It's been an exciting week here at MPC. Last Tuesday we released Immeasurable Loss: Modernizing Lake Michigan Water Use, which details research findings and policy recommendations in support of the Ill. Dept. of Natural Resources' efforts to improve water resources management in northeastern Illinois. We kicked off advocacy in support of those policy proposals, and that's reaped immediate benefits with substantial media coverage of a heretofore out of sight, out of mind, issue. And we held a lunchtime roundtable—attended by 76 elected officials, water resource managers, and industry leaders—to discuss the issue of modernizing the usage conditions tied to Lake Michigan permits, why it needs to happen, and what some of the challenges might be along the way. By all accounts the roundtable, which was made possible with sponsorship from Illinois American Water, was a success and got us off on the right foot. Missed the event? Check out the streaming video at your leisure.
A quick recap: I led off with an overview of Immeasurable Loss, and I'll paraphrase from it here: Every day tens of millions of gallons of Lake Michigan water are lost due to leaks, faulty meters or accounting errors, never producing any revenue. Water also goes to waste through inefficient plumbing and excessive outdoor use. Both lost water—which costs money to produce—and wasted water—which was paid for but used unproductively—are a financial burden. Fortunately, the factors that lead to loss and waste are controllable, and the problem is solvable. We know our region is losing vast sums of Lake Michigan water, and we know this inefficiency is costing us money, but we don’t have a clear picture of how much water or how much money we are wasting.
The best available data suggest the problem is large—approximately 70 million gallons a day in water loss alone—but the method of calculating that figure is suspect. The conditions of use Illinois has long attached to Lake Michigan water permits do not capture data that would identify the causes of loss and solutions to prevent it, nor is data collected adequate to guide utilities to adopt best practices for water resources management. The accounting methodology attached to those permits is simply out-of-date; to prompt more efficient and cost-effective water resources management, Illinois should modernize this process. Other permit conditions influence how local water utilities manage rate setting, metering, plumbing and outdoor usage—and these are equally in need of modernization.
Fortunately, in early 2013, the Ill. Dept. of Natural Resources (IDNR)—which manages the permits and usage conditions described above—began circulating a proposed series of modernization measures. MPC supports the majority of those measures; Immeasurable Loss describes why they are necessary, how the region will benefit and areas where we believe IDNR should revise its proposals. In the report, and in my presentation, we addressed five areas of the permitting system for improvements:
- Improve the existing accounting system, while exploring a new approach
- Encourage communities to set water rates based on cost and use comprehensive metering
- Require permittees to adopt modern plumbing standards
- Strengthen and streamline outdoor water use standards
- Increase the capacity of IDNR’s Office of Water Resources to provide adequate support to permittees
The rest of panel was comprised of Daniel Injerd, IDNR's lead on Lake Michigan management; Michael Smyth, Illinois American Water (which also generously sponsored the event); and Mike Ramsay, the Village of Westmont's Water Superintendent. All the presentations are also available for review.
Dan's core message was that while the permitting conditions have not changed much since about 1980, a lot has changed in the world of water resources management, and so the permit conditions need to evolve as a result. Water rates are higher, so the value of lost water is greater. Leaks are easier to find and repair, so allowances for water loss based on the age of pipes no longer makes sense. Plumbing fixtures have changed, and so too should local plumbing codes. IDNR's proposals, the current iteration of which is out for public comment until May 31, are pragmatic responses to changes in the way we manage water, and as our paper explains, MPC supports the majority of the current proposals.
As Michael explained, Illinois American Water largely supports the proposals as well, though they differ with IDNR on the timeframe for implementation of a few things, most notably when permittees will need to be in compliance with the revised standards on unaccounted-for-flow. The bulk of Michael's presentation was about the benefit of full-cost pricing for ensuring sufficient revenue to pay for operations, maintenance and investment. Cost accounting procedures and rate setting vary greatly between Lake Michigan users, so while MPC also supports a shift to full-cost pricing, we also believe that IDNR should play a larger role in creating templates and/or standardized procedures on how to assess costs and develop rate structures to meet them.
Finally, Mike's story of Westmont coming to terms with its water loss, its revenue shortfalls, and its need for infrastructure reinvestment was matter-of-factly inspiring. Westmont came to terms with the fact that its water rates did not generate enough revenue to fund main replacements and other maintenance projects to keep water loss (and thus lost money) under control. So they fixed it through a combination of rate adjustments, repairs and conservation programs. Of course, with utility management nothing is every truly fixed, because everything requires maintenance, monitoring, and investment.
That's at the heart of IDNR's proposals and Immeasurable Loss. Our region's management of Lake Michigan has improved, but that doesn't mean it's good enough. We can reduce loss even further, we can shave off peaks in summertime demand, we can manage costs and rates more sustainably, and we can ensure water availability for future economic development (and perhaps relief for some groundwater communities), and we should do all of those things. Most people in water resources in the region agree with the rationale behind what IDNR is proposing, and most of the differences of opinion are rooted in how those proposal would be implemented. That can all be resolved, and perhaps that process of negotiation between IDNR and its permittees will set a standard for the future.
In the meantime, review IDNR's proposals, check out Immeasurable Loss, and let us know what you think!