Jan 29, 2011

BWS method of calculating fees, does not encourage water conservation

This post examines a real Board of Water Supply (BWS) bill to see how the charges are calculated. This example applies to residential properties that have 2 dwelling units on the same meter (ie. a two-family dwelling or a Single-family + Ohana Unit or a Single-Family + Rec Room w/o an interior connection). Multifamily/Apartment and other uses have different rate schedules and are charged differently.

In Honolulu, water is billed every 2 months, see sample BWS bill
You can see from the summary at the top of the invoice that it includes BWS and Sewer charges. The bulk of the fees (ie. $299.48 vs $59.38) are actually Sewer charges, not BWS charges.

On the back of the invoice, is the breakdown.

Sewer fees consist of a "Sewer Base Charge" and a "Sewer Usage Charge".
The Sewer Usage Charge is calculated based on usage or more specifically, the usage indicated on your water meter, which is read bi-monthly. If you look closely at the Sewer Charges, the largest amount is the Sewer Base Charge, which is the minimum fixed amount of $273.56 re-occurring charge every 2-months.

The amount of the entire invoice that is based on usage is very small:
     Water Usage:  $53.01 (based on 19,000 gal of water consumed)

     Sewer Usage: $25.92 (based on 19,000 gal of water consumed)
                         $78.93 (or 22% of the water bill)

vs. the fixed amounts, not based on usage:
     Water billing charge: $   5.84
     Sewer Base Charge:  $273.56
                                  $279.40 (or 78% of the water bill)
Regardless of how much water is used, you will still have to pay $279, minimum, every 2-months. For 2 dwelling units connected on 1 meter, no matter how much water you conserve, 78% of your water bill, will remain the same. To illustrate: the difference in water bill between a property that used 12,000 gallons within a 2-month interval, vs a property that used 19,000 gallons, during the same billing cycle, pays $321.86 vs $358.86. For the additional 7,000 gallons used, the difference on the bi-minthly water bill is only $37, or less than $20 difference per month

Therefore, for properties containing 2 or more dwelling units, the way fees are calculated does not create an incentive for consumers to conserve water. Alternatively, if usage were the primary factor determining our water/sewer bill (similar to our electric bill), consumers could more clearly see the bottom line impact their individual conservation efforts have on their own wallets -- much like the 2009 IECC requirements for electrical sub-metering. As a community, billing based on usage would highlight the linkage between use and conservation.

For single-family properties, the fixed portions of the water bill are approx 35 to 40% (est using 19,000 gal per 2-month interval) of the total bi-monthly invoice.

Sample BWS invoice