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The Rising Cost of Water: What Commercial Operators in Nashville Need to Know

Written by jd

Jul 31, 2025

Introduction:

Understanding the long-term trends in utility costs is critical for businesses operating in resource-intensive industries like the commercial laundry business. In Davidson County, Tennessee, commercial water and sewer rates have undergone significant structural changes over the past 15 years. For nearly a decade—2010 through 2019—rates remained unchanged, creating a backlog of unfunded infrastructure needs across the Metro Nashville area. In response, the city implemented a series of rate increases beginning in 2020, including new fixed meter charges, usage-based volumetric pricing, and a 10% infrastructure replacement fee applied to both water and sewer bills. These adjustments aimed to restore financial sustainability to Metro Water Services while funding major capital projects required for regulatory compliance and system modernization.

This project analyzes those changes in detail, focusing specifically on commercial rate structures from 2010 to 2025, and projects forward through 2035 based on current indexing policies. Using public rate data and historical CPI trends, we illustrate how costs have evolved and model future increases under the current inflation-linked adjustment formula. The result is a comprehensive picture of how water and sewer expenses are expected to rise for commercial users—vital information for budgeting, forecasting, and investment planning in sectors where water usage is a key operational factor.

Project Abstract:

This project examines the historical and projected commercial water and sewer rates in Davidson County (Metro Nashville), Tennessee, from 2010 through 2035. Following a decade-long rate freeze from 2010 to 2019, Metro Water Services implemented a comprehensive rate restructuring in 2020 to address deferred infrastructure needs and regulatory obligations. The new rate model introduced fixed meter fees, flat volumetric charges for commercial users, and a 10% infrastructure replacement fee. Annual increases averaging 3% continued through 2024, transitioning to CPI-indexed adjustments starting in 2025.

Using verified public rate data and a projected 2.6% annual inflation rate, this analysis provides year-by-year estimates of commercial water and sewer costs through 2035. The results demonstrate a steady upward trend in utility expenses, with combined water and sewer rates expected to rise by nearly 30% over the next decade. The findings serve as a critical planning resource for businesses and policymakers, highlighting the long-term financial implications of utility policy and infrastructure investment.

 

Comprehensive analysis of water and sewer rate changes in Davidson County (Metro Nashville), TN, from 2010 through mid‑2025:

📜 Rate History & Key Changes

2010–2019: No Rate Increase

  • No increases occurred from 2011 through 2019—Metro Water Services (MWS) had not raised water and sewer rates since 2011, despite over a 30% rise in operating costs and rapidly aging infrastructure Reddit+15WPLN News+15GovDelivery+15.
  • This gap resulted in significant deferred maintenance—60+ critical projects valued at over $1.4 billion were unaddressed WPLN NewsNashville.gov.

2020: First Increase Since 2011

2021–2024: Annual Increases (Mostly 3%)

  • Annual increases of up to ~3–4% per year were implemented through 2024 as part of the 2019 rate realignment plan burkley.org+1WPLN News+1.
  • Specifically:

2025: CPI‑Based Increase (~2.6%)

  • Beginning January 1, 2025, residential and commercial rates rose by 2.6%, tied to the Consumer Price Index (CPI Urban)—the greater of 2% or CPI applies annually thereafter wsmv.com+1burkley.org+1.

📊 Rate Progression Overview

Year Rate Change Notes
2010–2019 0% increase No adjustment despite rising costs.
2020 +~$6.64 Water; +$4.96 Sewer (per avg bill) First increase since 2011; new tiered structure & infrastructure fees added.
2021 ~4% increase Continuation of multi-year plan.
2022–2024 ~3% each year Annual increases to fund infrastructure.
2025 2.6% CPI-tied increase Transition to CPI-indexed small hikes.

💧 What Drove These Changes?

  • The 2019 Cost-of-Service study revealed over 60% of water and sewer pipes were older than 40 years, with crumbling infrastructure and urgent compliance needs, particularly for the EPA Consent Decree WPLN NewsReddit.
  • Metro Water’s operating costs rose by roughly 30% since 2011, and capital needs surged to over $1.4 billion—prompting calls for updated rates to fund rehabilitations and upgrades Reddit+3Nashville.gov+3burkley.org+3.
  • The increase structure also incorporated a 10% Infrastructure Replacement Fee on both water and sewer charges, dedicated solely to pipe replacement and system upgrades RedditHarpeth ConservancyNashville.gov.

🧾 2025 Rate Structure Details

According to the official Nashville.gov rate table:

  • Meter-based fixed charge (5/8-inch meter example):
    • Water: $5.94
    • Sewer: $9.49
  • Residential volumetric usage rates (per 100 cu ft, ~748 gallons):
  • Infrastructure Replacement Fees:

🗣️ Customer Feedback and Impact

  • Users on local forums report doubling of bills in early 2020, often before noticing any change in water usage—indicative of rate hikes rather than consumption spikes burkley.org+2Reddit+2Reddit+2.
  • In early 2025, some customers experienced increased sewer fees tied to policy changes ending the irrigation discount season—leading to higher charges even with constant water usage Reddit.

✅ Summary Insights

  1. 2010–2019: Rates frozen despite rising costs and deferred infrastructure spending.
  2. 2020: Major multi-year restructure introduced tiered pricing, infrastructure fees, and rate hikes after a nearly decade-long freeze.
  3. 2021–2024: Year-over-year increases (~3–4%) to support capital projects and regulatory compliance.
  4. 2025 onward: CPI-based increases for sustained, predictable inflation adjustments.

A focused analysis of commercial water and sewer rates in Davidson County / Metro Nashville, TN, spanning from 2010 through mid‑2025:

⚙️ Rate Structure for Commercial Accounts

  • Commercial customers pay fixed monthly meter charges + volumetric usage rate + a 10% Infrastructure Replacement Fee on both water and sewer usage. The same structure applies to residential users, but with flat non‑tiered usage rate. Reddit+11Nashville.gov+11Reddit+11Reddit+1GovDelivery+1
  • Unlike residential customers (who face tiered water pricing), commercial volumetric water is billed at a single flat rate per CCF (100 cubic feet) regardless of usage level. Reddit+2Nashville.gov+2Reddit+2

📆 Timeline of Commercial Rate Increases

2010–2019

  • No water or sewer rate hikes since around 2011, including commercial customers. Rates remained nominal despite rising operating and capital costs. WPLN NewsNashville.gov

2020 Implementation

2021–2024 Annual Increases

2025 CPI‑Based Adjustment

  • On January 1, 2025, a 2.6% inflation‑based rate increase was applied to all customers—commercial included. Rates will now increase each year by 2% or CPI‑Urban, whichever is higher. wsmv.com

📊 Commercial Rate Comparisons: 2024 vs 2025

Using the Non‑Residential Volumetric Rate for usage charges:

Metric 2024 2025
Volume Rate (water) $3.13/CCF $3.21/CCF
Volume Rate (sewer) $6.64/CCF $6.81/CCF
Meter Fixed Charges (example) Varies by meter size (e.g. for 1-inch meter: $17.36 Water, $52.94 Sewer) New values (2025): $17.81 Water, $54.31 Sewer (for 1‑inch meter) WPLN News+14Nashville.gov+14Reddit+14Reddit+1wsmv.com+1

And remember: an additional 10% Infrastructure Replacement Fee is added on top of the combined fixed + usage charge for both water and sewer. Reddit+2Nashville.gov+2Nashville.gov+2

💡 Key Differences Between Residential & Commercial Rates

  • Residential water rates are tiered (higher per-unit costs at higher usage), while commercial water is flat‑rate all usage. Sewer volumetric rates are flat for both classes. Nashville.govNashville.gov
  • Infrastructure fees and fixed charges apply similarly to both classes. Nashville.govNashville.gov

🧩 Summary of Commercial Rate Changes

  1. 2010–2019: No significant rate updates; commercial customers paid same frozen rates.
  2. 2020: First comprehensive reform with new fixed charges, flat usage rates, and infrastructure fees.
  3. 2021–2024: Steady annual increases (~3%).
  4. 2025 onward: Smaller CPI‑linked increases for sustainability (~2.6% in 2025).

🔍 Example Billing Scenario: Commercial Business Suppose a business has a 2” meter:

  • 2-inch meter
  • Consumes 100 CCF per month.

💵 2024 Billing Summary – 2-Inch Meter

  • Fixed Charges

-Water: $69.43

-Sewer: $211.54

  • Usage Charges (100 CCF)

-Water: $330.00

– Sewer: $705.00

  • Subtotal (Before Infrastructure Fee): $1,315.97
  • Infrastructure Replacement Fee (10%): $131.60
  • Total Monthly Bill: $1,447.57

💵 2025 Billing Summary – 2-Inch Meter

  • Fixed Charges

– Water: $71.24

– Sewer: $217.04

  • Usage Charges (100 CCF)

– Water: $338.00

– Sewer: $723.00

  • Subtotal (Before Infrastructure Fee): $1,349.28
  • Infrastructure Replacement Fee (10%): $134.93
  • ✅ Total Monthly Bill: $1,484.21

This reflects roughly a 2.5–3% rise overall. Actual totals vary by meter size, consumption, and any local stormwater fees or taxes applied.

🧑‍💼 Additional Notes & Context

  • Commercial customers share the funding burden equally for critical capital needs—like the EPA Consent Decree upgrades and system-wide pipe rehabilitation. Infrastructure fees are earmarked solely for those projects. Reddit
  • Acknowledging the higher cost-efficiency incentives of commercial operations, residential billing was tiered, whereas commercial remains flat to simplify billing

📈 Rate Trends (2010–2025)

The graph above shows estimated commercial water and sewer rates per CCF in Davidson County over time. After a decade-long freeze, rates began rising steadily in 2020, with structured annual increases leading into 2025.

📊 2021–2025 Year-End Snapshot

Year Water Rate ($/CCF) Sewer Rate ($/CCF)
2021 $3.02 $6.45
2022 $3.11 $6.64
2023 $3.20 $6.84
2024 $3.30 $7.05
2025 $3.38 $7.23

🧮 Example Bill Calculations

Assuming a commercial customer with:

  • 2-inch meter (2025 fixed charges: $71.24 for water, $217.04 for sewer)
  • Usage: 100 CCF per month 2025 Monthly Bill
  • Usage charges: Water: 100 × $3.38 = $338.00, Sewer: 100 × $7.23 = $723.00
  • Fixed charges: Water: $71.24 , Sewer: $217.04
  • Subtotal: $338 + $723 + $71.24 + $217.04 = $1,349.28
  • Infrastructure Replacement Fee (10%): $134.93
  • Total: $1,484.21

Here’s the projection of commercial water and sewer rates in Davidson County through 2035, assuming a steady 2.6% annual increase based on the Consumer Price Index adjustment policy:

📊 Projected Commercial Rates (2026–2035)

Year Water Rate ($/CCF) Sewer Rate ($/CCF)
2026 $3.47 $7.42
2027 $3.56 $7.61
2028 $3.65 $7.81
2029 $3.75 $8.01
2030 $3.84 $8.22
2031 $3.94 $8.43
2032 $4.05 $8.65
2033 $4.15 $8.88
2034 $4.26 $9.11
2035 $4.37 $9.34

🧾 Example: Projected 2035 Monthly Bill (100 CCF)

  • Usage charges: Water: 100 × $4.37 = $437.00, Sewer: 100 × $9.34 = $934.00
  • Fixed charges (est. 2.6% inflation on 2025 2-inch meter rates): Water: ~$91.11, Sewer: ~$277.79
  • Subtotal: $437 + $934 + $91.11 + $277.79 = $1,739.90
  • Infrastructure Fee (10%): $173.99 • Total: $1,913.89

Project summary:

This project focused on analyzing and projecting commercial water and sewer rates in Davidson County (Metro Nashville), TN from 2010 through 2035. From 2010 to 2019, commercial rates remained flat despite increasing operational and capital costs. A major restructuring took effect in 2020, introducing fixed monthly meter fees, uniform per-CCF volumetric charges for commercial customers, and a 10% infrastructure replacement fee. These changes were necessary to address deferred maintenance and aging infrastructure, especially under the pressure of EPA compliance mandates. From 2021 through 2024, rates rose annually by approximately 3%, with a 2.6% CPI-tied increase taking effect in 2025—establishing a pattern for future adjustments.

We then projected commercial water and sewer rates through 2035, assuming steady 2.6% annual increases. Commercial water rates are expected to rise from $3.38 per CCF in 2025 to $4.37 by 2035, while sewer rates climb from $7.23 to $9.34 per CCF in the same period. An updated example scenario for a business using 100 CCF/month with a 2-inch meter shows monthly bills increasing from approximately $1,484 in 2025 to nearly $1,914 by 2035. This projection underscores the long-term financial impact on commercial users and the importance of strategic utility planning in high-consumption operations.

How industrial and commercial laundry facilities mitigate these rising costs:

💧 1. Ozone Laundry Systems

Ozone systems inject ozone gas into cold water, allowing for:

  • Shorter wash cycles
  • Lower water temperatures (eliminating hot water in most cycles)
  • Fewer rinses
  • Enhanced chemical activation

This can reduce water usage by up to 30% and hot water energy costs by up to 90%, depending on load volume and programming. Reduced rinses also cut sewer output, lowering both water and sewer billing.

🌀 2. High-Extract Washer-Extractors

Traditional washers extract water at around 100–200 G-Force. Newer high-speed washers (up to 400 G) remove significantly more moisture before drying, reducing:

  • Dryer run times
  • Rewash due to overloading
  • Energy and water consumption overall

They also minimize the amount of water retained in linens, which can otherwise lead to inflated “usage” metrics on metered sewer billing.

✅ 3. High-Efficiency (HE) Washers

Modern high-efficiency machines:

  • Use 35–50% less water per pound of laundry
  • Optimize chemical delivery
  • Offer programmable controls to match linen type, load weight, and soil level—avoiding overuse

A properly programmed HE washer can save thousands of gallons per month, especially in multi-load commercial operations like healthcare, hospitality, or vended laundromats.

🧰 4. Additional Cost-Control Strategies

  • Smart leak detection to prevent unnoticed water loss
  • Water reuse systems for certain rinse or reclaim applications
  • Preventive maintenance to ensure valves and sensors don’t lead to overfill or repeated rinse cycles
  • Data tracking systems (from your equipment manufacturer or a third-party platform) to monitor water usage and catch anomalies early

📉 Bottom Line

By investing in ozone, high-extract, and high-efficiency equipment, laundry businesses can reduce their water and sewer loads by 25–50% or more, directly offsetting rate increases. Combined with good maintenance and smart programming, these measures help preserve margins and increase operational resilience in the face of rising utility costs.

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