When LADWP’s water supplies are lower than normal, the Department must increase the amount of more expensive water purchased from the Metropolitan Water District (MWD). LADWP rates are designed so that MWD purchased water is covered by a pass-through factor on customer bills. In the past few years of the drought, the amount of MWD purchased water has been much higher than normal—averaging over 50% of L.A.’s water supply.
If drought conditions continue, a typical customer’s bill could increase more than estimated levels—from 2.7% to 2.9% annually, or an average of $3.75 to $4.02 on their monthly bill each year. A high-use customer’s bill could increase from a 5.6% annual increase during a normal year to 5.8% during a drought year. This represents a range of $16.58 to $17.17 more on their monthly bill over five years than at present rates.