Public Enterprise Revenue and Rate Trends

1. Public Enterprise Revenue and Rate Trends Jeff Hughes Environmental Finance Center School of Government University of North Carolina jhughes@sog.unc.edu 919 843 4956 www.efc.unc.edu

3. Presentation The Enterprises The Outline State of rates State of revenues Notable trends • Water • Wastewater • Stormwater • Electricity • A dash of trash…

4. State of Rates • Water and Wastewaterhttp://efc.unc.edu/RatesDashboards/nc.html • Stormwater http://efc.unc.edu/tools.htm#nc_stormwater_dashboard • Electricity http://efc.unc.edu/projects/NCElectricityRatesDashboard.htm

5. Trends • Revenue increases • Attention to fixed vs. variable revenue • Decreasing sales • Rate increases • More attention on role of municipal utilities

7. Trends Billed Water (MGD) 5.0 4.5 4.0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004

8. The challenge of driving revenue increases through rate increases: HH rate versus revenues increases (2004 to 2010) Preliminary Results Data analysis by the Environmental Finance Center at the University of North Carolina. Data sources: 2010 and 2004 RFC/AWWA Water and Wastewater Rates Survey Data for 82 Utilities

9. Fixed versus variable Data analyzed by the Environmental Finance Center at the University of North Carolina. Data source: Each utility’s customer billing records, project funded by NC Urban Water Consortium

10. Charlotte-Mecklenburg Utilities Water and Sewer Revenues Fixed versus variable Data sources: Mickey Hicks, CFO, Charlotte-Mecklenburg Utilities

12. Annual Rate Increases

13. Outside service getting more attention

14. Do prices reflect the true cost of water?