There are three areas that utilities should address in
order to improve their financial strength: financial
planning and management, effective pricing, and
affordability. This article discusses these areas, as well
as their benefit and importance in encouraging effective
planning and preparation for utilities to meet
future challenges. First, financial planning and management
involve an iterative process through which
strategic business planning, capital planning, and
financial planning are considered. Second, effective
pricing is a key component to help utilities realize their
goals and objectives through an equitable rate structure.
Third, affordability and factors affecting the
affordability of water and wastewater service offer
insights into circumstances and limitations that may
affect the revenue-earning potential of utilities. By
addressing these areas, utilities are further enhancing
their financial strength.
With water rates increasing at a rate nearly twice
that of the consumer price index, affordability is
becoming an increasingly important, as well as challenging,
issue. The steady upward climb of water
rates, and the associated challenges that will likely
come with this trend, will make sound financial planning
one of the more important issues to be faced by
utilities in the coming decade. Includes reference, table, figures.
| Edition : | Vol. 97 - No. 4 |
| File Size : | 1
file
, 450 KB |
| Note : | This product is unavailable in Ukraine, Russia, Belarus |
| Number of Pages : | 10 |
| Published : | 04/01/2005 |
