Water Authority Board Approves 2026 Wholesale Rates

The San Diego County Water Authority’s Board of Directors today approved wholesale water rates for 2026 following a public hearing and approved the recommended budget for the next two fiscal years. Despite ongoing inflationary pressures and the continued impacts of climate change on the Southwest, the Water Authority minimized impacts on ratepayers through a number of cost-saving actions.

Water Authority staff and Board members collectively reduced the final 2026 wholesale water rate increase to 8.3%, less than half of what was forecasted in early 2025. The reductions were achieved by cutting budgets across the agency, including capital improvement projects, operating departments, the Board of Directors, and equipment replacement. In addition, the adopted rate was lowered by third-party water exchanges and financial benefits from the conclusion of litigation between the Water Authority and the Metropolitan Water District of Southern California.

“Since I became chair in 2024, I have been laser focused on affordability for ratepayers,” Board Chair Nick Serrano said. “While I recognize the impact of this increase on working families around the region, the Water Authority is now on a path for smoother and smaller rate increases in the future that will provide the financial stability our region needs while still ensuring safe and reliable water supplies.”

Homes and businesses will feel the impact of the newly adopted rates differently, based on their water use and how local retail water agencies handle costs.

As the region’s wholesale water agency, 91% of the Water Authority’s costs are driven by just three things: water purchases and treatment, debt service, and infrastructure projects to ensure the reliability and safety of water delivery. During the rate and budget cycle, the Water Authority faced increasing costs related to its main water supplies, along with the need for continued investments in the region’s decades-old water supply and delivery system.

Despite those pressures, the agency’s early investments in climate adaptation mean San Diego County has secure water supplies even though it’s at the end of the pipeline and has few natural water resources. Those investments in reliability, combined with the legal settlement, create the potential for the Water Authority to transfer or exchange some of its water with other agencies to help reduce costs for San Diegans.

“While there’s still work to be done, a future where San Diego County can help other communities improve their water security will be a win for our ratepayers for years to come,” said Water Authority General Manager Dan Denham.