Water Demand Projection Accuracy and Demand Management Trends in California Cities

Abstract This study investigates the accuracy of long‐term water demand projections and tracks the evolution of water demand management incentives across 61 California water suppliers from 2000 to 2020. Through a systematic analysis of Urban Water Management Plans, we find that water suppliers consistently overestimated future demand by an average of 25% for 5‐year projections and 74% for 20‐year projections. This overestimation stems primarily from assumptions about per capita water demand rather than population growth estimates. While suppliers generally projected stable or increasing per capita demand, actual water demand per capita declined by 1.9% annually between 2000 and 2020, leading to a decoupling of water demand from population growth. Concurrently, we document a substantial increase in water demand management incentives, with non‐voluntary regulations emerging as the dominant demand management approach by 2020, largely driven by state policies like the Model Water Efficient Landscape Ordinance and California Green Building Standards. Demand management efforts have evolved from primarily indoor and educational initiatives toward outdoor‐focused non‐voluntary regulations and rebates. This shift appears closely linked to the reduction in per capita demand that suppliers failed to fully capture in their water demand projections. Our findings underscore the importance of incorporating dynamic conservation trends into demand projections and suggest that suppliers should develop more sophisticated forecasting methods that account for the continuing evolution of water efficiency incentives. This research provides valuable insights for water resource planners seeking to improve the accuracy of water demand projections in an era of increasing conservation and climate uncertainty.