Transcript Document

Water Services Training Group
14th Annual Conference
New Decade – New Challenges
9th September 2010
New Decade - New Challenges
Annual Conference September 2010
Water Metering & Charging
Ivan Grimes
Principal Officer
DEH&LG
New Decade - New Challenges
Annual Conference September 2010
Water Charging - Policy
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Domestic water charges were abolished in 1996 and
Water Pricing Policy was agreed by Government in
November 1998
Policy requires local authorities to recover the cost of
providing water services from the users of these
services, with the exception of households using the
services for domestic purposes.
WPP provides for full cost recovery without profit,
with charges based on actual metered consumption.
Cost includes elements of infrastructure provision
including meter installation and operation and
maintenance costs and varies from authority to
authority.
New Decade - New Challenges
Annual Conference September 2010
Water Charging – new policy?
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Renewed Programme for Government (October 2009)
includes a commitment to introduce:
“charging for treated water use in a way that is fair,
significantly reduces waste and is easily applied. It will be
based on a system where households are allocated a
free basic allowance, with charging only for water use in
excess of this allowance. In keeping with the allocation of
greater responsibility to local government, Local
Authorities will set their own rates for water use.”
Water Charging – new policy?
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In December 2009, Minister Gormley announced that
Government had agreed to the preparation of
legislation to remove the prohibition on charging
domestic users for water services and to provide a
legal framework for local authorities to charge for
water and waste water services above a free
allocation.
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Minister also noted his intention to bring forward
detailed proposals for a programme of metering for
households on public water supplies.
Domestic charges – current position
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Minister has indicated that proposals for
the installation of meters in households
on public supplies are being finalised
Proposals to be put before Government
Objective of metering will be to
encourage households to save water
Complementary to the investment in
conservation under new WSIP
Benefits of Metering - Theory
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Metering will require substantial
investment so it must be worthwhile
Metering should enable customers to
moderate consumption and thereby
reduce amount they pay in charges
Metering should improve the capacity of
the water authority to manage the
network thereby reducing operational
costs and asset replacement costs
Benefits of metering - Reality
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UK Walker Report noted average 10%
reduction in household consumption when
metered and a further 5% in reduced customer
side leakage
 Substantial reductions in household
consumption on Group Water Supplies which
have been metered
 Non-domestic sector – increased awareness
of cost of water and interest in water-saving
and harvesting technologies
OECD Environmental Review 2010
Notes that the absence of metering;
 Gives households zero incentive to save water
 Perpetuates users’ low awareness of use and
costs
 Creates inequities between households
 Exacerbates lack of incentives in planning and
building to focus on water economy
Metering - summary
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Government decision required
Challenges of implementation – funding,
installation, customer data, customer
service
Benefits – improved management, short
and long term savings, reduced strain on
water resources, reduced CO2
emissions.
Charging – comparisons
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Average combined charge for nondomestic sector in 2010 is €2.32 per m3
(ranging from €1.49 to €3.04)
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Average combined charge for nondomestic sector in 2009 was €2.29 per
m3 (ranging from €1.49 to €3.04)
Charging – other EU states (2008)
Austria - €2.57
Finland - €2.45
Sweden - €1.60
Netherlands - €1.72
France - €2.93
Germany - €3.73
England - €3.94
Denmark - €5.81
Charging – full cost recovery?
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Abstraction controls?
Costs of monitoring, inspections, etc.
Capital cost and depreciation
Cost of compliance (waste water discharge
licenses)
Collection rates
Delivering a quality customer service
Engagement with schools – can this be
repeated with other water users?
Charging – future challenges
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Cost recovery in a weakened economy
Non-domestic – collection rates
Domestic charges – overcoming resistance
Implementing (and funding) measures in
RBMPs
Reducing leakages from distribution network
Understanding and explaining the economics
of water