Working with a manufacturing client in Omaha who's considering relocating to an area served by a Municipal Utility District instead of Metropolitan Utilities District. They use about 850,000 gallons per month. Current MUD rate is $2.47 per 1000 gallons after the first 300,000. The private water company is quoting $1.98 per 1000 but has a $340 monthly service charge. Anyone have experience comparing these rate structures for high-usage customers?
MUD vs Private Water - Rate Structure Comparison Needed
Greg - make sure you're comparing apples to apples. Private water companies often have seasonal rate adjustments and peak demand charges that MUDs don't use. Also check if that $1.98 rate includes all fees and surcharges. I've seen Pennsylvania American Water quote low base rates then hit customers with infrastructure improvement charges, fire protection fees, and system benefit charges that add $0.50+ per 1000 gallons.
In Missouri, our private water companies typically have much higher connection fees and capacity charges for new industrial customers. Missouri American Water charged one of my clients $18,000 just to increase service from 2-inch to 4-inch meter. The municipal districts usually handle upgrades at cost. Don't forget to factor in the one-time costs of switching service.
Also consider reliability and service quality differences. Down here in Alabama, I've found municipal water districts generally have better response times for service issues but private companies often have more sophisticated billing systems and usage monitoring. For an 850k gallon per month customer, you want someone who can provide detailed usage analytics to help optimize consumption patterns.
Greg, one thing to watch out for - many private water companies have "take or pay" minimums for large commercial accounts. United Water here in Idaho required a 500,000 gallon monthly minimum for one industrial client even during seasonal shutdowns. That could wipe out any per-unit savings if your client has variable production schedules. Make sure you understand the minimum billing requirements before they commit.