The California Water Association (CWA) has unveiled a new video to help demystify the complex ratemaking process for California’s regulated water utilities.
The video—in both English and Spanish—walks viewers through the General Rate Case (GRC) process, which requires the California Public Utilities Commission (CPUC) to conduct a detailed review of the rates and costs of the largest regulated water utilities and then to make any needed adjustments every three years.
“The ratemaking process is complex and can be overwhelming,” said CWA Executive Director Jack Hawks. “That’s why we set out to produce a tool for CWA member companies to use with their customers that distills the process into steps and terms that are more easily understood. The video also highlights opportunities for the public to provide input to their utilities’ rate proceedings.”
The GRC is basically a complete audit and gives everyone an opportunity to take a close look at how a utility operates and to make sure rates are fair and reasonable and can support the delivery of safe, high-quality, and reliable water service.
The video breaks the ratemaking process into five steps and explains how various parties are involved, including the regulated water utility (applicant), Administrative Law Judge, CPUC Commissioners, Public Advocates Office, customers, and other interested stakeholders.
The video also explains how rates are based on the costs of providing service—the actual costs to purchase, extract, pump, transport, and treat the water to strict standards—and clarifies the opportunity for regulated water utilities to earn a return on investor funding to improve the water system.
“We think the video will help the public understand how rates are set through the CPUC’s transparent process. The independent review and approval of operating costs and investment needs help ensure that our water utility systems are properly upgraded and maintained for reliable service today and into the future,” Hawks said.