Cutting the water charge could cost Irish taxpayers more, says European think tank

Published by Ian Carey on

26th April, 2016

Putting a price on water encourages people to conserve it – that goes without saying.

But the reduction in water use  that comes from a charge could make the cost of providing water substantially cheaper overall – saving Irish taxpayers millions.

That is the finding of Green Budget Europe, a think tank which promotes policies that benefit the environment.

They found that when similar charges were introduced in other countries they led to a massive fall off in consumption – in some cases as much as 40 per cent.

This kind of reduction would take huge pressure off Ireland’s water infrastructure and substantially reduce the amount of investment needed to bring water treatment up to international standards.

In a letter to TDs sent yesterday, and seen by the Green News, the Director of Green Budget Europe James Nix explained:

“The longer water charges are suspended, the greater the overall cost to households. How is this?

“Eroding the incentive to save water raises consumption. As more water must then be pre-treated, pumped and post-treated, the overall cost is higher, and a greater sum needs to be paid via taxes than through charging.

“In the Czech Republic, household water consumption fell by 40 per cent, from 171 litres per person per day to 103 liters a day, in the 12 years following charging reforms in 1990. The situation in Denmark, which extended volume-based charging in 1993, is similar. Water charges transfer households away from what would otherwise be higher taxes.

“Under the EU water framework directive, the aim of water pricing is to “provide adequate incentives for users to use water resource efficiently”. “Social, environmental and economic effects” can shape these price levels; what is required from user groups is an “adequate contribution” .

“Any successful strategy to reduce costs for households must be based on evidence.  Suspending, or ending, water charges costs households more.”

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Ian Carey

Ian is the editor of the Green News. He works as Communications Manger with the Irish Environmental Network.