Coupling conservation efforts with water rate structure: Evidence to inform leadership and support policy
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The purpose of this study was to identify data supported water rate structures that would promote sustainable agency revenue along with water conservation policy for long-term benefits to consumers and water agencies of Amador County in the face of increasing water scarcity. The theoretical foundation that provides the framework for this research is organizational change through sustainability (Doppelt, 2010) and requires leaders who understand the concept of sustainability and also have the skills to move change throughout the organization. The questions that the researcher addressed included which rate structures support agency revenue and which may encourage water conservation. A quantitative methodology was used to evaluate water consumption rates. This study focused on between-group differences of pre-existing groups of water consumers and is therefore casual-comparative in design. The data from three water use periods (pre-drought, drought, and post-drought) were analyzed using paired sample t-tests to determine if there was a statistically significant difference in revenue during those time periods. Random sampling selection of water users was appropriate and gave the researcher a good overview of resource consumption in various periods of conservation and non-conservation (Creswell, 2018). The data used for the paired sample t-tests did not show normality in all groups which was to be expected based on the variability in water demand among the consumer group. The p-values produced in the data analysis allowed the null hypotheses in two of the three tests to be rejected. Several factors were determined to effect normality of the data and are discussed in detail. The t-test for the pre-drought period showed that there was not a significant difference in revenue for the agency between the two different rate structures. The t-tests for both the drought period and the post-drought period showed a statistically significant difference in the revenue for the Amador Water Agency. The difference in revenue was actually lower under the consumption-based fixed rate model than the traditionally used rate structures. While many of the consumers in the study group decreased their water consumption during the drought period, they still saw an increase in their water utility bills because of the change to the rate structure implemented by Amador Water Agency. The water agency appeared to be able to maintain their revenue through rate increases during the study period, but these rate increases likely do nothing to encourage conservation behavior. The calculated consumption-based fixed rate structure showed that when consumers reduced their water usage, they also reduced their water bill and therefore warrants further research as a model for aligning conservation and revenue stability in the long-term. The information gained from the research will remain beneficial to the water agency in determining the best rate structure for their organization to sustain revenue throughout periods of variable water consumption, predict revenue and costs over drought and non-drought periods of consumption, and give an increased focus and effort to conserving the water resources of the area.