Residents of Grand Marais may want to start paying attention to how many gallons of water they are using each month. By January 1, 2013, the Public Utilities Commission will have a higher rate for use that exceeds a certain amount.
The City of Grand Marais received notification from the Minnesota Department of Natural Resources (DNR) in July 2008 that, like other cities with water supply systems serving more than 1,000 residents, it must adopt a “conservation rate structure.”
Minnesota Statute 103G.291 states that a “ ‘conservation rate structure’ means a rate structure that encourages conservation and may include increasing block rates, seasonal rates, time of use rates, individualized goal rates, or excess use rates.”
Such a structure could include block rates that increase as water use exceeds certain parameters, increases designed to be significant enough to encourage conservation. For example, 0-6,000 gallons might cost $2.50/1,000 gallons. The rate for 6,000-12,000 gallons might jump to $3.15/1,000 gallons, the rate for 12,000- 24,000 gallons might jump to $4.00/1,000 gallons, and the rate for over 24,000 gallons might jump to $6.00/1,000 gallons.
According to the U.S. Geological Survey, the average American uses 80-100 gallons of water a day – that adds up to between 2,433 and 3,041 gallons a month. City Administrator Mike Roth said he had heard that the average monthly water use per person was 1,800, and he thought even that seemed higher than the amount used by most Grand Marais residents.
The PUC currently charges $5.25 per 1,000 gallons of water.
A conservation rate structure could bring the price per gallon up to even higher “excess use” rates for the higher use categories, such as $5.00/1,000 gallons for usage between 12,000 and 24,000 gallons and $7.50/1,000 gallons for usage over 24,000 gallons.
Another type of conservation structure might charge more for all water use during warm weather months when people tend to use water outside.
A city could charge more for water use during peak periods each day when water demands tend to be high, or it could set an individual rate for each customer based on how much the customer usually uses in the wintertime when water use is typically at its lowest, charging more per gallon if that customer goes over its base amount.
In setting a conservation rate, cities cannot use as a basic standard a volume that exceeds the average household use for the community.
If a public water supplier wants to construct a public water supply well or requests an increase in the authorized volume of appropriation, it must employ water use demand reduction measures, including an evaluation of its current conservation rate structure, and it must offer a public education program that encourage things like toilet and showerhead retrofitting.
City conservation rate structures must be approved by the DNR.
City administrator Mike Roth stated at a November 4, 2009 Public Utilities Commission (PUC) meeting that the city will need to set a conservation goal. Over the last 25 years, he said, the population of Grand Marais has grown but the city’s water use has not.
City Water/Wastewater Superintendent Tom Nelson, who recently attended a conference at which the new regulation was discussed, said that he was told Grand Marais’ current rate formula “is a good one.”
The statute exempts public water suppliers that do not have “the proper measuring equipment to track the amount of water used by its users.” Administrator Roth stated that a lot of towns don’t even meter their water. Neither Silver Bay nor Two Harbors meter their water, Nelson added.
Nelson said that a different rate could be set for homes and businesses, although “if you’re not careful,” he said, this could run some businesses out of town.
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