Wholesale Cost Aspects of Water Supply

Abstract

This article discusses the wholesale cost of water, defined as the cost of developing and bringing an adequate supply of potable water to an area of use. It includes the cost of studies to determine available supplies of surface and groundwater, the construction of physical works such as dams, aqueducts, pipelines, pumping plants and storage facilities, right of way, financing, and operation and maintenance after completion of construction. The article presents the California Water Project as an example of determining the wholesale costs of water for a surface water supply system. The article also discusses how the water project was planned, its service areas defined, costs estimated, and arrangements made for financing and for repayment of costs. This example represents a minimum of federal subsidy and a maximum of cost repayment with interest.