Wholesale Water Rates to Rise, But Less Sharply, After Water Authority Board Vote

Federal grant funds, a water transfer and budget cuts helped minimize wholesale water-rate increases for 2025 despite inflation and climate impacts that are pushing prices higher.

The San Diego County Water Authority’s Board of Directors on Thursday approved a total increase of 14% in wholesale water rates for next year, while directing a one-year delay on a $7 million capital project and $2 million in additional cuts to the agency’s operating budget.

That rate combines the board-approved increase in June that covered rising prices from the Metropolitan Water District of Southern California with an additional increase to pay for other water supplies, along with financial and infrastructure needs.

Mayor Todd Gloria, a critic of the proposed rate increase – which he said had ranged from 18 to 24.5% – noted the adjustment in a news release, crediting board members with pushing for a less burdensome change.

“Today, thanks to the effective leadership of the city of San Diego’s representatives on the water authority along with representatives from other local water agencies – who persuaded Water Authority staff to find cost-saving efficiencies and further reduce the necessary increase – we were able to bring it down to 14%,” he said. “This means less money coming out of the pockets of ratepayers.”

Every customer will feel the impact differently, based on their water use and how local retail water agencies handle costs.

During a months-long public process that included two public hearings, the authority cut

initial rate increase projections in half (for report, see water authority memo, beginning on page 5).

That work included a decision by the board to apply approximately $19.4 million in new federal grant money to lower 2025 rates. In addition, a pilot program allows retail water agencies to trim about 1.5 percentage points from next year’s bill by prepaying fixed costs.

For participating agencies, this will reduce the 2025 effective rate increase from 14% to 12.5%.