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San Jose Water outlines AMI rollout and defends rising fixed charges to Los Gatos council
Summary
San Jose Water’s local representative told the Los Gatos council the company is deploying smart metering (AMI) to detect leaks and improve customer service, and said rising wholesale costs and long-term infrastructure needs have shifted the utility toward higher fixed service charges.
San Jose Water Company representative John Tang told the Town of Los Gatos council on Sept. 2 that the utility is deploying advanced metering infrastructure (AMI) in Los Gatos to give customers near-daily usage visibility and earlier leak alerts, and that the company is investing in local infrastructure projects totaling tens of millions of dollars.
Tang said the AMI rollout is about 20% complete in the Los Gatos area and could be finished across the service territory by late 2026 or early 2027; the meters will let customers receive near-24-hour notifications of continuous usage and help reduce bills caused by undetected leaks. “With this technology, we're going to know within 24 hours that you have continuous usage going and we'll notify you within 24 hours,” Tang said.
The presentation focused heavily on the drivers of higher bills. Tang told the council that wholesale supply costs paid to Valley Water account for a large portion of what customers pay, and that the company is balancing conservation goals with revenue stability. He said the California Public Utilities Commission set a fixed-cost recovery floor and ceiling to protect utilities’ revenue when volume falls: “We were at about 35%, we went up to 40 and we're now up at around I believe around 47%,” Tang said, explaining that the shift explains much of the growth in the monthly service charge for a typical 3/4-inch residential customer (from roughly $27 in 2018 to about $70 today on the charts shown).
Council members pressed Tang on specific customer impacts and remedies. Vice Mayor Moore asked how the utility approaches consolidation or absorption of very small neighboring systems; Tang said San Jose Water will “entertain” absorbing small, adjacent mutual systems when they lack technical, managerial or financial capacity, but emphasized the company must balance fairness to current customers and available water supplies. A resident who said a meter on adjacent property had not worked for two years pressed the company on meter move costs and on whether a rising share of fixed charges undermines conservation; Tang acknowledged the tension and said permit and code constraints shape meter and service sizing.
Tang also described customer-assistance and grant programs the company used during the pandemic-era shutoff moratorium, noting San Jose Water applied state funds to help customers and pursued federal grants including a successful battery-energy-storage award as part of a group application. He said the company’s parent rebranded from SJW Group to H2O America and that the local operations remain staffed locally.
The council did not take formal action on the presentation. The session concluded with Tang offering to follow up individually with residents who had meter or billing questions.
What happens next: Council members asked staff to follow up on specific constituent meter-placement and bill-design questions with San Jose Water staff, and residents were invited to contact the company for one-on-one follow-up.
