WATER METER FEASIBILITY STUDY

July 2007 Prepared By

CONSULTING ENGINEERS & ARCHITECT

Water Meter Feasibility Study Municipality of Red Lake

Page i

Table of Contents

1

INTRODUCTION..........................................................................................1 1.1

2

SUPPLY AND INSTALLATION COST ........................................................2 2.1

2.2 2.3 3

Effect of Meters on Consumption ....................................................12 Potential Water Use Reduction........................................................15

PROPOSED RATE STRUCTURE .............................................................20 4.1 4.2 4.3 4.4

4.5 5

Meter Equipment ...............................................................................2 2.1.1 Meter......................................................................................2 2.1.2 Encoder Register ...................................................................2 2.1.3 Data Interrogation and Recording ..........................................2 2.1.4 Software.................................................................................3 Estimated Costs ................................................................................3 Experience of Other Municipalities ....................................................6

FORECASTED BENEFITS........................................................................12 3.1 3.2

4

Study Objective .................................................................................1

Rate Structure Objective..................................................................20 Rate Structure Models.....................................................................20 Recommended Rate Structure Model..............................................23 Uniform Rate Structure Design........................................................23 4.4.1 Fixed Charge........................................................................23 4.4.2 Variable Charge ...................................................................25 4.4.3 Sample Residential Bill Calculation......................................26 Negotiated Contract Rates ..............................................................27

FUNDING OPPORTUNITIES.....................................................................28

APPENDIX ‘A’:

2007 Flat Rate Structure

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1

INTRODUCTION

1.1

Study Objective

Page 1

The Corporation of the Municipality of Red Lake currently does not meter customer water consumption. The implementation of metering customer water usage has been proven to be an effective way to reduce overall water consumption. The objective of the study is to investigate the cost of establishing a metering system within the Municipality and to identify the potential benefits attributable to metering consumer water usage. The study will also identify potential funding sources for the capital expenditure required to implement the metering program.

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2

SUPPLY AND INSTALLATION COST

2.1

Meter Equipment

Page 2

2.1.1 Meter The typical standard for a residential or commercial water meter is a positive displacement oscillating piston meter conforming to AWWA C-700. Market leaders in the supply of water meters for residential and commercial applications include Neptune Technology Group and Sensus Metering Systems. 2.1.2 Encoder Register To enable meter reading from outside the building the meter would be equipped with an encoder register (to AWWA C-702). There are varying levels of complexity available for acquiring the data from the encoder register. The basic encoder register (Option A) utilizes magnetic-field sensing technology to record the rotational positions of odometer wheel on the meter. High-end encoder registers (Option B) digitally encodes the rotation of the measuring chamber and transmit the data over a radio frequency. These high-end encoders do not require any external wiring (wireless) and therefore eliminate the need to drill holes through the building’s exterior wall envelope. Further upgrades to these types of systems will include leak detection, tamper detection, and reverse flow detection. 2.1.3 Data Interrogation and Recording The most common approach to acquiring water meter data is by using a touch read gun and portable data collector. The procedure consists of the meter reader touching the gun to the touch pad located on the exterior wall of each meter installation. The touch read gun transfers the meter data to the portable data collector. Communication between the touch read gun and the portable data collector can be achieved through a cable or by wireless communications. The portable data recorder is a handheld device used to collect and store the meter readings acquired in the field. The units will typically have a memory capacity to store meter readings and route information for more than 3,000 reads

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during a 6 to 8 hour reading day. At the conclusion of the day’s readings, the unit is placed in a communication/charging stand that is linked to the utility’s computer and the day’s reading activity is retrieved. As with the encoder registers there are varying levels of sophistication available for meter data interrogation and recording. Automatic meter reading systems utilize radio mobile data collectors to process over 70 readings per second. These systems can be linked to GIS mapping databases and are more suited to large municipalities with dense populations. 2.1.4 Software The meter reading operating software provides bi-directional communications from the computer to the communications/charging stand that connects to the portable data recorder. The software has report producing capabilities such as register malfunction, high/low readings, route notes, and non-read. The software will integrate with the Municipality’s Vadim utility billing software by creating an export file consisting of meter reading data. 2.2

Estimated Costs

Quotations from equipment suppliers and installers were obtained to determine the estimated cost of implementing the Municipal water metering system. Two options were considered: Option A

Touch Read Acquisition: The meters encoder register is hard wired to an externally mounted touchpad. To read the meter a touch read gun retrieves the meter data and transmits the data to the handheld data interrogator. Figure 1 shows the general layout for this system.

Option B

Walk-by Radio Frequency Acquisition: The meters encoder register is equipped with a radio frequency meter interface and the meter readings are transmitted directly to the handheld data interrogator as the meter reader walks the route. This system does not require the installation of any hardwiring from the meter to an external building

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location. Refer to Figure 2 for the general configuration of this system.

Figure 2 Option A – Touch Read Acquisition

Figure 2 Option B – Walk-by Radio Frequency Acquisition

A summary of the estimated costs is provided in Table 1.

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Table 1 Estimated Costs

Cost Description

Qty

Material Supply Residential Meter Supply 1,342 Commercial Meter Supply 159 Wiring Supply 34,790 No. of rolls @ 1000ft/roll 35 Installation Residential Meter Installation Commercial Meter Installation

1,342 159

Neptune Technology Group Option A Option B Unit Price Amount Unit Price Amount

$129 $173,118 $211 $33,549 $200

$7,000

$312 $418,704 $511 $81,249

$339 $460 n/a

$454,938 $73,140 n/a

$289 $392

$387,838 $62,328

Sensus Metering Systems Option A Option B Unit Price Amount Unit Price Amount

$108 $144,936 $211 $33,549 $200

$7,000

$325 $436,150 $365 $58,035

$228 $305,976 $331 $52,629 n/a

$1,000

$325 $436,150 $365 $58,035

Hardware and Software Auto Read Touch Guns, Handheld Data Recorders c/w Comm/Charge Stand and Software Training Software integration training by Vadim

4

$11,500

$46,000

$10,000

$40,000

$10,950

$43,800

$12,000

$48,000

1

$3,600

$3,600

$3,600

$3,600

$3,600

$3,600

$3,600

$3,600

Sub-Total (rounded) Contingency Allowance

$764,000 $76,400

$1,022,000 $102,200

$728,000 $72,800

$906,000 $90,600

Total Estimated Cost

$840,400

$1,124,200

$800,800

$996,600

Estimated time to required to install 1501 meters = 6 months.

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2.3

Page 6

Experience of Other Municipalities

Five municipalities in Northwestern Ontario were polled on their experience with meter reading options (A or B). The results of this polling are summarized in Table 2.

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Table 2 Experience of Other Municipalities Option A

Option B

Municipality Touch Read Acquisition

Sioux Lookout

Opinions Manufacturer

U

Walk-By Radio Acquisition

Meter

Neptune

• No complaints with meters to date. .

Touch Gun / Transmitter

• Handheld units are reliable, though batteries life occasionally is an issue. • Two units are recommended for times when batteries die.

Software

Winter Access

• HTE software is used, with service provided by Thunder Bay Hydro. • Reliable software with plentiful support. • Integrated HTE system utilizes central server in Thunder Bay connected to a fire walled local server from which the Municipality can access software billing services. • Integrates well with software that comes with meters.

• Bylaw was put in place to insure accessibility to meter in winter. Customers must keep snow clear around meter.

General Comments

• Municipality seems to be satisfied with system. However, they are looking to upgrading to RF.

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Table 2 Experience of Other Municipalities Option A

Option B

Municipality

Opinions Manufacturer

Touch Read Acquisition

Walk-By Radio Acquisition

U

Meter

Neptune

• Reliable and durable

Kenora

U

Neptune

• Reliable and durable

Touch Gun / Transmitter • Reliable units with good battery life.

• Reliable and durable units with minor repairs since 2001. Used to read meters of residences on islands.

Software

Winter Access

• HTE software is used, with service provided by Thunder Bay Hydro. • Reliable software with plentiful support. • Integrated HTE system utilizes central server in Thunder Bay connected to a fire walled local server from which the Municipality can access software billing services. • Integrates well with software that comes with meters.

• Usually no problems with snow since the meters are placed adjacent to Hydro meters for ease of access.

• Snow is not an issue with RF units, and there are no reported problems.

General Comments • There were some difficulties with installing the wire from the meter to the touch pad in finished basements.

• Municipality is looking to get more RF transmitters as well as more RF transmitting meters. • Municipality is pleased with their current system and praised Neptune’s product support and training.

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Table 2 Experience of Other Municipalities Option A

Option B

Municipality Touch Read Acquisition

Fort Frances

Opinions Manufacturer

U

Walk-By Radio Acquisition

Meter

Neptune

• Occasional report of faulty meter head. • Occasional difficulty encountered with wiring to exterior touch pad.

Touch Gun / Transmitter

• No complaints with interrogator units.

Software • HTE software is used, with service provided by Thunder Bay Hydro. • Reliable software with plentiful support. • Integrated HTE system utilizes central server in Thunder Bay connected to a fire walled local server from which the Municipality can access software billing services. • Integrates well with software that comes with meters.

Winter Access

General Comments

• Meters are hard to access in winter

• Current meter system in place is for commercial accounts only. • Municipality is considering upgrading to meters that read both hydro and water simultaneously.

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Table 2 Experience of Other Municipalities Option A

Option B

Municipality Touch Read Acquisition

Thunder Bay

Opinions Manufacturer

U

Walk-By Radio Acquisition

Meter

Sensus

• Reliable and durable.

Touch Gun / Transmitter

• Reliable and dependable units.

Software

• Vailtech software is used. • Integrates well with software that comes with meters.

Winter Access • City tries to install touch pads by driveways or sidewalks for ease of access in winter. • During the winter, if the touch pad is located in an inaccessible area, the customer is billed an estimated fee based off of past account history.

General Comments • Thunder Bay seems satisfied with current meter system in place. • Thunder Bay recommends that if a Municipality is installing meters for the first time that radio frequency be used for ease of use. More staff are involved with the touch read system.

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Table 2 Experience of Other Municipalities Option A

Option B

Municipality Touch Read Acquisition

Manitouwadge

Opinions Manufacturer

Walk-By Radio Acquisition

U

Neptune

Meter

Touch Gun / Transmitter

Software

• Reliable and durable. • Only maintenance so far is changing an occasional frost plate on those meters which are not installed in heated basements (example is a mobile home).

• Reliable and easy to use. Municipality currently only has one handheld unit.

• Asyst by USTI is used. • Integrates well with software that comes with meters.

Winter Access

• Snow is not an issue with RF units, and there are no reported problems.

General Comments • Public meetings and involvement are recommended for each step of implementation and planning. • Municipality confirms that the meters have encouraged conservation of water and noted that there is a reduction in manpower requirements due to use of the RF system. • Municipality is very satisfied with comprehensive training package and warranty work that comes with meters.

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3

FORECASTED BENEFITS

3.1

Effect of Meters on Consumption

One of the major effects that the implementation of water meters has on consumption is how much they can curb overall water usage. Environment Canada research1 has found that flat rate customers use 50 to 60 % more water than metered customers. The 1999 research by Environment Canada found that households paying for water by volume (i.e., metered) used about 288 litres per person per day. Canadian households paying a flat rate for water used 433 litres per person per day2. Figure 3 graphically illustrates the differences between metered and unmetered.

500

Daily residential water use (litres per person)

450 400 350 300 250

Unmetered

200 150 100

Metered

50 0 Price by volume

Flat rate

Figure 3: The Effect of Metering on Residential Use in Canada, 1999

Table 3 illustrates the differences in the average day and peak day demand for selected Canadian urban centres that are metered and un-metered.

1

Environment Canada: www.ec.gc.ca/water/en/manage/effic/e_meter.htm Municipal Water Use Database (MUD). Adapted by Indicators and Reporting Office, Environment Canada. 2

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Table 3 - Comparison of Demands in Metered and Un-metered Systems in Canada3 MUNICIPALITY METERED Chatham, ON London, ON Ottawa, ON South Peel, ON Edmonton, AB Average Metered (Rounded) UNMETERED Niagara Falls, ON Vancouver, BC Peterborough, ON Hamilton, ON Kamloops, BC Average Unmetered (Rounded)

DEMAND (Litres Per Capita Per Day) Average Day Maximum Day 510 475 555 485 480 500

1025 530 875 785 830 810

680 690 820 1055 820

1250 1525 1500 1570 2050

805

1555

The following outlines added benefits associated with the implementation of water meters. §

Customers who already practice water conservation in their homes may save money with the implementation of a water meter when it is compared to what they would have paid if they were on a flat rate.

§

Research indicates that customers become more conscientious of their water use when they have a meter, but they do not have to drastically alter their lifestyles. In fact, customers exhibiting average water use patterns may save money under a usage pay rate structure.

§

Metered customers pay for only the water that they use which makes it equitable for everyone. It gives customers the opportunity to be aware of the water they use and allows them to take steps towards better water management and conservation. Without meters, small families, especially seniors and those on fixed incomes who are on a flat rate schedule may end up subsidizing larger families and the commercial sector.

3

Adapted from the City of Calgary Water Conservation Study KEEWATIN-ASKI LTD. CONSULTING ENGINEERS & ARCHITECT

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§

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Saving water can help water quality because water saved is water that does not end up in the wastewater stream requiring treatment. This in turn reduces municipal pumping and treatment costs and frees up money that can be used for infrastructure renewal, rehabilitation, and replacement.

§

Having customers on meters will provide the municipality with much better information about water consumption patterns. This information allows the municipality to be more effective in planning facilities to meet demand, and reduce the amount of unaccounted for water (leakage) in the system.

§

Customers on a water meter are more efficient in their use of water for yard works and

Figure 4

irrigation. When tied to price increases, metered households generally show reductions in water use, with the greatest savings occurring during the summer months when use is much higher due to the

frequency of lawn watering, car washing, and other outdoor uses. For example, 1n 1991 the community of Port Elgin ON, (population 6,500) avoided a $5.5 million expansion of their water treatment plant by installing residential water meters and distributing water saving devices at a cost of $550,000. §

Customers can read their own meter regularly to get an idea of how much water has been used, then choose to incorporate water saving habits as required.

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3.2

Page 15

Potential Water Use Reduction

The impact of putting the water meter system into use will reduce water consumption habits within the Municipality. The level of reduction will depend on a number of varying factors and cannot be precisely determined until the metering program produces actual volume data. At this early stage of the implementation process a reasonable forecast of the potential water use reduction can be made with the results of national benchmarking studies such as those shown in Figure 1. These studies have focused on residential consumption which typically accounts for 90 percent of consumer metered flow. Flow records for 2006 were obtained from the flow database maintained by Northern Waterworks Inc. In order to make use of these records in determining potential residential water use reduction the flows must be adjusted to extrapolate the residential component. The flow records include unaccounted use of water resulting from leaks in the distribution system and plant operational losses. The flow records also do not differentiate between residential and non-residential usage. Table 4 presents the forecast of potential residential consumption reduction with a metered system using the adjusted 2006 flow records for the Municipality. Figure 5 provides a graphical representation of the forecasted reduction in residential usage.

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Table 4 Potential Residential Water Usage Reduction With A Metered System Flow – Cubic Meters x 103 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Total

Unmetered4

73

68

75

74

74

92

103

90

84

79

72

81

964

Metered Forecast

51

48

52

52

52

65

72

63

59

55

50

56

675

Forecast of Potential Usage Reduction

22

20

22

22

22

28

31

27

25

24

22

24

289

4

Adjusted 2006 flow records for the Municipality of Red Lake. KEEWATIN-ASKI LTD. CONSULTING ENGINEERS & ARCHITECT

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120

Flow Cubic Meters x 1000

100

UNMETERED

80

60

METERED 40

20

0 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Figure 5 Potential Residential Water Usage Reduction With A Metered System

Reduction during the summer months will likely be more pronounced than what is shown in Figure 5 as lawn watering is significantly influenced by volume based consumption charges. Of particular importance to the Municipality is the reduction of flows to the wastewater treatment plants. The wastewater treatment facilities are approaching capacity and decreases in the flows to the wastewater stream will help in lowering future capital expenditures for this component of the Municipality’s infrastructure system. Figures 6, 7 and 8 illustrate the potential reduction in wastewater flows to the treatment plants located in Red Lake, Balmertown and Cochenour (reductions in Madsen will also occur, however the reductions will not have a significant impact on wastewater treatment as the overall flows are low in Madsen).

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60

Flow Cubic Meters x 1000

50

UNMETERED 40

30

METERED

20

10

0 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Figure 6 Potential RED LAKE Residential Metered Reduction

60

Flow Cubic Meters x 1000

50

40

30

UNMETERED 20

METERED

10

0 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Figure 7 Potential BALMERTOWN Residential Metered Reduction

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60

Flow Cubic Meters x 1000

50

40

30

20

UNMETERED 10

METERED 0 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Figure 8 Potential COCHENOUR Residential Metered Reduction

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4

PROPOSED RATE STRUCTURE

4.1

Rate Structure Objective

Page 20

The short term objectives of the rate structure will be to meet the following criteria: §

Yield the necessary revenue for full cost recovery of operation and maintenance expenditures;

§

Minimize unexpected changes to customer bills;

§

Water conservation; and

§

Fairness and equity to all end users.

In the long-term the rate structure will need to employ the concept of selfsustainability in regards to generating revenue to recapitalize the various components of the water and sewer infrastructure system. The Municipality will be progressively moving towards self-sustainability. 4.2

Rate Structure Models

There are four (4) main rate structure models and these include: §

Flat Rate

§

Uniform Rate

§

Declining Block Rate; and

§

Increasing Block Rate.

Table 5 provides a summary of each of these models along with a review of the advantages and disadvantages.

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Table 5 Rate Structure Models - Advantages and Disadvantages

Rate Model Flat Rate: Primarily used for where service is provided on an unmetered basis. Customer classes define the various set rates charged. The Municipality currently uses the Flat Rate model.

Uniform Rate: A uniform rate is a rate structure where a constant unit price is used for all metered volumetric units of water consumed on a year round basis. As a customer uses more water, the bill increases at a steady rate per unit of consumption.

Disadvantage

Advantage

§ No incentive for customers to conserve water use. § Customer volume usage not collected. This data is an important utility management tool (per capita consumption, leak surveys, unauthorized water use). § Large volume customers may believe may request rate a reduction (declining block) or an alternative rate form. § The transition from a flat rate structure to a uniform rate may result in shortterm revenue instability. The reason for potential revenue instability is that although water use reductions can be anticipated, customer reactions to water rates can vary from customer class to customer class, as well as from community to community.

§ Customer billings do not fluctuate. § Billing process is uncomplicated and does not require meter reading.

§ Simplicity is the main advantage with uniform rates. Uniform rates are easily understood and implemented. Other utility functions, including cost analysis, and customer service are also simplified with less complex rate structures. § Uniform rates are considered equitable as customers pay the same unit cost for water service. § Uniform rates give service providers a level of revenue stability that is not normally associated with more complex rate structures. Assuming that there will not be future adverse conditions that may cause usage to fluctuate widely, uniform rates can provide a dependable revenue streams. § Uniform rates conserve water usage since customer bills vary with the level of water usage. § A uniform rate across all customer classes avoids the expense of detailed cost allocations.

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Rate Model Declining Block Rates: A declining block rate is a structure in which the unit price of each succeeding block of usage is charged at a lower unit rate than the previous block(s). The number of rate blocks and the size and pricing of each block vary among service providers depending on the specifics of the customers or classes of customers to which the rate structure is applied.

Increasing Block Rates: An increasing block rate is a structure where increasing rates are charged for increased consumption. Increasing block rate structures have been used in areas experiencing strong growth in water demand, threats to existing water supplies, or a movement towards greater water efficiency.

Page 22

Disadvantage

Advantage

§ Implementing a declining rate structure requires that the utility analyze its current metering and billing data. Without sound data it is difficult to design the declining block structure. § A declining block rate structure may tend to promote consumption rather than conservation.

§ Offers a mechanism to recover cost differences based on class of use and demand characteristics. § When properly designed target revenues can be reliably met.

§ This structure requires metering as well as a definition of consumption blocks by customer classes over which rates increase. It may be difficult to set rates that produce dependable revenue streams. § Simple or poorly designed increasing block rates run the risk of being inequitable throughout the consumer classes. § Revenue volatility can occur since an increasing block rate anticipates recovering greater revenue streams at higher consumption levels. These higher levels of consumption tend to be related to variations in seasonal weather, and when combined with higher unit pricing, consumers tend to lessen consumption in these higher consumption blocks.

§ Increasing block rates are considered to be conservation-oriented. If properly designed, increasing block rates can send an appropriate conservation signal to certain customer classes through maximizing the consistency of the price schedule.

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4.3

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Recommended Rate Structure Model

To meet the Municipality’s objectives discussed in Section 4.1 the current Flat Rate structure must be replaced with a volume-based structure. Given that the Municipality has limited customer water usage data available, Declining Block or Increasing Block models will be difficult to design. When cost and usage data by customer or service classification is not available the Uniform Rate model is a suitable approach. The uniform rate structure is the most common billing method used in Ontario5. As noted in Table 5, developing a uniform rate is relatively straightforward. 4.4

Uniform Rate Structure Design

In developing the Uniform Rate structure a number of key factors must be assessed to maintain revenue stability. In the case of the municipality only the following is known: §

Total number of customers

§

Total volume of water produced at each of the three water treatment plants

§

Total cost to operate and maintain the three water treatment plants (and sewage treatment plants)

The rate will be composed of fixed and variable charges as discussed in the following sub-sections. 4.4.1 Fixed Charge The fixed charges will recover the costs associated with meter reading, billing administration and the cost of installing and maintaining the meters (meter charge). Expenditures related to meter reading activities will depend on the type of meter reading system installed. Sub-section 2.2 discussed two options for meter reading equipment; a) Touch Read Acquisition; and b) Walk-by Radio Frequency 5

“2001 Survey of Municipal Water Rates in Ontario”, The Water Utility Council of OWWA. KEEWATIN-ASKI LTD. CONSULTING ENGINEERS & ARCHITECT

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Acquisition. The Touch Read Acquisition method will produce daily meter reads of 175 to 450 and the Walk-by Radio Frequency Acquisition can record over 1000 reads per day. Using a conservative estimate of 300 meter reads per day results in approximately 40 person-hours to complete the field reads on the 1501 Municipal customer accounts. The estimated payroll cost related to this time commitment will be $1,100 per month6. In addition there will be vehicle expenses (gas, maintenance, insurance) incurred traveling the meter reading route. It is recommended that a budget of $1,500 per month be allotted for the meter reading payroll cost plus the vehicle expense. The billing administration costs relate to downloading the field data into the meter reading data acquisition software and exporting the data file to the Municipality’s Vadim utility software. In addition there will be costs to print bills, mail bills and collect payments. An overall billing administration cost of $2,000 per month is suggested. The cost to purchase and install the meters will be debentured by the Municipality over 20 year period. The monthly cost to finance this approach is $9,100 per month7. The meter charge should also include an allowance for meter repairs and replacement. The normal life span for the meters is 15 years at which time they would require replacement. Using a straight-line depreciation method, a monthly allowance of $6,300 will cover the depreciation rate for the meters and periodic repair costs. The distribution of meter charges and other fixed charges to customers is commonly calculated using equivalent meter ratios since meter costs are a function of size. Typical customer meter equivalent ratios are given in Table 6.

6 7

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Table 6 Equivalent Meter Ratios Meter Size (inches) 5/8 3/4 1

Equivalent Meter Ratios 1.0 1.1 1.4

A summary of the fixed charges are provided in Table 7. These charges will recover the costs directly associated with serving customers, irrespective of the amount of water use. Table 7 Summary of Fixed Charges

Meter Reading Billing Administration Meter Charge Depreciation Expense Sub-Total Meter Size 5/8” 3/4” 1” 1 ½” 2” 3” 4” 6” 8”

Monthly Expense

Customer Accounts

$1,500 $2,000 $9,100 $6,300 $18,900

1501

Base Monthly Charge $12.59 $12.59 $12.59 $12.59 $12.59 $12.59 $12.59 $12.59 $12.59

Equivalent Meter Units 1.0 1.1 1.4 1.8 2.9 11.0 14.0 21.0 29.0

Base Monthly Charge $1.00 $1.33 $6.06 $4.20 $12.59 Monthly Charge By Meter Size $12.59 $13.85 $17.63 $22.66 $36.51 $138.49 $176.26 $264.39 $365.11

4.4.2 Variable Charge The uniform rate structure includes a charge per unit of water consumed (consumption charge) which is variable in that the amount the customer pays varies based on the amount of water the customer consumes. To set the consumption charge component of the uniform rate structure the total cost of producing drinking water plus the total cost of treating wastewater is divided by the forecasted metered consumption sales. The consumption charge calculation is provided in Table 8. Sixty-eight percent (68%) of the charge covers the cost of

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Municipality of Red Lake Water Meter Feasibility Study

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water and the remaining thirty-two percent (32%) is related to wastewater infrastructure costs. In some instances separate consumption charges are used for class-based rates (residential, commercial, industrial), however historic customer consumption data is required to design such a rate structure. Table 8 Consumption Charge Calculation Total Cost of Drinking Water Production, Storage and Distribution Total Cost of Wastewater Collection and Treatment Sub-Total

$1,205,000 $568,000 $1,773,0008

Forecasted Sales

650,0009 cubic meters

Uniform Consumption Charge $2.7277 per cubic meter

4.4.3 Sample Residential Bill Calculation Table 9 provides a sample calculation using the uniform rate structure discussed in the foregoing sub-sections and three consumption scenarios (low, medium, high). The sample calculation shows that the low consumers could see a small decrease in their bill while the higher consumers will see an increase of $307 which is largely due to the meter charge. Table 9 Sample Residential Bill Calculation Low 410 l/c/d 217 m3/yr $2.7277 $592 $49 $12.59

Medium 520 l/c/d 285 m3/yr $2.7277 $777 $65 $12.59

High 630 l/c/d 352 m3/yr $2.7277 $960 $80 $12.59

Total Monthly Bill

$62

$77

$93

Total Annual Bill

$743

$928

$1,111

Variance From Current Flat Rate10

-$61

$124

$307

Consumption Per Capita Consumption Per Residential Account Consumption Rate Consumption Charge per Year Average Consumption Charge per Month Fixed Charge

8

Municipality’s 2007 Department Estimate Municipality’s 2006 water system flow records adjusted for system losses and forecast of metered consumption reduction. 10 Municipality’s 2007 flat rate for residential customers is $547.23 (water) + $257.09 (sewer) = $804.32 (see Appendix ‘A’ for complete 2007 flat rate structure) 9

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Negotiated Contract Rates

The Municipality currently has an arrangement with Placer Dome and Goldcorp for the payment of water consumed by the two mines. The billing is based on a proportion of metered consumption to total municipal water production times the total cost of municipal water production. If the water cost component of the uniform rate (68% of $2.7277) were used to calculate water consumption charges for the mines, the billings to the mines would more than double. The Municipality will need to decide whether the current billing arrangement with the mines is maintained or whether the uniform rate is implemented.

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FUNDING OPPORTUNITIES

Potential funding opportunities to offset the capital cost of installing meters were investigated. In April 2007, Federal and Provincial funding agencies were consulted to evaluate the possibility of securing capital funding for the water meter project. Table 8 lists the potential funding sources contacted. Each of these funding agencies prioritize applicants according to environmental criteria such as reduction in energy consumption, ecosystem impacts, measurable impacts on the natural environment, and encouraging people to be more environmentally responsible. Unfortunately, many of the consulted sources seemed doubtful of the project receiving funding since it is not viewed as urgent as other environmental projects often submitted by organizations/municipalities. Many of the funding agencies listed in Table 10 were selected from the database at The Green Source. The Green Source is an online directory of Canadian funding agencies available for environmental projects undertaken by municipalities and other organizations. This database is constantly being updated and changed so it is advisable to monitor the database for other likely funding candidates as time progresses. The Green Source homepage is located at http://www.ec.gc.ca/ecoaction/grnsrc/index_e.cfm.

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Table 10 – Possible Funding Opportunities Fund

Sponsor

Funding Available

Community Conservation Initiatives

Ontario Ministry of Energy

Up to $100,000

The Green Municipal Fund

Federation of Canadian Municipalities.

Northern Energy

Conservation Fund Ontario Trillium Foundation

Northern Ontario Heritage Fund Corporation Ontario Power Authority Ontario Trillium Foundation

Webpage

Contact

http://www.energy.gov.on.ca/

Bryan Byrnes (416) 212-7919

Up to 50% Project Costs

http://www.sustainablecommunities.ca/G MF/

Andrée Thomas (613) 241-5221 [email protected]

Up to $100,000

http://www.mndm.gov.on.ca/nohfc/progr am_nep_e.asp

1-800-461-8329 [email protected]

Evaluated by Need

http://www.conservationbureau.on.ca/

Bryan Young (416) 967-7474

http://www.trilliumfoundation.org/

1-800-263-2887

Up to $75,000

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APPENDIX ‘A’ 2007 FLAT RATE STRUCTURE

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2007 Flat Rate Structure Annual Rates Customer Class

Water

Sewer

Total

Residential

$547.23

$257.09

$804.32

Commercial (without food preparation per unit)

$273.59

$128.57

$402.16

$6,566.65 $3,085.31

$9,651.96

Hospital Long Term Care (per room)

$547.23

$257.09

$804.32

Government Business

$2,188.74 $1,028.47

$3,217.21

Police Station

$2,188.74 $1,028.47

$3,217.21

Assembly Hall

$547.23

$257.09

$804.32

Restaurant

$547.23

$257.09

$804.32

Motel/Hotel (per room)

$248.77

$116.56

$365.33

$2,281.53 $1,072.12

$3,353.65

Laundromat Hotel/Motel Common Room

$273.59

$128.57

$402.16

Bed & Breakfast

$273.59

$128.57

$402.16

Commercial (with food preparation)

$547.23

$257.09

$804.32

Commercial Water Resale

$273.59

$385.71

$659.30

Hairdresser (per station)

$273.59

$128.57

$402.16

Licensed restaurant/lounge

$1,094.37

$514.23

$1,608.60

Car Wash

$1,094.37

$514.23

$1,608.60

High School

$9,941.30 $4,662.10 $14,603.40

Public School

$6,019.51 $2,628.22

$8,647.73

Separate School

$3,009.75 $1,414.09

$4,423.84

Covenant Christian School Mines - Metered

$601.93 metered

$252.81 -

$854.74 -

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