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California Incubates New Water Business Models

28 December 2016
Research Note

How will California’s drought and rising water rates impact water business models?

California has now moved into its sixth year of drought. As of December 2016, more than 42% of the state remains in extreme drought. This represents a 38% improvement over conditions recorded during this time last year. However, water stress looms large over utility, state, and local officials still seeking long-term policy solutions.

On 9 May 2016, the Governor signed an executive order to establish long-term water conservation measures requiring urban water suppliers to develop new, locally-focused water use targets to be achieved by 2025. Also, on 1 November 2016, the City of San Francisco mandated that all newly constructed buildings exceeding 250,000 ft² will be required to install onsite water reclamation systems.

Rising water rates are sparking greater interest in decentralized treatment systems that can be managed by third-parties. Will we see more third-party financing and ownership of systems in California? In this Research Note, Bluefield water experts analyze the status of California’s drought, San Francisco’s rising water rates, and changing business models.

This analysis is available to Bluefield clients through their annual Insight Service subscription. Contact us to learn more about becoming a Bluefield client.

Takeaways

  • Advanced water treatment solutions bolstered by declining water conservation numbers.
  • Reconciling conservation with utility business model.
  • San Francisco lays foundation for alternative water services model.

Companies Mentioned

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