Why It Matters
A new study projects that climate change could force municipalities to spend billions upgrading water infrastructure, potentially doubling household water costs in vulnerable cities by mid-century. The findings highlight a widening affordability crisis, particularly for low-income households already struggling to pay utility bills.
What Happened
Researchers at Stanford University and collaborating institutions examined how climate-driven water scarcity will reshape municipal water systems across the country. The study, published in Nature Sustainability, focused on Santa Cruz, California, as a case study for understanding how cities dependent on surface water will adapt to prolonged droughts.
The research identifies climate change as a driver of costly system upgrades—including new water transport infrastructure, desalination plants, and sewage water recycling facilities—that will be passed to ratepayers through higher bills. Jennifer Skerker, the study’s lead author and a civil and environmental engineer now working for a local water utility, found that these capital investments pit two critical needs against each other. “So this really pits water affordability against water reliability, when in reality we need both of these to have safe, accessible and affordable water for everyone,” Skerker said.
Low-income households, despite consuming significantly less water than their wealthier neighbors, face disproportionate financial strain when rates climb. Already, one in six American households report being behind on utility bills, according to the National Energy Assistance Directors Association.
By the Numbers
Nearly double — potential increase in household water costs in some cities under driest-scenario projections
$60 to $111 per month — projected range for median water bills among Santa Cruz’s lowest-income residents by mid-century, in 2026 dollars
Two-thirds — the reduction in water consumption Santa Cruz achieved over two decades by 2021 through conservation
Three times — the ratio of water rate increases to inflation over the past two decades
One-third — the proportion of Santa Cruz households that could struggle to afford water under the driest climate scenario
One in six — American households currently behind on utility bills
Zoom Out
The Stanford study identifies “water affordability hotspots” across the country where similar pressures will emerge. However, the analysis reveals important regional variation: cities with larger reservoir capacity, more interconnected water systems, or access to lower-cost water sources may avoid the steepest rate acceleration that Santa Cruz faces.
Santa Cruz’s particular vulnerability stems from its complete reliance on surface water—a dependency that intensifies during extended droughts. The city has already demonstrated aggressive conservation, cutting water use by nearly two-thirds over twenty years, but further reductions face physical and practical limits.
Water rate increases have already outpaced inflation significantly. Over the past two decades, water rates nationwide have risen at three times the rate of general inflation, squeezing household budgets even before climate-driven infrastructure costs materialize.
What’s Next
Skerker emphasized the fiscal burden on municipalities and ratepayers alike, noting that “it does seem unsustainable, and I think cities really need more help from the state and federal government.” The study suggests that addressing water affordability will require coordinated policy action beyond municipal budgets—including potential federal or state subsidies, regional water-sharing agreements, and continued investment in alternative water sources. Cities identified as affordability hotspots will likely face pressure to develop comprehensive strategies balancing climate resilience with household cost protection.