Businesses face a likely rise in water charges after regulators gave State utility Úisce Éireann the green light to spend almost €14 billion by 2029 on infrastructure needed to aid home building and meet growing demand.
A lack of services such as water supply and waste treatment are among several barriers delaying the construction of new homes in the Republic.
The Commission for Regulation of Utilities (CRU) said on Thursday that it has approved a “record €13.6 billion investment” by Úisce Éireann in critical infrastructure throughout the Republic by 2029.
Figures published by the commission indicate that businesses’ share of this could approach €2.4 billion.
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The CRU confirmed that “business customers are expected to see increases in charges” in the period up to 2029.
A separate process determines those charges and the CRU is due to publish its decision on this in July.
Rates vary according to what customers consume and any waste water they produce. Big industrial customers pay a greater share of the overall cost.
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The exchequer foots the bill for household water services, which will be in the region of €7.3 billion up to 2029.
Many businesses will pass on water rate rises to customers, Finbarr Filan, chairman of the Irish Small and Medium Enterprises association warned.
“Any of these extra costs that come in our door get passed on to the consumer,” said Filan, who runs a Centra shop in Sligo.
He argued that the consequence of the government U-turn on introducing domestic water charges following protests more than a decade ago was that consumers ended up paying anyway
At the same time, the failure to introduce those charges delayed the construction of vital infrastructure, he pointed out.
Aidan Sweeney, head of infrastructure policy at business group Ibec, said the Government should absorb “non-domestic” water charges between now and 2029 and increase the capital allocated to Uisce Éireann.
Upgrading water infrastructure is of paramount importance, Sweeney acknowledged.
“However, the costs of this investment disproportionately falls on to the business community through increased water charges, particularly within the context of other anticipated costs such as energy,” he added.
Uisce Éireann’s spending will cover 163 new and upgraded water treatment plants, increasing capacity by 43 million extra litres a day, 61 new waste treatment facilities, 126km of new pipes and 113km of new sewers, as well as other projects.
CRU chairman Fergal Mulligan said the decision was a major step forward in securing key infrastructure needed to support new homes and economic growth.
“In the period up to 2029, it can deliver a real step change in water and wastewater services, while helping to address long-standing infrastructure needs across the country,” he added.
The ruling will require Uisce Éireann to meet “core delivery obligations, keep priority projects on track and demonstrate measurable progress against targets”, Mulligan stressed.
Separately Uisce Éireann will seek funding later this year through the National Development Plan, under specific measures to speed up house building, the company said.
Welcoming the CRU’s decision, Úisce Éireann director of asset management Sean Laffey predicted that the investment the regulator has approved would result in hundreds of projects.
“Critically, it will support housing delivery by enabling new connections and addressing infrastructure constraints in key growth areas,” he said.
“Communities across the country will see further evidence of projects being advanced as we work to increase capacity, improve reliability and meet our environmental obligations.”
Justin Johnston, director of strategy, resilience and regulation, pledged that the company would spend the money “responsibly and efficiently”.
The State company has set out a comprehensive programme of projects giving clear visibility of planned work across the Republic’s 26 counties, Uisce Éireann said in a statement.
