Current laws and regulations governing water quality restrict water utilities' ability to modify operations to address climate change-related challenges. However, in the years ahead, the industry most likely will face new regulations governing greenhouse gas (GHG) emissions. To help public policy makers, water utility managers and other interested parties understand the current constraints and opportunities for adaptation, the Water Research Foundation (WaterRF) has just released “Building a Climate-Ready Regulatory System” (Project 4239) and the companion document “Executive White Paper and Action Plan.” This project was supported and funded in part by the American Water Works Association (AWWA).

The report examines the major federal legislation and regulation governing water utilities to identify where they reduce a utility's ability to adapt to climate change and reduce GHG emissions cost-effectively. It then overlays potential and pending climate change and water quality legislation and regulations at the state, regional, and federal levels. Finally, it identifies opportunities for policy changes that would allow utilities to balance reducing their carbon footprint with drinking water standards and regulations, water supply demands and other social and financial goals.

“In the next few years, the U.S. water supply industry will face one of the most complex simultaneous compliance challenges: increasingly strict water quality standards coupled with climate change and, specifically, greenhouse gas emissions controls,” said Rob Renner, WaterRF executive director. “Since climate change policies will introduce new regulatory challenges to many facets of water utility operations, they represent a challenge of unparalleled scope and complexity. The Foundation's Climate Change Strategic Initiative funded extensive research to give utility managers insights into the implications of climate change. 'Building a Climate-Ready Regulatory System' is a key element of that effort.”

Among the report's conclusions were:

  • The next decade is an opportune time to enact policy changes before the physical pressures of climate change cause major problems.
  • Existing laws give the EPA and other federal agencies opportunities to invigorate statutory language that could greatly assist water utilities in adapting to changing climate conditions.
  • EPA plans several new national drinking water standards that are opportunities to incorporate climate-ready regulatory principles into its program.
  • For the next decade, GHG emission regulations will almost exclusively affect water utilities through higher electricity prices. When GHG emission regulation of electric utilities is coupled with other environmental regulations facing that sector, real electricity prices will rise during the decade by at least 10 percent over the levels set by the widelyfluctuating energy markets.
  • The new electricity market includes solar credits, efficiency incentives, tax rebates for some renewables, subsidized loans for other renewables, billing fees, and many more offerings. Entering the new energy marketplace is a primary way for water utilities to reduce their energy costs.
  • As climate change regulation unfolds, water utilities can best prepare by understanding their energy use, prepare for rising electricity prices, and analyze the market for incentives created by federal, state, and regional policies.
  • Energy efficiency is emerging as the most likely GHG emission technology/technique that practically fits the Clean Air Act's technology-based regulatory standards-and one that would benefit water utilities. However, increasingly stringent water quality regulations create significant challenges for improving water utility energy efficiency.
  • With the prospects of comprehensive federal climate change legislation highly unlikely for the foreseeable future, climate change policies will explicitly be energy policy. Energy legislation and climate change legislation have similar impacts for water utilities.
  • Regional and state programs are testing the federal legislative proposals.
  • International experience so far confirms the U.S. analysis. Water utilities in other countries are experiencing higher electricity prices due to GHG emission control regulations of the power sector.

The full report and the white paper and action plan are available to the public and can be downloaded from the Foundation's website. The foundation also maintains the Climate Change Clearinghouse which contains an extensive collection of resources about climate change impacts on utility operations and what can be done to prevent, limit and manage them.

“This report lays out the steps that public policy makers and water utilities can take now to help ensure the continued availability of adequate supplies of safe, affordable drinking water well into the future,” concluded Renner.