Half of households could pay for water during future cuts

More than half of all householders could be paying for water, even when supplies are cut off, after charges are introduced in 2015. Meters will only be installed in 50 per cent of homes by the time the first water bills start arriving in 2015, Irish Water has confirmed.

Households without a meter will be paying an assessed or “flat rate” charge while those on a meter will be charged for what they use. During future cuts, those on a fixed rate could still have to pay even when they cannot get the service.

A spokesman for the Commission for Energy Regulation, which will be setting water rates by the middle of next year, said it was too early to say whether households on an assessed charge would be offered any rebate on their bills. The commission also indicated it did not intend to set an artificially low introductory rate, which it said would hurt consumers in the long run.

Bills are to be issued for the first time in early 2015, but they will be for water used in the third quarter of next year. The installation programme is scheduled to be completed for all homes assessed as suitable for a meter by the end of 2016.

A further 300,000 homes, mainly apartments and houses using shared supplies, will still be on a flat rate charge after this time.

Currently, people operating commercial premises are the only consumers paying for water. A Dublin City Council spokesman said they would not be entitled to any rates rebate because they were metered and so were not having to pay for water during the current nighttime shut down.

“Businesses such as restaurants and hotels have to have their own contingency plans, they should have 24 hours of water storage in place,” he said.

Meanwhile the commission has warned against delaying capital investment in infrastructure as a way of artificially depressing water prices.

The commission is currently conducting a consultation process ahead of its determination of the levels of domestic water tariffs and the charging system Irish Water will be permitted to use.

It said the utility would be expected to pass on “only reasonable and appropriate costs” to customers and must have a strong incentive to improve service and reduce costs from the outset of regulation.

However, it said a focus on short-term gains or looking for “quick regulatory wins” that would adversely affect stakeholders in the long term must be avoided.

“One example of a quick regulatory win would be delaying required capital expenditure in the water services infrastructure.

“Lower bills may be of benefit to water customers in the short term. However their long-term interests, with respect to quality of water supply and service and health standards, will be detrimentally affected if pipes/pumping stations etc are not fixed, maintained or upgraded as necessary,” it said

The commission also said that while provision had been made for borrowings by Irish Water to be guaranteed by the State, it considered that the utility would also require direct financial support and investment from the State.

A plan needed to be put in place where, over a defined period, Irish Water would become less reliant on State support.