The regulator, i.e. Polish Waters, will be able to block a water price increase if it is unjustified – assured the Ministry of Infrastructure. The ministry also commented on progressive tariffs, which municipalities will be able to introduce after changing the regulations.
“In the event of minor price changes, the regulator will support municipalities in the process of making substantive decisions, but in the event of a significant price change, the role of the regulator (Wód Polskie – ed.) will be stronger – it will be able to block price changes if they are not justified,” it explained in the Ministry of Infrastructure answered PAP's questions, adding that the proposed changes to the regulations do not provide for the liquidation of the regulator's function, but only change the scope of its functioning.
This concerns the draft amendment to the Act on collective water supply and collective sewage disposal and the Water Law Act, published in January on the website of the Government Legislation Center (RCL).
The new regulations provide for a change in the method of approving water and sewage tariffs and the role of Wody Polskie as the current regulator of water prices. The key change is that municipalities will have the competence to approve water and sewage tariffs.
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Municipalities will set water tariffs
The modification of the regulations provides for a change in the method of approving water and sewage tariffs and the role of Wody Polskie as the current regulator of water prices. The key change is that municipalities will have exclusive competence to approve water and sewage tariffs.
Currently, the tariffs are approved by Polish Waters. If the local government does not agree with the regulator's decision, it may appeal first to the president of Wody Polskie and then to the court (the regulatory body is Wody Polskie, i.e. the director of the Regional Water Management Board. The appeal body is the president of WP – ed.).
According to the proposed regulations, Polish Waters will be able to obligatorily or optionally interfere in the process of approving water and sewage tariffs. The obligation for the regulator will appear when the proposed tariff assumes an increase of more than 15%. compared to average tariffs from the last 3 years. “In such a case, the regulator's position will be binding. Therefore, approval of the tariff will require positive approval from the regulatory body,” the Ministry of Infrastructure noted.
The optionality, in turn, will consist in a possible opinion on the draft tariff by Polish Waters if the price increase does not exceed 15%. and the commune will apply for it. “The commune head, mayor or president, taking care to protect residents against unjustified increases in water and sewage disposal prices, will decide on the need to obtain such an opinion. The position of the regulatory body will only constitute an opinion that the commune may not take into account,” MI explained.
A new solution – progressive tariffs
The project also provides for the possibility of introducing progressive tariffs, in which the rate increases with each cubic meter of water consumption.
The Ministry emphasized that the decision on this matter will be made independently by the commune, which will take into account “specific conditions in its area, as well as, among others, data on water consumption by residents.”
“The draft act introduces maximum limits for the differentiation of water fee rates depending on consumption, which is intended to ensure the clarity of the progressive tariff system and the protection of consumers,” it added. At the same time, the ministry admitted that it did not have data on how many local governments were interested in introducing a progressive tariff.
According to the Polish Waterworks Chamber of Commerce, the introduction of a progressive tariff will negatively impact the financial situation of enterprises and will also significantly increase prices in some water consumption thresholds, which will worsen the situation of some recipients.
Method of calculating fees in the progressive tariff
According to the proposed regulations, progressive tariffs will increase the rates, e.g. with the increase in water consumption. The introduction of such tariffs is to be based on an appropriate act of local law. It would have to contain individual thresholds in the form of the amount of water collected and differences between the rates included in individual thresholds.
“It is expected that the progressive water fee rate will take into account the number of people in a household, which can be determined, among others, by submitting an appropriate declaration. It is assumed that municipalities that decide to introduce progressive rates will have the opportunity to reduce the prices of access to drinking water for residents, and on the other hand, they will be able to shape rates for higher water consumption in a very flexible way,” it was indicated in the assessment of the effects of the project regulations.
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