Two of the fundamental principles of setting rates for public utilities are that rates should be based on the cost of providing service, and there should be no discrimination between different customers. These rules prevent one or more customers or classes of customers from subsidizing the costs incurred by the utility to provide service to other customers. If the total costs of a utility are seen as a fixed pie, these rules prevent one customer from having to pay for portions of the pie eaten by another customer.
Yesterday the California Public Utilities Commission (CPUC) adopted Resolution W-5000, which requires all investor-owned water utilities in the state to provide notice to their customers of the mandatory water conservation measures adopted by the State Water Resources Control Board (SWRCB) in its emergency regulations that became effective on July 28, 2014. The CPUC had required all Class A and B water utilities within its jurisdiction to activate Tariff Rule 14.1 calling for voluntary reductions in water use on February 28, 2014, in Resolution W-4976. Resolution W-5000 imposes further requirements.
The District Court for Larimer County, Colorado has struck down a voter-approved ordinance of the City of Fort Collins that adopted a five-year moratorium on hydraulic fracturing. The ordinance was passed at the general election on November 5, 2013 and challenged by the Colorado Oil and Gas Association (COGA). The court issued an Order granting COGA’s motion for summary judgment on August 7, 2014.
There has been no shortage of news articles on the California drought this year. Many have helped inform the public about critical issues related to the conservation and development of water resources in the state, and about changes or potential changes in the laws and regulations concerning urban water use and groundwater. There have also been a number that focus on the existence of and increased activity in a market for water rights and supplies, including this article from today in Bloomberg.
On January 27, 2014, Governor Brown released a California Water Action Plan (CWAP) to address the ongoing drought and long-term challenges such as environmental protection, population growth and climate change. While the document was released several months ago, the implementation actions are only now starting to be clarified, especially regarding groundwater. This post reviews that document and evaluates the various actions identified in the CWAP from the perspective of a legal practitioner.
The Arizona Department of Water Resources (ADWR) has published a new report entitled Arizona’s Next Century: A Strategic Vision for Water Supply Sustainability (2014). This ambitious report examines the historical and future management of water supplies and demands in Arizona and 22 planning areas within the state. It concludes that Arizona faces a water supply deficit of approximately 900,000 acre-feet in the next 25 to 50 years, which is a significant gap to close.