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Cost of tap water could rise from next month
By Richard Fu |
May 30, 2013, Thursday
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Print Edition
Print Edition
SHANGHAI plans a public hearing next month that could pave way for the first water tariff increase since November 2010.
The cost of tap water averaged 2.13 yuan (35 US cents) per cubic meter in 2012, according to Shanghai Chengtou Corp, the local government investment vehicle that controls the city's three main municipal water suppliers - Shibei, Shinan and Pudong Veolia.
That compares with a selling price of 1.42 yuan per cubic meter, before tax, for local residents. Industrial and commercial users pay more.
Water supply costs in Shanghai had not been made public before but authorities said they would now be released annually and before any public hearing regarding tariff adjustments.
"Cost disclosure will be part of the water pricing reform in China," Luo Huimin, a chief economist at the Shanghai Development and Reform Commission, told reporters.
As with fuel, power and natural gas, water is another commodity for which the Chinese government is pursuing pricing reform to better reflect scarcity of resources and encourage conservation.
Residents can apply to take part in the public hearing via the commission or the local consumer rights protection association. The hearing, in late June, will be attended by 21 people, including nine consumer representatives.
No specific date has been set, the commission said.
It's not known how water tariffs will be adjusted. Authorities said earlier that Shanghai may introduce a progressive system to charge more for excessive use beyond a certain volume. Such a system is already used by the city's power companies.
Water supply costs mainly consist of raw water, power, distribution and depreciation of fixed assets, as well as other management fees, according to the details released by Chengtou.
Lin Zhongyi, a deputy section chief for planning and financing at the Shanghai Water Authority, said local utilities are facing tight cash flows and "high finance costs" at a time when the city has been building or upgrading more pipes and waterworks.
The city also has some district level water companies.
Shanghai's municipal water utilities reported a combined net loss of 517 million yuan (US$84.3 million) last year in their core business, widening from 419.6 million yuan in 2011, according to financial details released yesterday.
They sold 1.72 billion cubic meters of water in 2012, out of the 2.13 billion cubic meters that they produced last year.
The cost of tap water averaged 2.13 yuan (35 US cents) per cubic meter in 2012, according to Shanghai Chengtou Corp, the local government investment vehicle that controls the city's three main municipal water suppliers - Shibei, Shinan and Pudong Veolia.
That compares with a selling price of 1.42 yuan per cubic meter, before tax, for local residents. Industrial and commercial users pay more.
Water supply costs in Shanghai had not been made public before but authorities said they would now be released annually and before any public hearing regarding tariff adjustments.
"Cost disclosure will be part of the water pricing reform in China," Luo Huimin, a chief economist at the Shanghai Development and Reform Commission, told reporters.
As with fuel, power and natural gas, water is another commodity for which the Chinese government is pursuing pricing reform to better reflect scarcity of resources and encourage conservation.
Residents can apply to take part in the public hearing via the commission or the local consumer rights protection association. The hearing, in late June, will be attended by 21 people, including nine consumer representatives.
No specific date has been set, the commission said.
It's not known how water tariffs will be adjusted. Authorities said earlier that Shanghai may introduce a progressive system to charge more for excessive use beyond a certain volume. Such a system is already used by the city's power companies.
Water supply costs mainly consist of raw water, power, distribution and depreciation of fixed assets, as well as other management fees, according to the details released by Chengtou.
Lin Zhongyi, a deputy section chief for planning and financing at the Shanghai Water Authority, said local utilities are facing tight cash flows and "high finance costs" at a time when the city has been building or upgrading more pipes and waterworks.
The city also has some district level water companies.
Shanghai's municipal water utilities reported a combined net loss of 517 million yuan (US$84.3 million) last year in their core business, widening from 419.6 million yuan in 2011, according to financial details released yesterday.
They sold 1.72 billion cubic meters of water in 2012, out of the 2.13 billion cubic meters that they produced last year.
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