Water could be more expensive for Denver residents next year.

Denver Water commissioners received a staff proposal for rate increases Wednesday expected to generate about 6% more revenue in 2027. What individual customers pay would depend on where they live and how much water they use.

The utility last raised its rates in January, increasing Denver consumers’ bills an average of about $2.45 to $3.30 per month.

Under the new proposal, the average monthly bill for a single-family Denver customer would rise from $56.97 this year to $60.21 next year. For the average Denver household, that would mean paying about $3.24 more per month.

Customers outside the city would see different increases, depending on how their water service is provided.

“The proposed modification to the rate structure means that those who conserve will see a smaller increase than those who use more water,” said Fletcher Davis, Denver Water rates manager. “So, most importantly, the more you use, the more you’ll pay.”

The difference becomes pronounced as water use climbs.

A typical Denver household would pay about $35 more over the year, according to Denver Water. A city household among the top 5% of water users would pay about $98 more. Outside Denver, some of the heaviest users could see annual increases of $150.

Why the increase in water rates?

Inflation.

And a historic drought.

This year’s drought has already forced Denver Water to take extraordinary steps.

Denver Water declared a Stage 1 drought in March after Colorado’s snowpack peaked at about 58% of normal and weeks earlier than usual. The utility, which relies on mountain snowpack to supply 1.5 million people across the metro area, imposed restrictions in an effort to preserve reservoir levels and avoid more severe measures.

Conditions became so dry that Denver Water began draining Antero Reservoir in May, moving the water to the deeper Cheesman Reservoir to reduce evaporation loss. Antero averages only about 8 feet deep and spreads across a broad surface exposed to sun and wind, while Cheesman reaches depths of about 200 feet.

The move was expected to save roughly 5,000 acre-feet of water — about a quarter of Antero’s capacity. Antero typically receives about 13,700 acre-feet of water annually. This year, officials expected just 500 acre-feet, potentially the lowest inflow on record.

Denver Water has never moved beyond Stage 1 drought restrictions. But officials have warned that continued dry conditions could force Stage 2 restrictions next year, which would ban outdoor watering.

Drought isn’t the only pressure.

Inflation has risen 3.4% nationally over the past 12 months, according to the U.S. Bureau of Labor Statistics. In the Denver metro area, prices have climbed even faster — 3.9%.

Some expenses in the Denver metro area have seen far steeper increases. Energy prices are up 17.2% from a year ago, gasoline 25.6%, household furnishings and operations 6.3%, and food 3.4%.

Denver Water isn’t immune to those rising costs.

The utility is maintaining an aging system while investing in major infrastructure projects, including the Gross Reservoir expansion, lead pipe removal, water main replacements and improvements at its Marston treatment plant.

The proposed rate structure also reflects Denver Water’s push for conservation. It is designed to make essential water use cheaper relative to heavier consumption. Denver Water proposes lowering the first residential usage tier, while increasing the second and third tiers. Fixed charges also would account for a larger share of rate revenue.

The proposed 2027 increase does not include drought pricing, Denver Water spokesperson Jimmy Luthye said in an email to The Denver Gazette.

Under another proposal presented Wednesday, the Stage 1 drought charge for second-tier residential and nonresidential use would rise from $1.10 to $1.40, while the third-tier charge would increase from $2.20 to $2.80.

Drought charges are added to regular rates.

Multifamily customers would also pay more. The average monthly cost per dwelling inside Denver would increase from $17.42 to $19.49, or $2.07 a month.

Commissioners heard a staff presentation on the proposed rate increases Wednesday, and they did not ask any questions.

No decisions were made at the meeting. Commissioners are not expected to vote on the rate hike until October.

Established as a public utility in 1918, Denver Water is funded by water rates, new tap fees — which were increased earlier this year — and hydropower sales, not taxes.