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Opinion With such a meagre allowance, our new water charges can't be about conservation

Charging us for water that is a basic need, when we have no option or alternative but to use that water, is simply a measure in cost recovery.

IN THE LAST few years almost everyone in Ireland became expert economists, able to discuss the ins and outs of promissory notes and bank recapitalisations. In recent weeks we’re all becoming experts in something else: water management.

Thanks to the recently announced water charges that will face Irish households over the coming months, we can now quickly estimate how many toilets flushes our 30,000 litre allowance will give us (8 flushes per house) or how many standard showers we will be able to take a day before we are charged for the pleasure (1 per house). We are now eyeing up our baths suspiciously, wondering how much it will cost to fill them. On average, the allowance for a household is less than half of what an individual person would use on average each day. But those with children can breathe a sigh of relief – each child will get you an extra 38,000 litre allowance.

But let’s take a step back and remind ourselves why this is happening again. Well, the Minster told us last week that the new water charges are all about conservation. We need to incentivise reduced water consumption, to ensure security of quality water supply, to aid economic recovery and protect our environment.

What will these charges actually achieve?

While the new charges may sting, I doubt anyone would argue with those noble objectives. But will introducing water charges achieve them? The answer is yes and no. Consumers will definitely think twice before turning that power shower for a nice, leisurely shower in the morning. Or filling a bath. It will also encourage the installation of rainwater tanks and dual flush toilets so that we can become a little more self-reliant.

But 30,000 litres per household is very little. Will charging us for usage above that threshold reduce our demand to the level the government has allocated? I don’t believe it will. Charging for water is useful in reducing the amount of water we use (or overuse), but it will have little impact when it comes to non-discretionary use of water. I mean, there’s a certain amount of water that is needed for a household to function, ie the water you need for the basics of drinking, cooking and cleaning.

Is this just a measure in cost recovery?

Water at those low volumes is considered to be relatively inelastic. Price elasticity is an economic term used to describe how much the demand for something can be influenced by a change in the price for that product, ie the higher the price of a product, the less of it you will use. But elasticity depends greatly on the product. In the event that a product is a basic necessity, there will be less elasticity and less room for a change in how much you use.

So charging us for water that is a basic need, when we have no option or alternative but to use that water, is in fact just a measure in cost recovery.

But we still need to find the money to run Irish Water somewhere. So the question is where? We spend €1.2 bn a year on water provision so it is a costly exercise. However, there were other options available to the Government which would have provided for the same revenue raising (in the short-medium term anyway), would have encourage water conservation and would have protected those that cannot afford another charge on their basic needs.

For example, the Government could have set a higher free allowance – one that would have covered non-discretionary uses – and charged a higher rate for discretionary water use. This would have had the same results. That said, the better we get at reducing our demand, the less money the government will make. But, this couldn’t possibly matter, as the primary purpose of the charges is conservation not revenue … right?

Water management: the Australian example

I worked with the New South Wales Government in Australia developing and implementing policies around the Water Management Act 2000. This act allocated available water resources between all the different users; water authorities, the environment, businesses, etc. In effect, it put water rights on a legislative par with property rights. It was complex stuff, with lots of add-ons, chops and changes to make allocation of water resources as fair as possible. As you can imagine, they’re quite stingy about how they manage water and its use in Australia. But we had a clear mandate – the job was to make sure that water allocated fairly amongst the different user groups and used for its highest value purpose.

I believe that the Irish Government’s approach to water charges lacks this clarity.

We need ways to help people conserve water – for example, in Australia, the water authorities provided retrofitting packages and advice to help homeowners use less water at home. We need to provide grants to enable people to install more costly systems like rainwater tanks or dual-flow toilets. We need to enable people to use less water by providing them with the information to monitor their usage. Once they know what they use, they can work on ways to reduce it.

Hopefully, the Government will be in a position to fill in some of these address some of these needs in the near future. But until it does, it’s not surprising that many people see Irish Water as a body set up to impose another charge on Irish households, rather than a company that will help us conserve a valuable resource.

Jennifer Whitmore is a local election candidate in Wicklow. She previously worked for 10 years alongside Australian government ministers to develop environmental law, water management and energy policy.

Read: What will your water allowance of 30,000 litres get you?

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