The Problem With Conservation Rebates

Originally published, in the Guelph Mercury Feb. 25, 2011

The water conservation rebate program here in Guelph represents just one more example where City Hall has extended itself beyond its mandate and spent beyond its means.

Under normal circumstances when a business has less demand for its product they cutback staff and look to reduce costs. Not in Guelph. We add to staff and the long term financial burden that comes with it.

So why is your water bill going up? For starters, past Guelph Councils decided to bribe you, with your money - to get you to reduce your water consumption. Rebates are handed out for installing water saving appliances in your home. Apparently, conserving to reduce the cost from your water bill wasn't incentive enough.

Some might wonder - what's the problem with a rebate - its free money from the city. Trouble is the cash isn't free - it is paid for by you and me as part of our water bill. Last year alone, according to the Waterworks department rebates cost over $800,000.

Now with people using less water – Guelph’s Waterworks Department has had less revenue to keep up with administration costs. So to cover their fixed costs water bills are going up again. This year the City agreed to increase water bills by - 10% in part to make up for the loss of revenue due to conservation.

It’s gets stranger. Now the waterworks department is asking the city to add more full-time personnel to their department during a period of falling demand. Seems, there are not enough staff to go around and administer the City’s self-imposed rebate program. More staff are now needed to make sure the water saving devices are installed as claimed.

Helping the environment in Guelph sure does cost you. You conserve to reduce your water bill and it goes up anyway with higher rates. Then your property taxes go up to help pay for salaries and benefits of the new inspectors who administer the City’s nanny state initiatives.

To be fair, Waterworks has indicated that the water conservation program saves the City over $130,000 annually and delays eventual infrastructure upgrades. This savings however is well shy of the $1.6 million annual cost of the conservation program that pushes people to conserve. The program should be scaled back by ending the rebates in order for costs to at least be in-line with projected savings. Otherwise, it is just another costly expenditure that hurts Guelph fixed income earners the most by adding to our perennial eye-popping tax and water rate increases.

Of course many groups who profit from the rebate program want it to continue and even expand. But this is just self interest at play from these groups who profit from the extra business they gain from customers who get rebates for using their goods and services.

Perhaps the City should just let market forces do their good work and stop using our money to push their own environmental agenda. Don’t get me wrong here, with a young family, I care deeply about the environment and conservation, but the cost of hydro alone should be the lever used to motivate people to conserve.

Most troubling with this misguided plan are its potential unintended consequences. I have heard from many frustrated citizens who did make a concerted effort to reduce their water consumption in order to protect the environment (and their wallets). I am sure they are wondering like me - what’s the point. Hopefully, they don’t give up on conservation altogether under a plan that has good intentions, but fails in practice. Giving rebates for something people were going to do anyway is just a poor use of funds.

Running a municipality isn’t glamorous work. Your mandate is to effectively administer programs that the province has handed on down. It demands sound financial management where over spending beyond your means is shunned. In Guelph, we overspend on initiatives outside of our mandate and then cut essential services during the summer in order to cover up budget shortfalls caused by poor decision making.

Perhaps some on City Council should consider other careers if making sure the buses run on time and the garbage is collected each week, doesn’t appeal to their greater sense of moral purpose.

Fighting for a worthy cause is certainly noble, but putting the city in a financial hole to do so - is not.