Dr. Casey Wichman Explores the Impacts of Budget-Based Rates with the CaDC

When Dr. Casey Wichman began his career in environmental economics, he encountered a problem that faces nearly all researchers: the need for data.

As social scientists, economists often employ the administrative data gathered by governments and businesses during their daily operations to study the behavioral impacts of prices, marketing, and other factors on consumers. In the water sector, these often contain personally identifiable information about customers, meaning that access is justifiably restricted to trusted recipients serving the public good.

Building this trust and reputation takes time and involves maintaining direct relationships and legal data use agreements with water utility agencies. This creates overhead time that could instead be spent on high-impact science working to advance the state of knowledge in water resource economics.

When Casey received a call for research proposals from the CaDC, he reached out to learn more about the CaDC’s efforts to remove these barriers and connect researchers directly to water agencies.

Barriers to Using Utility Data in Research

There are a number of barriers that increase the difficulty of accessing and using water utility data for research.

• As mentioned above, researchers like Casey need to establish personal relationships with staff at water agencies. While necessary for providing context for research questions and establishing trust, this can be a time-consuming endeavor.
• Because of the private nature of utility data, legal paperwork (such as NDAs and data use agreements) is required to ensure data confidentiality.
• Inter-agency differences in methods of data collection and organization require researchers to standardize datasets before analytical tasks, again extending the timeline of a given project.

Without a data liaison like the CaDC, getting access to data can require years of relationship building. By serving as an intermediary between water utility agencies and researchers, CaDC leverages existing relationships with CaDC members to assist individual researchers in accessing water-related data and completing sustainability and efficiency-related research projects.

The California Data Collaborative works to reduce these barriers by serving as a central data repository for key utility data such as metered water use and rebate program participation. When Casey saw a call for research proposals utilizing water billing records on CaDC’s website, he reached out to explore the possibility of an analytical project centering on budget-based rates.

Developing a Model to Assess Tiered Pricing and Variable Rates

While working with the CaDC, Casey partnered with Daniel Brent (Assistant Professor at Pennsylvania State University) and Derek Wietelman (a current graduate student at the University of Maryland). They developed a model of the impact of budget-based water rates and tiered pricing systems on conservation outcomes. Casey and his team were able to access customer usage and pricing data from multiple California-based agencies through the CaDC.

By streamlining data access for the project, Casey’s project was able to get off the ground much faster than it otherwise would. Soon to be completed, his team’s findings indicate that the conservation benefits of individualized, budget-based rates may be more limited in practice than proponents often expect. In addition, the pending publication finds that budget-based rates could potentially exacerbate underlying equity issues.

Expediting the Research Process

By working with the CaDC, Casey was able to get permission to access standardized data from multiple agencies more rapidly than he would have been able to otherwise. In turn, CaDC members benefited from the CaDC’s efforts to identify and connect these agencies with trustworthy, qualified researchers.

By outsourcing some of these tasks, researchers like Dr. Wichman are better able to build on existing data to develop important insights for individual agencies, as well as for the water sector as a whole.

Building Connections Between Researchers and Utility Agencies

In these ways, Dr. Wichman’s use of CaDC research tools helped avoid delays in the research development process while also expanding the reach and applicability of his findings. Dr. Wichman’s work will enable water-service providers in California and other water-stressed regions to improve conservation efforts and more deeply understand the equity and sustainability implications of budget-based rates and tiered-pricing policies.

Work With The CaDC

All CaDC data sharing is done with the explicit permission of our members who retain complete control of their data. If you are interested in working with the CaDC to explore research opportunities or evaluate internal water services through analytical projects, email us at info@theCaDC.org or visit theCaDC.org for additional case studies.

About Dr. Casey Wichman:

Dr. Casey Wichman is currently an assistant professor in the School of Economics at Georgia Institute of Technology and a University Fellow at Resources for the Future (RFF) in Washington, D.C. His research focuses on the intersection between the environment and public economics, asking the question, “how do human interactions with the environment inform our valuation of natural resources?” Dr. Wichman received his Ph.D. in Agricultural and Resource Economics from the University of Maryland and has worked as the Research Director of the Energy & Environment Lab at the University of Chicago‘s Urban Labs.