Our Water

The cost of water: Where you live makes a difference

Where you live has a lot to do not only with the abundance of water but what you pay for it.

Private utilities charge 50 percent more on average than municipal systems for the same water and sewer service, the North Carolina League of Municipalities and UNC’s Environmental Finance Center reported in a February rate survey.

Live outside the city limits? Municipal rates are likely to cost 75 percent more than in town.

Comparing rates is tricky. Most local elected boards want to keep rates as low as possible, but one utility may invest in advanced meters or leak-detection devices while its neighbor puts off routine maintenance.

“It doesn’t mean that it just naturally costs less for one of them to produce water,” said Jeff Hughes, the center’s director. “It’s how far do you want to go to be proactive?”

Clean Water for North Carolina, an advocacy group, says private water companies don’t get the scrutiny that public utilities do. Aqua North Carolina and Utilities Inc. are the largest of the companies that serve suburban and rural subdivisions and mobile home parks.

“The whole system allows for very high rates and very little oversight that results in customers paying twice as much as customers in the city,” said associate director Katie Hicks.

State officials say private companies charge more, in part, because their systems are typically smaller and less efficient than public ones.

Legislators made the situation worse in 2013, she said. They approved a provision that lets companies pass capital costs to customers without waiting for general rate cases – or public hearings.

Companies say the provision encourages them to upgrade their systems, benefiting customers, because they can quickly recoup their investments.

Attorney General Roy Cooper challenged a 2014 rate case in which the state Utility Commission allowed Aqua to use the provision. The state Supreme Court upheld the commission in August, but noted testimony by 30 customers of discolored water and sediment.

Aqua North Carolina president Tom Roberts said naturally occurring iron and manganese cause the problems, which aren’t considered health threats. He said Aqua will spend $5 million to $7 million, passed in surcharges to customers, to fix the problems.

Bruce Henderson

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