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Monday 29 May 2017

How families that conserve water could get a tax rebate

People should be allowed ‘opt-in’ to having a water meter installed on their property, and enjoy a tax rebate or other financial incentive if they reduce consumption, the water regulator has said. Stock Image
People should be allowed ‘opt-in’ to having a water meter installed on their property, and enjoy a tax rebate or other financial incentive if they reduce consumption, the water regulator has said. Stock Image
Paul Melia

Paul Melia

Householders would effectively earn money from beating their meter under radical plans to help save the water charging system from disaster.

People should be allowed 'opt-in' to having a water meter installed on their property, and enjoy a tax rebate or other financial incentive if they reduce consumption, the water regulator has said.

The details are contained in submissions to the Dáil committee on the Future Funding of Domestic Water Services, chaired by Galway Senator Pádraig Ó Céidigh, which sits today.

The Commission for Energy Regulation (CER) will also tell the committee that the metering programme, which has cost €465m to date, should be stopped, given the levels of investment needed to bring the network in line with EU quality standards.

In a submission, it says that despite 884,000 meters being already in place, it should "not be a priority" to continue the rollout. Currently, just 58pc of 1.52 million households are metered, and continuing the installation programme would require "significant" money.

"If a decision was taken to complete further metering then either significant additional funding would have to be made available or a significant level of necessary capital investment would have to be deferred from other priorities for water investment in the time period 2017-2018," it said.

Galway Senator Pádraig Ó Céidigh. Photo: Brian Farrell
Galway Senator Pádraig Ó Céidigh. Photo: Brian Farrell

"The CER considers that any decision to either complete or extend the rollout of the domestic metering programme should be evidence based, taking account of other capital investment priorities and include a cost-benefit analysis."

Both the CER and Irish Water will appear before the committee today as part of a probe into how the annual €800m operational costs and 20-year €13bn capital investment plan needed to upgrade the network will be funded.

An expert commission recommended that water for "normal personal use" should be paid from general taxation, with excessive or wasteful use incurring a direct charge. It also suggested that an allowance per household should be determined by the regulator.

But how families using excessive quantities will be identified in the absence of metering presents a problem. Data from Irish Water suggests that almost 20,000 metered households use in excess of 800 litres of water a day. Across the utility's customer base of metered and unmetered customers, the figure rises to almost 50,000.

Despite its misgivings, the CER points out that the meters have provided Irish Water with "vital information" about the state of the network, helping to identify and eliminate leaks. To date, some 65 million litres of water a day have been saved. In Denmark, it said, consumption fell by 12.6pc following the introduction of meters.

Consideration, it said, should be given to conservation measures including allowing customers request that a meter be installed.

"An opt-in approach could be provided for whereby customers opt to have a meter installed in return for some from of financial incentive by beating the allowance, eg some form of tax rebate," it said. It added that if households with meters were found to be using excessive quantities, the cost should not be punitive, but based on the cost of providing the water used.

To encourage conservation, incentives could be introduced to promote investment in water-saving technologies by way of a grant or tax relief. This "carrot" could be coupled with a change to building regulations requiring all new homes to be fitted with meters.

Irish Water will also suggest that legislation should be introduced to ringfence funding for necessary upgrades. It also said that enshrining the utility in public ownership would make the company a "more attractive credit proposition" for commercial lenders.

Irish Independent

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