Satellite images could be used to pinpoint homes that are wasting water
Home refurbishments would come with the installation of a water meter as a pre-condition under a new plan to deal with the contentious issue of paying for the Irish Water utility.
Irish Water may also be given the authority to use "satellite imagery" in order to pinpoint households that are wasting water.
The controversial proposals are contained in a compromise paper which was circulated to members of the Oireachtas Water committee.
The committee's 20 TDs and senators have just over three weeks to produce their final report which is set to bring an end to the current water charges regime.
While committee sources agreed that a deal is in sight, members remain at odds over various complex issues.
One of the latest sticking points to emerge relates to the issue of metering.
The draft document, compiled by committee chairman senator Pádraig Ó Céidigh, recommends that new builds and even refurbishments should be required to have meters installed.
"The Committee recommends that all new dwellings and dwelling refurbishments should be required to have water meters installed in order that the amount of household water consumption is clear to users and as a means of effective leak detection and conservation," the report states.
The document also recommends that "bulk metering" be installed for apartments and that the Government incentivise households to voluntarily take up a free meter.
Fine Gael is adamant that metering is essential for conservation.
But Fianna Fáil favours so-called district metering, which would not require a meter outside every property.
Another major area of contention between members relates to usage levels and how to penalise those who waste water.
The report states that Irish Water could use "satellite imaging" to "target the excessive and wilful wastage of water". It also states that those who "wilfully abuse water" or permit wastage can be prosecuted.
Fine Gael members last night expressed opposition to both measures, which have yet to be agreed.
In relation to potential prosecutions, both Fine Gael TD Kate O'Connell and Senator Paudie Coffey said they believed such a move would result in a flurry of court cases.
"We are opposing this forcefully and fully. We do not want to prosecute anybody," Mr Coffey told the Irish Independent.
Another key part of the report that has yet to secure agreement relates to the Commission for Energy Regulation (CER).
The report states that the CER should have a "central role" in determining what constitutes 'normal' and 'excessive' usage.
Fianna Fáil sources say they reject this assertion.
But significantly, the two main parties are now close to an agreement on how Ireland will meet its EU objectives in relation to water charges.
To date, Fine Gael has said it wants to introduce new measures aimed at penalising households that waste water - so as to ensure Ireland complies with its EU obligations.
But Fianna Fáil has insisted these obligations - laid out in the EU Water Framework Directive - can be met through a piece of legislation passed by the Dáil in 2007.
In legal advice issued to the committee by David Nolan SC, it is confirmed the 2007 law could be amended.
"It seems to me that the Water Services Act of 2007 can be amended to meet the overall obligations arising from the Water Framework Directive,"he said.