Household Occupancy and Residential Water Demand

Having reconstructed the New York rate-design history, the next question is factual: how does household occupancy affect indoor residential water demand? The answer matters because a conservation tariff prices total volume measured at the meter, while the number of people relying on that meter can vary substantially from one household to another.

New York utility-specific evidence documents that relationship. In the 2016 SUEZ conservation study, Black & Veatch reported that higher indoor water use in Ramapo reflected, in part, the town's higher persons-per-household value. The same study included a figure comparing indoor water use with the number of residents and showed increasing household use as resident count rose. It also identified Rockland County's 2010 average household size as 3.07 and used an approximately three-person reference household in the analysis supporting the 5-CCF first block.²⁷

Broader residential end-use research reaches the same general conclusion. Indoor demand is composed of recurring uses such as toilets, showers, faucets, clothes washing, dishwashing, cooking, and other household functions. Fixture efficiency and customer behavior can reduce the amount used for those functions, but the number of people performing them remains a material determinant of total indoor demand. This is why occupancy appears in residential demand research, utility planning, and water-budget programs alongside other variables such as housing characteristics and fixture efficiency.²⁸

Occupancy is not the only explanation for higher meter volume. Leaks, inefficient fixtures, outdoor use, guest activity, housing characteristics, and individual behavior can also increase consumption. The relevant conclusion is therefore narrower than saying that higher household use is usually essential. Additional residents can increase basic indoor demand independently of waste, and total household volume alone does not reveal the cause of that higher use.

Liberty's 2024 Threshold Analysis illustrates the point using New York data. Liberty reported an AWWA benchmark of 58.6 gallons per capita per day and approximately 4,209 gallons per month for the 2.33-person household shown in its AWWA-based figure. For the Liberty sample, Census data indicated an average household size of 2.94; applying the same per-capita benchmark, Liberty calculated estimated monthly use of approximately 5,254 gallons. Liberty described the 20 percent difference as entirely driven by household size. The study also estimated that indoor-only use could reach its 15,000-gallon Tier 4 threshold at roughly 8.4 occupants using the 58.6-gallon benchmark, or roughly 7 occupants under a 20-percent-higher sensitivity assumption.²⁹

Liberty then examined accounts with repeated Tier 4 occurrences during non-peak months. After excluding three unusually large homes, Liberty reported that the remaining 64 accounts represented 1.49 percent of the Tier-4 account group used in that step of the analysis; it compared that figure with Census data indicating that 1.27 percent of U.S. households had seven or more occupants. The company did not claim that household size had been proven to cause every occurrence. It concluded that the similarity suggested that the impact of Tier 4 rates on larger households needed further study. Liberty later testified that further study was not required at that time and that it lacked sufficient data for a different rate design, leaving the prevalence and bill effect unresolved.³⁰

These findings are important to rate equity because household volume and household efficiency are not the same measure. A household with more residents can use more water in total while using less water per person than a smaller household. Conversely, a small household can remain within a low block while using more water per person. A meter records total volume, not the reason for the volume. Conservation pricing may still rely on total usage, but regulators can reasonably examine whether the thresholds place a conservation premium on basic indoor needs associated with occupancy.

The point is not to classify all indoor use as essential or all outdoor use as wasteful. Basic indoor activities can be performed more or less efficiently, and some indoor use can be discretionary or caused by leaks. Likewise, some outdoor use can serve legitimate purposes. The more useful distinction is whether the rate structure gives households of different occupancies a reasonable opportunity to meet basic indoor needs before the stronger conservation price signal applies.

Households also take many forms. A household may consist of one resident, a couple, children, grandparents, multiple generations, relatives, or unrelated adults sharing a home. Nothing in the occupancy relationship depends on religion, ethnicity, neighborhood, or family structure. The relevant variable for this report is the number of residents relying on one residential meter.

Household occupancy therefore provides a documented and neutral basis for further rate-design analysis. The evidence does not yet determine the correct New York allowance, the number of Veolia customers who would qualify, the precise bill impact of an adjustment, or what share of current Veolia higher-tier use is attributable to occupancy rather than outdoor use, leaks, inefficient fixtures, or other causes. It does establish why occupancy should be examined directly rather than treated as though total household volume by itself identifies conservation behavior.