The Denver Board of Water Commissioners has adopted rate changes to fund upgrades and new projects to keep Denver Water’s system running smoothly. The new rates take effect March 1, 2018, and monthly bills for most Denver residents will increase by about $2.25 or less if they use water the same as they did in 2017.
The major multi-year projects driving the rate increase include building a new, state-of-the-art water treatment plant, installing a new 8.5-mile water pipeline to replace two pipelines that were built in the 1930s and 1950s, expanding Gross Reservoir to provide a more reliable future water supply, constructing a new water quality lab to ensure the highest water quality standards, investing more than $100 million to repair and replace water pipes, and more. There are 143 major projects identified in Denver Water’s 5-year, $1.25 billion capital plan.
If you live in Denver and use 84,000 gallons of water a year in the same way you did in 2017, you can expect to see an annual increase of about $14, which averages out to a monthly increase of about $1.17 a month. (Summer bills are typically higher because of outdoor water use.) Customers in Denver tend to use less than 84,000 gallons per year and suburban customers tend to use more, but 84,000 gallons represents the median water use for all residential customers.
A customer’s bill is comprised of a fixed charge, which helps ensure Denver Water has more stable revenue to continue the necessary water system upgrades to ensure reliable water service, and a volume rate. The fixed monthly charge — which is tied to meter size — in 2018 is increasing by about $3.50 for a majority of residential customers. To help offset the fixed monthly charge, the charge per 1,000 gallons for many customers will see a small decrease.
Denver Water’s rate structure includes a three-tiered charge for water use (called the volume rate). To keep water affordable, indoor water use — like for bathing, cooking and flushing toilets — is charged at the lowest rate. Essential indoor water use is determined by averaging the customer’s monthly water use on bills dated from January through March each year. This is called average winter consumption. Water use above the average winter consumption — typically for outdoor watering — is charged at a higher price.
Individual water bills will depend on how much water a customer uses and whether the customer lives in Denver or is served by one of 66 suburban distributors under contract with Denver Water. The Denver City Charter requires that suburban customers pay the full cost of service, plus an additional amount. Learn more about how this works: Why Denver water costs more in the ‘burbs.
Denver Water operates and maintains more than 3,000 miles of distribution pipe — enough to stretch from Los Angeles to New York — as well as 20 dams, 22 pump stations, 30 underground storage tanks, four treatment plants and more. The water provider’s collection system covers more than 4,000 square miles, and it operates facilities in 12 counties in Colorado.
Denver Water does not make a profit or receive tax dollars and reinvests ratepayers’ money to maintain and upgrade the water system. The utility is funded by water rates, bond sales, cash reserves, hydropower sales and fees for new service (called System Development Charges).
Customers will see more information about 2018 rates in their bills and on Denver Water’s website over the next few months.