What seems a good thing – water levels at the highest capacity they’ve been in years – is actually not so great for Colorado Springs Utilities.
The one drawback of so much rain is that customers use less water, which means the utility loses revenue.
Fifty percent of the money made by the water utility in Colorado Springs comes from irrigation, and now the utility is down $17 million due to the water farmers have not needed to use.
Water Online reports:
“In Pueblo, the water revenue is down about $2.5 million. The Pueblo Board of Water Works is finding other ways to make up for the loss,” the report continued.
Colorado Springs Utilities Chief Financial Officer Bill Cherrier explained that the toll on revenue means some infrastructure work may need to be postponed.
“In future years, if we’re not able to keep up on all that preventative work, we would likely see more increases in main breaks, other water issues, infrastructure,” he said, per KRDO.
During the rainy weather, Colorado Springs shut down some of its intermountain pumping stations, according to Abby Ortega, Water Supply Planning Supervisor for Colorado Springs Utilities.
“We’re not even pumping into Rampart at this point,” Ortega said, per KOAA. “We shut off on Mother’s Day weekend and have not turned Otero Pump Station back on which is very unusual for the water supply.”
On a more positive note, the utility does expect to fill most of its reservoirs to capacity this year, which is very encouraging and will leave the situation in good stead for the next two years at least.
It is interesting to see that both drought and higher than expected rainfall can have reasonable size impacts on a water utility revenue.
If revenue is much below forecasts, then this will have subsequent impacts on the amount of money available for operations, maintenance, renewal and in some cases new capital expenditure.
There are always two sides to infrastructure asset management financial projections – the long-term expenditure projections, and the long-term revenue projections.
Ultimately, in most jurisdictions, long-term expenditure and revenue have to balance up to allow sustainable delivery of the required services.
So, potential losses of revenue as a result of more extreme climatic events (drought or rainfall) needs to be considered by infrastructure asset managers.
What is the likely frequency of event cycles? What is the likely impact of expenditure and/or revenue? What strategies can be put in place to manage this?
This type of utility infrastructure management analysis can be included in the Future Demand and Risk Sections of your Asset Management Plan.
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