Continuous Utility Rate Management and Forecasting

Few things are more contentious in local government than utility rates. Rates matter to customers because of the impact they have on household and corporate budgets. Rates matter to a local government’s utility because they need the resources to pay for meeting residents’ demand for distributing and treating water, while operating within a regulatory environment that requires meeting quality standards for clean water, water conservation, safe treatment, and environmentally organic discharge.

Typically, local governments conduct five-year studies to determine rates. These studies are time-consuming, difficult, and often expensive, and the resulting rate increases can evoke consumer surprise, shock, and anxiety. In 2018, the City of Northglenn, Colorado, had substantial rate increases for the water and sewer utilities, so substantial that the Northglenn management team decided the city needed to change its practice of analyzing user charges once every five years and instead employ a process that brings digital intelligence into continuous utility rate management and forecasting.

• Publication date: June 2021
• Authors: Jason Loveland and JP Joly