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Performance contracting: A strategy to address water woes in the West

August 13, 2015 by Leave a Comment

DroughtPhotoWP

Photo by Anthony Quintano, via Flickr.

As raging wildfires, barren fields, and dried-up waterways continue to dominate the landscape of the American West, it’s abundantly clear that drought and water scarcity are critical issues that require immediate action.

While there’s no comprehensive solution to the current drought, organizations and individuals throughout the region are looking to use every possible strategy to mitigate the drought’s impacts.

McKinstry explored how using a simple yet innovative procurement mechanism—performance contracting—could quickly help address water conservation in the seven Colorado River Basin states (AZ, CA, CO, NM, NV, UT, WY). What we found was that schools and public governments in those states could save big.

The infographic below illustrates the significant savings potential.  Using performance contracting, public entities could save an enormous amount of both water and electricity, according to the study. site down . Perhaps the most impressive study finding was that these resource savings also came with big financial savings: $859 million per year.

WRAPic2

The performance contracting model is a smart approach for cities, counties, school districts, and wastewater/water utilities to implement energy and water efficiency improvements in their facilities. As you can see in the infographic below, performance contracting enables energy-saving capital projects that might otherwise prove to be prohibitively expensive.

WRAPic1

“Performance contracting is a powerful tool to address two of the Colorado River Basin’s most pressing needs: water conservation and energy savings,” said Leslie Larocque, director of McKinstry’s Rocky Mountain region. “We believe this approach can help public entities clear the financial hurdles to implementing important water and energy conservation efforts.”

Performance contracting also has the power to fund and introduce advanced water metering technologies for water providers and utilities in the West. Those technologies have the potential to help Western state utilities reduce water loss and create additional revenue streams.

These advanced water meters give real-time, accurate water usage and billing data. Advanced meter infrastructure systems collect and store readings in real time, allowing utilities to pinpoint leaks across the whole water distribution system. The benefits of installing this technology are numerous—data can illustrate water usage patterns, forecast demand, detect leaks, design and enforce municipal water conservation and drought plans, troubleshoot customer issues, and detect unauthorized water use.

Advanced meters also ensure that customers pay for their true water cost. Currently, many old meters are inaccurate—and most err on the side of under-accounting for real water use. We found that accurate meters can help water utilities in the Colorado River Basin states gain additional revenue of $593 million per year by ensuring they charge for all the water used.

Performance contracting may not be a drought panacea, but McKinstry firmly believes that—if implemented—it will be a step in the right direction for a region in dire need of water conservation.

To download a PDF of the study—“Tapping the Power of the Market”—that explores this topic in-depth, click here.

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Filed Under: Big Ideas, Home, Occupants & Operators, Technology Tagged With: Advanced Water Meters, Arizona, California, Colorado, Colorado River Basin, Drought, Energy, Energy Efficiency, Energy Savings, Nevada, New Mexico, Performance Contracting, Utah, Water Conservation, Wyoming

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