Why Your Water Bill Is Rising

This story is part of our new reporting series that explores the different pressures affecting cost of living for San Diegans. View more stories here.

Two things are true about the cost of water in San Diego: the cost of bringing water here and maintaining the system that does it is rising, but the amount of water San Diegans consume is dropping. 

In 1990, the average San Diegan used 235 gallons of drinkable water per day, according to the Water Authority’s records. By 2021, San Diegans cut that almost in half to 130 gallons per day. Megadroughts that triggered mandatory water cutbacks triggered better water conservation habits, which stuck. 

But while San Diegans are using less, the costs they pay continue to rise. The cost of San Digeo’s water supply is expected to rise anywhere from 5.5 to 10 percent beginning in 2023, with hefty hikes continuing in the years thereafter. 

“Long after I’m dust, these supplies will be valuable to this region,” said Gary Arant, who leads the Valley Center Municipal Water District, of the haul of water rights San Diego has locked up. “Right now, we’ve got a lot of water. It’s expensive, but I think the decisions we made were good.” 

The price San Diegans ultimately pay for water on monthly bill results from a chain reaction of costs that begins with getting the water from the Colorado River or a desalination plant in Carlsbad. San Diego used to get its water from one source: the Los Angeles-based Metropolitan Water Authority or Met. 

But when a huge drought in the 1990s led to major mandatory water cuts statewide, San Diego decided relying on one water supplier wasn’t such a good idea. That’s when San Diego became hellbent on diversifying its water supplies, striking huge (and expensive) deals with others that held rights to Colorado River water beyond Los Angeles, building storage reservoirs and even a plant to turn ocean water into drinking water – a newfangled and costly technology.  
All those investments paid off during this latest drought. While San Diego was sitting on plenty of water, much of northern California — with its abundant lakes, rivers, rain and streams — discovered its historic reliance on surface water is less predictable in the face of a changing climate. Still, all of San Diego’s investments came at a hefty price for generations to come.  

It’s notoriously difficult to fairly compare how the cost of that supply affects parts of San Diego differently. The Water Authority said it doesn’t track water rates among its 24 water district customers. But when the Water Authority raises rates, the increase falls differently between the 24 smaller water districts that buy from it.  

For instance, a 3.6 percent bump in prices that the Water Authority charges for its wholesale water in 2022 triggered a 7 percent bump for customers in the Olivenhain Municipal Water District, which serves an area from Carlsbad to Interstate15, Fairbanks Ranch and Cardiff. For those in the city of San Diego, the average bill will be about $90 a month in 2022, versus the $77 per month those customers paid in 2017, a nearly 17 percent increase in out-of-pocket costs in just five years, according to a survey of water bills by the Otay Water District.  

One way to look at what’s causing the water price shock is to understand how the Water Authority charges for its different water sources, and other fees for building all the stuff that’s kept the region quenched during the most recent drought.  

The Colorado River 

About 66 percent of the region’s drinking water still comes from the Colorado River. About 11 percent of that is shipped south straight from the Los Angeles-based Metropolitan Water Authority, which controls most of San Diego’s access to the Colorado River. But Met charges the Water Authority for use of its system of pipes to get Colorado River from elsewhere, too.  Met, as it’s called, proposed a 16 percent increase in the price of water through 2024. That means for roughly two thirds of its water, the San Diego region is going to be paying more than it’s paying now. 

In 2016, Met charged $594 per acre foot for untreated water and $942 per acre foot for treated water. An acre foot is enough water to cover an acre of land one foot deep. Those costs went up to $799 and $1,143 per acre foot respectively in January of 2022, according to the Water Authority’s bond documents.  

That’s a spike of 34 percent for untreated water and 21 percent for treated water.  

Imperial Irrigation District  

San Diego fought to control the price on another larger portion of Colorado River water owned by Imperial Valley. That farming region has a legal claim, through the byzantine world of water rights, to huge amounts of Colorado River water. Whatever water it doesn’t need, it can sell to other regions that don’t have the same claim. 

Through a long-fought contract, San Diego got almost 39 percent of its water in 2021 from the Imperial Irrigation District. In practice, San Diego basically pays farmers to conserve, and send some of their water west.  

This water cost in 2021 is $1,223 per acre foot including a charge levied by Met to carry the water in its pipes. In 2016, that price was $1,069 per acre foot, a 5 percent increase.  

San Diego gets another chunk of water from a big canal that also sends Colorado River water west, called the All-American Canal. San Diego paid to line that canal, which helped reduce the amount of water that would otherwise seep through the infrastructure into the ground. San Diego gets to collect that saved water. About 16 percent of San Diego’s water supply came from the canal in 2021.  

This water in 2021 cost $550 per acre foot to help maintain and operate the canal, a 21 percent increase from the cost of that water in 2016. 

Carlsbad Desalination Plant 

The region gets about 8 percent of its supply from a plant that cleans ocean water to drinking water standards. It’s the most expensive water San Diego uses, while the Colorado river water we get from Los Angeles is one of the cheapest.  

The costs of desalinated water have been on the rise since it was built in 2016. The first batch of water that year cost $2,123 per acre foot. An average California household uses between a half and one acre-foot of water per year for both indoor and outdoor use, according to the Water Education Foundation.  

In 2021, the Water Authority paid $2,588 for that water. That’s a 22 percent increase.  

Those three main big buckets of water San Diego pays for are just the cost of the supply itself. The Water Authority still has a massive network of pipelines, pumps, treatment plants, dams and reservoirs to maintain – which costs money – plus it has $2 billion in debt it’s paying off from building it.  

The Water Authority predicts that water demand will steadily rise as long as the regional population does as well. But some of the 24 member agencies disagree saying their own water use shows demand is dropping. The Water Authority’s Urban Water Management Plan showed that though drinking water demand in 2020 was around 619,000 acre feet, total consumption was actually about 458,000 acre feet, about 35 percent below the predicted demand. 

But the costs for paying for the infrastructure, both maintenance and debt, doesn’t go away, even if people use less water. Those costs are charged to the 24 different water districts through a series of other fees or charges.  

The Water Authority charges fees, based on how much water each agency uses, for transporting the water, for storing water in case of emergency like an earthquake, to cover the costs of the desalination plant and the Imperial Valley contract, and the Water Authority’s administrative expenses called the “customer service charge.” It also charges a flat rate for every water meter in each district. That’s the main “fixed” charge the Water Authority collects and it was imposed in 1998 to ensure the agency had a reliable source of funding. Revenue from the other fees is dependent on how much water the region consumes, which has been on a downward trend in terms of individual customer consumption. 

Charge for the Amount of Water We Drink or the Cost to get it Here? 

As water sales and revenues drop, the Water Authority is studying whether it needs to make a dramatic shift in how it charges cities for water in the future. Arant, who runs Valley Center Municipal Water District, serves on a finance board at the Water Authority and thinks the agency should stop charging for water based mostly on consumption.  

That’s in part because some big water users in the region are starting to recycle their wastewater into drinking water, like the City of San Diego which is one of the Water Authority’s biggest customers.  

Once that happens, and if the way the region pays for water stays the same, that means water districts in smaller cities will have to pick up more of the tab left unpaid by the city of San Diego’s reduced consumption. 

“We’ll never produce enough wastewater that we can reclaim, so we are 100 percent reliable on the Water Authority,” Arant said, of his small district’s ability to support itself.  

The Water Authority spent $568 million to raise the walls of the San Vicente Dam 117 feet so it could store more water for emergencies. It’s part of an approximately $1.5 billion so-called Emergency Storage Project, which also added storage at Lake Hodges and the Olivenhain Reservoir. These large bowls in the Earth are where we store that Colorado River water. 

It’s a system that any city in the region would benefit from should a huge natural disaster cut off supplies from the Colorado River or other sources to the region. Cities are paying for that now, to the tune of several hundred thousand dollars per month for some cities.  

“You can’t just be sitting there, not paying for your share of the Water Authority, and all of a sudden, something happens and you need the Water Authority to be there,” Arant said.  

The cost of water imported from the Colorado River has tripled since 2000, said Amy Doran, the city of San Diego’s assistant director for the Pure Water wastewater recycling project.  

“We anticipate producing water locally is overall projected to be less expensive than imported water,” Doran said.  
 
Sandy Kerl, general manager of the Water Authority, said the agency is trying to lobby both the state and federal governments for funding to support the growing infrastructure costs in the region, especially for old and aging pipelines some of which were first laid in the ground in the early 1900s.  

“It used to be that water infrastructure was paid, basically 70 to 80 percent, by state and federal grants and the rest was paid by ratepayers,” Kerl said. “Today that’s flipped.”  

Last year, the state granted the Water Authority just under $25 million to help pay off the huge debt from unpaid water bills incurred during the COVID-19 pandemic.  

But the Water Authority said it still has about $10 million in unpaid water bills from both residential and commercial customers that need additional support.