Denver Water sets course for 2014

Denver Water plans to rehabilitate Antero Dam in 2014
Denver Water plans to rehabilitate Antero Dam in 2014

From Denver Water:

Like utilities across the nation, Denver Water faces the challenge of staying on top of maintenance for its aging system — some of which was built more than 100 years ago — to ensure area residents continue to receive high-quality water and reliable service year-round, 24 hours a day, 7 days a week.

At its meeting today, the Denver Board of Water Commissioners adopted a budget and rate changes to fund essential repairs and upgrades in 2014.

The 2014 budget is $371 million, which will fund a number of multi-year projects, such as replacing aging pipes and failing underground storage tanks, upgrading water treatment facilities to maintain water quality and meet new regulatory requirements, and rehabilitating Antero Dam. The budget is funded by water rates, bond sales, cash reserves, hydropower sales and fees for new service (tap fees).

Effective January 2014, the budget calls for a rate increase of $1.29 per month on average for Denver residential customers and full-service suburban residential customers using 115,000 gallons annually (the average annual consumption for Denver Water’s service area). The amounts will vary depending upon customer water usage and whether the customer lives in Denver or is served by a suburban distributor under contract with Denver Water. Customers in Denver tend to use less than 115,000 gallons per year; suburban customers tend to use more.

“We continue to prepare for Colorado’s increasingly extreme and unpredictable weather cycles, which require us to do all we can to make sure our system is even more resilient,” said Jim Lochhead, CEO/manager of Denver Water. “In response to the dry conditions earlier this year, we prepared financially by reducing our 2013 operating expenses, deferring projects and tapping into our cash reserves to help reduce our costs and balance our finances.”

“We adjust our budget and corresponding water rates each fall for the following year after we examine the necessary projects needed to maintain and upgrade our system.”

Denver Water operates and maintains more than 3,000 miles of distribution pipe — enough to stretch from Los Angeles to New York — as well as 19 raw water reservoirs, 22 pump stations and four treatment plants.

“Denver Water’s collection system covers more than 4,000 square miles, and we operate facilities in 13 counties in Colorado,” said Lochhead. “It takes an extensive network of pipes, pump stations, treatment plants, people and more to make sure our customers can turn on the tap and enjoy fresh, clean, safe water every day. We must continue to invest in that system to ensure a secure water supply for the future.”

Under the 2014 budget, rates for Denver Water customers living inside the city would remain among the lowest in the metro area, while rates for Denver Water residential customers in the suburbs would still fall at or below the median among area water providers.

The water department is a public agency funded by water rates and new tap fees, not taxes. Water rates are designed to recover the costs of providing water service — including maintenance of distribution pipes, reservoirs, pump stations and treatment plants — and also encourage efficiency by charging higher prices for increased water use. Most of Denver Water’s annual costs are fixed and do not vary with the amount of water sold.

Leave a Reply