Wednesday 22 August 2018

Companies face higher water charges under new tariff rules

Stock image
Stock image

Paul Melia Environment Editor

THOUSANDS of businesses face being hit with higher water charges when a new tariff system is introduced.

Almost 190,000 firms will be impacted by the new charging system which comes into effect in 2019.

The new system aims to standardise tariffs across the country but it will result in winners and losers.

Currently, more than 500 different tariffs are in place and imposed by the country's 31 local authorities for non-domestic customers, ranging from small retail outlets to heavy industry, including those in the IT and pharmaceutical sectors.

Prices vary from a low of €1.59 per 1,000 litres in Kildare, to a high of €3.04 in neighbouring Wicklow.

The water regulator will streamline the complicated charging system as part of efforts to make it more transparent, which is likely to result in standard rates being applied.

This will inevitably result in some firms being asked to pay more, while others will pay less.

It is not clear how many firms will be forced to pay higher bills, nor is it decided what will happen in cases where local authorities have entered into legal contracts to provide discounts to customers.

In an information note, the Commission for Regulation of Utilities (CRU) says that tariffs currently imposed are in place since 2013, and that a framework has been in place since last year aimed at updating the system.

"The framework will introduce harmonised non-domestic tariffs, which will benefit non-domestic customers in terms of transparency, simplicity and equity," it said.

The work is complicated by the fact that as many of 33pc of non-domestic customers, or 63,000, are mixed-used customers such as farmers or those 'living above the shop', who use water for business and domestic purposes.

Domestic charges have been scrapped, so Irish Water and the regulator will have to ensure that households are not obliged to pay.

An industry group has been established to facilitate engagement with the business and industry community, the CRU said, which has met three times.

The project to introduce a standard tariff had been delayed to allowed the Dáil Committee on the Future Funding of Domestic Water Services to complete its work.

The public consultation phase will begin early next year, when the CRU publish information papers setting out possible tariff structures.

These could include a national charge, or one which varies across geographical locations; a tariff structure which could include a volumetric and/or standing charge, and discussions around how firms will transition to the new system.

The new system will be introduced from quarter 3, 2019.

Separately, the CRU has also said it will shortly begin a public consultation on a new connection charges regime.

Irish Water is obliged to establish a connection charging policy, to replace the existing arrangement which includes more than 900 connection tariffs.

The 31 local authorities use different methods for calculating the charge to connect to the public water supply and wastewater system, which will be streamlined.

The system affects builders of one-off homes and developers, as well as industry.

A final decision is expected in the second half of next year. Public consultation is expected to begin over the coming months.

Irish Independent

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