Conservation RatesAmerican Water is also working with state utility commissions to encourage water conservation through a tiered rate structure, particularly in water-stressed states. Tiered rates are designed to reduce water use. Also called conservation rates, tiered rates give customers more control over their water bill—high-water-using customers pay a higher rate for each unit (748 gallons) of water, and low-water-using customers pay a lower rate per unit. Conservation rates do not result in an overall revenue increase to American Water, but they do reallocate the cost of water. High water users can realize a larger water bill while low users will likely see a reduced bill. In short, the less water that customers use, the more they save. The two graphics below illustrate how usage can affect rates.
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