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Fixed Costs Versus Fixed Revenue

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The District of Columbia Water and Sewer Authority (DC Water), like many utilities, puts a strong emphasis upon Financial Sufficiency and Revenue Stability in their approach to fiscal planning and setting rates and charges. Revenue Stability can be directly linked to the volatility of revenue recovery, which in turn is most likely the result of volumetric charges assessed on potentially volatile customer demand. In 2011, DC Water engaged Raftelis Financial Consultants, Inc. (RFC) to conduct an analysis to evaluate its current revenue recovery and the relationship between DC Water's fixed revenue and fixed costs. This study presents the Fixed versus Variable revenues and expenditures for DC Water, evaluates customer impact analyses, and offers conclusions on existing revenue recovery and recommendations for future revenue recovery.
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Document Type: Research Article

Publication date: 2012-01-01

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