Thursday, May 8, 2008

Does Conservation Increase Costs?

Alarming news out of Atlanta, GA today suggests conservation leads to higher prices.

You may remember last fall when news circulated that the southeast portion of the United States was under heavy drought conditions. This resulted in an extreme water shortage. Georgia residents, specifically, were urged to do everything they could to conserve water. Georgia went so far in their efforts to conserve water that they made watering your yard after a certain point in the morning a crime.

Georgians responded well and began conserving water. In fact, they were able to reduce their water usage by as much as 30%.

Georgians conservation efforts are coming at a cost, however. The public water system says that they can not continue to operate with the lost revenue that is occurring because of conservation. So they went before Atlanta city council and requested a rate hike, which was approved 6-0.

Georgians will see their water bill increase by 15% this year. Over the next four years their water bills will continue to increase, bring the total increased cost for water to 80%. A water customer now pays an average of $59 per month, in 2012 they will be paying an average of $152 per month.

This is an alarming indicator. Would consumers see a similar increase in the costs of gasoline should we be able to reduce consumption by 30%? Imagine paying $3.45 now, but in four years having to pay $6.21 a gallon simply because your car went from getting 24 miles per gallon to 31.2.

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