How Rates Are Set

Understanding the Infrastructure Improvement Plan and rate review process

Cal Water’s rates are set by an independent, third party, state agency—the California Public Utilities Commission (CPUC)—with input from the public. We are required to file a new application every three years, so that rates reflect the actual cost of operating, maintaining, and upgrading our water system to provide safe, clean, reliable drinking water to our customers.

How Your Water Rates Are Set

Every three years, California Water Service (Cal Water) works with the California Public Utilities Commission (CPUC), an independent third-party state agency, to review and set our rates so they reflect the actual cost of serving our customers. This process, which typically takes 18 months or longer, involves a thorough review of infrastructure improvement projects (such as water pipes, fire hydrants, water treatment facilities, and more) across all Cal Water services areas that will enable us to continue providing safe, clean, and reliable drinking water.

How it Happens:

Cal Water reviews planned infrastructure improvements and submits an application to the CPUC.

The CPUC holds a formal hearing on the recommendations.

An independent public advocate analyzes Cal Water’s plan and makes its own recommendation.

A CPUC administrative law judge issues a proposed decision.

The CPUC hosts public hearings to receive input from Cal Water customers.

The CPUC commissioners vote on the proposed decision, with new rates typically going into effect soon after.