Water prices will be doubled soon, officials promise

Government officials said yesterday at a national conference that water prices are too low and should be raised to meet water companies' costs in maintaining water-supply facilities.

"It is necessary to raise water prices to NT$20 per cubic meter," Vice Premier Lin Hsin-i (林信義) told reporters after attending the 2003 National Conference on Water Resources yesterday.

"The hike in water fees can help prevent water waste by consumers," Lin said.

Currently, water fees are NT$7 to NT$9 per cubic meter. The rates have been frozen at the current level for nine years. The cost of processing water for household use, however, is NT$22 per cubic meter.

But Lin yesterday declined to specify when the government will raise water prices. He simply said the government has no plans for such a move in the near future. He didn't elaborate.

Although it is unknown when water prices will be changed, it is clear that the low price of water is unsustainable and has resulted in financial difficulties for the two major water suppliers in the nation.

According to government figures, Taiwan Water Supply Corp (自來水公司) and the Taipei Water Department (台北自來水事業處) saw their sales drop 1.73 percent and 3.05 percent last year, respectively, from the previous year's sales.

Because of the two companies' lack of funds, they cannot afford to repair old or worn water pipes that cause losses of 800 million tonnes of water each year. This is equivalent to two Feitsui Reservoirs annually, according to a recent Ministry of Economic Affairs report.

To reduce the water-leakage rate, Taiwan Water Supply Corp in March reported to the government that it planned to spend NT$3.5 billion to refurbish 670km of water pipe this year. In the past, the company allocated NT$200 million each year on pipe reconstruction, said Joseph Lu (呂桔誠), former vice chairman of the Commission of National Corporations, in late March.

The financial losses of the water companies, along with worsening water shortages in recent years, have forced the government to reconsider raising water fees.

"We'll propose a concrete measure on water-fee adjustment next year," said deputy director of Water Resources Agency Chen Shen-hsien (陳伸賢), who also attended the conference yesterday.

Aside from the general price-hike plan, in March the agency proposed raising water fees for heavy users during dry periods, usually from November to April, from NT$0.5 to NT$1.5 per cubic meter.

If the proposal is passed, the companies will increase income by 30 percent to 40 percent during the dry season, Chen said.