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Affordability Information (Lifeline Rates)
Pricing discussions must always involve considerations of equity as well as efficiency. Low-income households, especially those served by high-cost systems, may face affordability problems if prices are raised. To alleviate these hardships, communities may offer pricing structures that mitigate impacts on low-income households. The most common example is "lifeline rates" whereby low-income households are charged lower rates on that portion of water consumption considered non-discretionary (the minimum sanitary requirement, e.g., 6,000 gallons a month) but then higher charges are levied on water consumption beyond that amount. The American Water Works Association Research Foundation has the most complete information on water affordability programs.
In recent negotiations with the District of Columbia Water and Sewer Authority, EPA Region III has looked into the issue of affordability and prepared a paper on "Rate Options to Address Affordability Concerns for Consideration by the District of Columbia Water and Sewer Authority" . Although written specifically for the District of Columbia, the general concepts apply throughout the United States.
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