Water and wastewater utilities periodically conduct rate studies to assess existing rate structures and to potentially modify rates and fees to best meet the financial goals and objectives of the agency.

Outputs of cost of service/rate studies may include recommendations on a new classification system for utility customers, new basis for setting wholesale rates, increasing or maintaining the utility's revenue requirements, allocation of system costs to customers, and development of alternative rate structures. Utility rate studies encompass a comprehensive study of the consumer (residential, commercial or industrial), consumption patterns (monthly, quarterly or annual trends), macro and micro economic conditions, condition of the infrastructure and other factors that affect a utility's operations. Rates designed or modified as a result of such a comprehensive study enable generation of a revenue stream that supports increasing operating and maintenance costs as well as funding of capital improvement projects to rehabilitate an aging infrastructure.

A communications plan is usually developed in conjunction with the rate study to ensure effective dissemination of information on increased rates to customers. This plan includes key audience, key messages, communications vehicles, time lines and other pertinent information that allows the utility to effectively communicate rate change information to customers while ensuring "buy-in" from internal and external stakeholders.

RNR Consulting provided assistance to the Divisions of Water and Water Pollution Control of the City of Cleveland through the preparation of comprehensive financial plans that included the rate and cost of service studies. With a 640-square-mile service area that encompasses more than 1.5 million people throughout the City and 72 neighboring suburbs, the Cleveland Division of Water is the largest water system in Ohio and among the ten largest in the United States.