AN COMHCHOISTE UM CHOMHSHAOL, IOMPAR, CULTÚR AGUS GAELTACHT 31Ú DÁIL ÉIREANN / 24Ú SEANAD ÉIREANN TUARASCÁIL AR SHOLÁTHAR UISCE MEITHEAMH 2012 JOINT COMMITTEE ON ENVIRONMENT, TRANSPORT, CULTURE AND THE GAELTACHT 31ST DÁIL ÉIREANN / 24TH SEANAD ÉIREANN REPORT ON WATER PROVISION JUNE 2012 1 2 INDEX 1. PREVIEW AND RECOMMENDATIONS.............................................................................7 1.1 Status of New Irish Water Utility .....................................................................8 1.2 The Principle of Metering ................................................................................9 1.3 Metering: Mechanisms, Etc ............................................................................9 1.4 Charges and Tariffs ......................................................................................10 1.5 Upgrade of Infrastructure – Key Performance Indicators, Mandatory Leakage Rates, Capital Works, etc. ...........................................10 1.6 Water Conservation and Planning Regulations............................................10 1.7 Poverty Proofing ...........................................................................................11 1.8 Outstanding Water Rates .............................................................................11 1.9 North / South Basis for River Basin Management ........................................11 1.10 Regulation.....................................................................................................11 1.11 Consumer Representation............................................................................12 1.12 Waivers .........................................................................................................12 1.13 Optimising Opportunities for the Small and Medium Enterprise Sector .......12 1.14 Emergency Planning and Flooding...............................................................12 1.15 Transparency and Accountability..................................................................13 1.16 Branding of New Irish Water Utility ...............................................................13 1.17 Audit of Water and Wastewater Services .....................................................13 1.18 Water Storage...............................................................................................13 1.19 Public Private Partnerships...........................................................................14 1.20 Raising of Funds by new Irish Water Utility ..................................................14 2. INTRODUCTION ...............................................................................................................15 3. EXECUTIVE SUMMARY...................................................................................................19 3.1 Background to Establishment of new Irish Water Utility...............................20 3.1.1 Decisions to Establish a New Irish Water Utility ...........................................20 3.1.2 Structure of New Irish Water Utility...............................................................21 3.2 Conclusions Based on Joint Committee Meetings and Available Research ................................................................22 3.2.1 Establishing New Irish Water Utility .........................................22 3.2.2 Communications, Health and Safety, and Emergency Response Systems for New Irish Water Utility.........................23 3.2.3 Corporate Governance.............................................................24 3.2.4 Metering....................................................................................24 3.2.5 Costs, Tariffs and Waivers .......................................................25 3.2.6 Procurement Models and Value for Money..............................26 3 4. PROVISION OF DRINKING WATER................................................................................28 4.1 Introduction ...................................................................................................28 4.2 Water Quality ................................................................................................28 4.3 Water Usage Volumes ..................................................................................30 5. WASTEWATER SERVICES .............................................................................................32 5.1 Introduction ...................................................................................................32 5.2 Collection and Treatment..............................................................................32 6. ESTABLISHMENT OF NEW IRISHWATER UTLITY........................................................35 6.1 Background to Establishment of New Irish Water Utility ..............................35 6.2 Decision to Establish New Irish Water Utility................................................35 6.3 Structure of New Irish Water Utility...............................................................36 6.4 Current Cost of Water Provision ...................................................................38 6.4.1 Future Funding of New Irish Water Utility ................................39 6.5 Transition Strategy........................................................................................40 6.6 Transfer of Assets and Liabilities from Local Authorities to New Irish Water Utility...................................................41 7. COMMUNICATIONS, HEALTH AND SAFETY AND EMERGENCY RESPONSE SYSTEMS TO BE PUT IN PLACE IN THE NEW IRISH WATER UTILITY ......................42 7.1 Communications ...........................................................................................42 7.2 Health and Safety .........................................................................................43 7.3 Emergency Response System .....................................................................46 7.4 Specific Regional Initiatives ..........................................................................47 7.5 Models of Best Practice ................................................................................48 8. NEW IRISH WATER UTILITY – CORPORATE GOVERNANCE AND REGULATION ....50 8.1 Background – What does Corporate Governance Entail in the Public Sector? ......................................................50 8.1.1 Significant Documents..............................................................51 8.2 Accountability and Corporate Governance...................................................52 8.2.1 Relevance to New Irish Water Utility........................................52 8.2.2 Revised Code of Practice for State Bodies..............................53 8.3 Future Corporate Governance of New Irish Water Utility .............................56 8.3.1 Background to Public Sector Governance ...............................56 8.3.2 State-Owned Enterprises .........................................................57 8.3.3 Background to Corporate Governance and Regulation of Water Services............................................59 8.3.4 Economic Regulation ...............................................................60 8.3.5 Environmental Regulation ........................................................61 8.4 Proposed Corporate Governance Structure and Regulatory Model for New Irish Water Utility................................................63 8.4.1 Representing Consumers.........................................................67 4 8.4.2 Internal Structure of New Irish Water Utility and Reporting Requirements .........................................68 8.4.3 Relationship with Regulators....................................................70 9. METERING........................................................................................................................73 9.1 Defining Water Metering ...............................................................................73 9.2 International Organisations Views on Water Metering .................................76 9.2.1 Organisation for Economic Cooperation and Development.....76 9.2.2 Defining Water Metering...........................................................77 9.2.3 European Union .......................................................................77 9.2.4 United Kingdom – Environment Agency ..................................78 9.3 Effects of Metering ........................................................................................78 9.4 Examples of Countries Using SMART Meters..............................................79 9.5 Ireland’s Experience of Meters to Date.........................................................82 9.6 Issues and Concerns Regarding Metering ...................................................82 9.6.1 Universal Metering ...................................................................83 9.6.2 Cost of Installation....................................................................86 9.6.3 Location of Meters....................................................................88 9.6.4 Technological Issues................................................................89 9.6.5 False Readings ........................................................................90 10. COSTS, TARRIFFS AND WAIVERS ................................................................................91 10.1 Introduction ...................................................................................................91 10.2 Effects of Water Pricing (Price Elasticity of Demand)...................................91