agre
emen
t.
In a
settl
emen
t agr
eem
ent b
etw
een
SJW
C a
nd fo
ur
inte
rven
er g
roup
s is t
o pr
ovid
e an
ann
ual r
epor
t on
the
cons
erva
tion
rate
s and
its p
rice-
base
d re
venu
e ad
just
men
t mec
hani
sm a
s a su
pple
men
t to
its A
nnua
l R
epor
t tha
t is f
iled
with
the
Com
mis
sion
.
San
Jose
agr
eed
to w
ork
with
DR
A a
nd o
ther
con
sum
er
grou
ps to
det
erm
ine
how
to e
valu
ate
and
repo
rt th
e ef
fect
iven
ess o
f con
serv
atio
n ra
tes.
15
Att
achm
ent A
G
olde
n St
ate
Wat
er C
ompa
ny
Prop
osed
Pilo
t Con
serv
atio
n R
ate
Des
ign
Prog
ram
6
Res
iden
tial C
onse
rvat
ion
Rat
es
Non
-Res
iden
tial C
onse
rvat
ion
Rat
es
Tw
o tie
red
incr
easi
ng b
lock
pric
ing
stru
ctur
e;
Ti
er ra
tes a
re re
venu
e ne
utra
l;
Ti
er ra
tes v
ary
by d
istri
ct a
nd a
re b
ased
on
2006
cal
enda
r yea
r cus
tom
er
cons
umpt
ion
usag
e da
ta fo
r eac
h se
rvic
e ar
ea;
Ti
er 1
con
sum
ptio
n le
vel i
s set
from
zer
o un
its to
the
aver
age
win
ter
usag
e.
Ti
er 2
– A
ll co
nsum
ptio
n ab
ove
Tier
1.
Ti
er 2
rate
is 1
5% h
ighe
r tha
n th
e Ti
er 1
rate
.
A
gre
ater
per
cent
age
of th
e fix
ed c
ost w
ill b
e re
cove
red
from
the
volu
met
ric ra
te c
ompo
nent
- The
am
ount
of f
ixed
cos
t rec
over
ed in
the
serv
ice
char
ge w
as re
duce
d by
the
follo
win
g pe
rcen
tage
s:
Are
as
% R
educ
ed
Bay
Poi
nt
Los O
sos
Sant
a M
aria
Si
mi V
alle
y R
egio
n II
-R
esid
entia
l -N
on-R
esid
entia
l R
egio
n II
I -R
esid
entia
l -N
on-R
esid
entia
l
12%
37
%
31%
10
%
20
%
5%
21
%
6%
Non
-res
iden
tial c
usto
mer
s inc
lude
all
othe
r met
ered
cus
tom
ers w
ith
clas
sific
atio
n co
de g
reat
er th
an “
1”.
The
resi
dent
ial c
onse
rvat
ion
rate
stru
ctur
e w
as n
ot fe
asib
le fo
r non
-re
side
ntia
l cus
tom
ers b
ecau
se it
requ
ires r
ecla
ssifi
catio
n of
cus
tom
er
clas
ses a
nd c
usto
mer
wat
er c
onsu
mpt
ion
data
cur
rent
ly n
ot a
vaila
ble;
Th
e no
n-re
side
ntia
l int
erim
con
serv
atio
n ra
te d
esig
n fo
r Reg
ions
II &
III
cons
ists
of a
redu
ced
serv
ice
char
ge a
nd a
sing
le q
uant
ity/v
olum
etric
rate
th
at re
cove
rs a
gre
ater
per
cent
age
of fi
xed
cost
:
Th
e am
ount
of f
ixed
cos
t mov
ed to
the
quan
tity
char
ge is
bas
ed o
n th
e bi
ll im
pact
for e
ach
serv
ice
area
.
Se
rvic
e ch
arge
s wer
e re
duce
d by
app
roxi
mat
ely
5% to
10%
, with
co
rres
pond
ing
incr
ease
s in
the
quan
tity
rate
to a
chie
ve re
venu
e ne
utra
lity.
Se
rvic
e ch
arge
redu
ctio
n w
as c
alcu
late
d to
ach
ieve
no
mor
e th
an a
10%
in
crea
se in
the
quan
tity
rate
for e
ither
of t
he tw
o no
n-re
side
ntia
l cus
tom
er
quan
tity
rate
gro
upin
gs.
6 S
ourc
e of
info
rmat
ion:
Oct
ober
19,
200
7 Se
ttlem
ent A
gree
men
t bet
wee
n D
RA
and
Gol
den
Stat
e W
ater
Com
pany
on
WR
AM
& C
onse
rvat
ion
Rat
e D
esig
n Is
sues
.
16
Att
achm
ent A
G
olde
n St
ate
Wat
er C
ompa
ny
Prop
osed
Con
serv
atio
n R
ate
Des
ign
Prog
ram
GSW
C p
rovi
des s
ervi
ce to
app
roxi
mat
ely
250,
000
cust
omer
s in
thre
e re
gion
s com
pris
ed o
f nin
e ra
tem
akin
g ar
eas.
The
con
serv
atio
n ra
te
desi
gns w
ere
grou
p by
the
rate
mak
ing
area
s lis
ted
belo
w.
Reg
ion
I:
Citi
es
Tar
gete
d an
d ex
clud
ed
area
s
Reg
ion
II
Reg
ion
III
Ard
en C
ordo
va
Excl
uded
bec
ause
the
maj
ority
of c
usto
mer
s (72
%)
are
on fl
at ra
tes;
G
SWC
has
a p
lan
to
trans
ition
cus
tom
ers t
o m
eter
ed se
rvic
e B
ay P
oint
In
clud
ed
Cle
arla
ke
Excl
uded
due
to lo
w a
vera
ge
cons
umpt
ion
Lo
s Oso
s In
clud
ed
Oja
i Ex
clud
ed d
ue to
exi
stin
g 3-
tier r
ate
stru
ctur
e w
hich
was
de
term
ined
to b
e su
ffic
ient
Sa
nta
Mar
ia
Incl
uded
Rat
emak
ing
Are
as
Sim
i Val
ley
Incl
uded
R
egio
n-w
ide,
one
ra
tem
akin
g ar
ea;
Wri
ghtw
ood,
App
le
Val
ley,
and
Mor
ongo
ar
eas a
re e
xclu
ded
beca
use
the
Com
mis
sion
ha
s res
trict
ed ra
te
incr
ease
s due
to e
xist
ing
high
rate
s (D
.00-
06-0
75);
Reg
ion-
wid
e, o
ne
rate
mak
ing
area
17
Att
achm
ent A
G
olde
n St
ate
Wat
er C
ompa
ny
Prop
osed
Fin
anci
al M
echa
nism
s
Wat
er R
even
ue A
djus
tmen
t Mec
hani
sm (W
RA
M)
Mod
ified
Cos
t Bal
anci
ng A
ccou
nt (M
CB
A)
Each
rate
mak
ing
area
has
a se
para
te W
RA
M;
WR
AM
trac
ks th
e di
ffer
ence
bet
wee
n A
dopt
ed R
even
ue a
nd A
ctua
l Rev
enue
ex
clud
ing:
Fire
serv
ice
reve
nue;
un-
met
ered
serv
ice
reve
nue;
and
oth
er n
on-
gene
ral m
eter
ed se
rvic
e re
venu
e.
Fixe
d co
sts n
ot in
clud
ed in
the
WR
AM
are
reco
vere
d vi
a th
e se
rvic
e m
onth
ly
char
ge w
hich
cus
tom
ers p
ay re
gard
less
of c
onsu
mpt
ion;
W
RA
M in
clud
es v
aria
ble
cost
s oth
er th
an p
urch
ased
pow
er, p
urch
ased
wat
er, a
nd
pum
p ta
x.
M
CB
As c
aptu
re c
ost s
avin
gs a
nd in
crea
ses a
ssoc
iate
d w
ith p
urch
ased
wat
er, p
urch
ased
pow
er, a
nd p
ump
taxe
s.
M
CB
As t
rack
the
diff
eren
ce b
etw
een
actu
al a
nd a
dopt
ed
varia
ble
cost
s for
cos
ts th
at a
re re
cove
red
via
the
quan
tity
char
ge fo
r pur
chas
ed w
ater
, pur
chas
ed p
ower
, an
d pu
mp
tax.
M
CB
As w
ill re
plac
e th
e Su
pply
Cos
ts B
alan
cing
A
ccou
nts.
18
Att
achm
ent A
19
Gol
den
Stat
e W
ater
Com
pany
Pr
opos
ed C
onse
rvat
ion
Rat
e D
esig
n Pr
ogra
m
C
usto
mer
Edu
catio
n Pr
ogra
m R
epor
ting
G
SWC
agr
ees t
o w
ork
with
DR
A a
nd o
ther
con
sum
er o
rgan
izat
ions
to d
evel
op a
cu
stom
er e
duca
tion
and
outre
ach
prog
ram
ass
ocia
ted
with
impl
emen
ting
the
new
co
nser
vatio
n ra
te d
esig
n.
GSW
C h
as in
itiat
ed d
iscu
ssio
n w
ith m
any
of th
e in
terv
ener
s int
eres
ted
in th
ose
prog
ram
s. G
SWC
will
con
tinue
to w
ork
with
par
ties t
o de
velo
p a
data
col
lect
ion
and
cust
omer
edu
catio
n pl
an.
The
prop
osed
settl
emen
t agr
eem
ent b
etw
een
GSW
C a
nd
four
inte
rven
er g
roup
s is t
o pr
ovid
e an
ann
ual r
epor
t on
the
cons
erva
tion
rate
s and
the
pric
e-ba
sed
reve
nue
adju
stm
ent m
echa
nism
as a
supp
lem
ent t
o its
Ann
ual
Rep
ort f
iled
with
the
Com
mis
sion
.
