Infrastructure Issues Weigh Heavily on the Water Industry

By PlanetLaundry staff | Jan 22, 2010

It may be out of sight and out of mind for laundry owners, but within the water community, aging infrastructure is a never-ending concern and a top issue. Water professionals responding to the American Water Works Association’s 2009 State of the Industry survey were keen to point out that infrastructure repair and replacement – especially with regard to distribution – continued to lag behind the need.

In February 2009, while the AWWA survey was in the field, the U.S. Environmental Protection Agency published its fourth Drinking Water Infrastructure Needs Survey and Assessment. The assessment found that nationwide the drinking water infrastructure need is $334.8 billion for the period from January 2007 through December 2027.

Securing funding for infrastructure repair and replacement has always been a challenge for utilities because they compete with other, more visible capital needs in the public works portfolio. In 2009, however, with operating budgets squeezed dry and capital markets either dried up or prohibitively expensive, water industry professionals were more concerned than ever that infrastructure needs would be insufficiently funded. This sentiment fueled the relatively high degree to which infrastructure needs were judged inadequately addressed.

How infrastructure rehabilitation and replacement should be funded proved a polarizing issue in itself. Most respondents called for government funding, usually at the state or federal level, for utilities to replace infrastructure. However, others stressed that utilities should be responsible for funding their own infrastructure needs.

One utility executive complained, “Entries look to others to provide the funding to replace their infrastructure when they should be charging adequate fees to fund their own replacements and upgrades.”

A water wholesaler added that “the incentive to continue to maintain water systems is eroded as the government continues to award large sums of money to systems that have failed to maintain rather than reward those that do.”

Although rehabilitation and replacement made up the bulk of infrastructure issues, there were also continuing concerns about the possibility of cross-connections and contamination, as well as water leaks in the distribution system for which no revenue can be collected.

Source: American Water Works Association