Will the price of water in Poland increase?

Czy cena za wodę w Polsce wzrośnie?

Changes are being made to the way water tariffs are set. However, not everyone is happy with them – as the new government is moving to liberalize the market. According to skeptics, the result of the proposed solution could be a higher price for water. Local governments, on the other hand, are pleased, as they will gain greater control over local budgets and flexibility in water and sewage management.

Government proposes to return to old rules

The Ministry of Infrastructure has presented the assumptions of a new law regulating the way water and sewage tariffs are set. It comes in response to long-standing objections by local governments to the Polish Water Authority, which has so far served as a tariff regulator. According to the new regulations, local governments will be the body that sets prices for water and sewage disposal – tariffs will be set on the basis of a resolution of the municipal council. This means a simplification of the process and a partial return to the rules that were in place until 2017.

What should the process look like in practice? Water and sewerage companies will submit to the mayor, mayor or president an appropriate application including the amount of the new tariff and the justification for the change. After verifying the project’s compliance with current regulations, the municipal council will be able to adopt the relevant resolution, which will be published in the Public Information Bulletin.

Why are local governments fighting for the right to set tariffs?

The existing regulations include a two-instance procedure in the event of an intention to change water and sewage tariffs. This is because municipalities must submit their applications to Polish Water for approval each time. Thus, the process gets longer and makes it more difficult to make urgent, individualized decisions. In turn, the price for water should reflect local characteristics. Local governments also point to the sluggishness and arbitrariness of the Water Authority’s decisions. According to the data, in 2022. Local governments submitted 850 applications for tariff changes, and only 150 of them were granted.

According to local government officials, decentralization of the water supply and collective sewage disposal system would enable better management of small water and sewage companies. They also make no secret of the fact that the increases are necessary due to increases in the price of electricity and water treatment products. Many villages and cities also have investments for the health and safety of water consumers, which require additional funding. The price for water should take them into account.

Will the price of water increase and when?

The amended Law of October 27, 2017 on Amending the Law on Collective Water Supply and Collective Sewage Disposal, according to the Ministry’s announcement, will enter into force as early as the third quarter of 2024. This means that water prices could rise later this year. The government, defending itself against the objections of critics of the new law, points out that the amended regulations include an instrument to control the increase in the tariff level. It stipulates that if the price for water or sewage disposal in a given municipality increases by more than 15 percent, the Water Authority will have the right to intervene. The tariff approval fee will also be abolished, allowing water and sewage companies to cut costs.

The government’s arguments do not convince the opposition, which persists with the current regulations that ensure central oversight of water and wastewater tariffs. According to her, the amendment to the law will cause the price of water in many regions of the country to rise unjustifiably, to the detriment of consumers. The fact is that the price for water and sewage disposal in different regions already varies. According to the Local Government Portal, in 2023. The average combined price for both services in Poland’s 20 largest cities was PLN 11.93 per 1 cu.m., or more than 12 percent. increase compared to 2018. In Sosnowiec, the increase over the period reached more than 45 percent.

The highest tariffs were in Silesia, where the average combined price for water and sewage exceeded even PLN 16. Much more secretive was, among other things. In Wroclaw, Szczecin, Poznan, Lodz and Bialystok. These municipalities have submitted applications for tariff increases, but their processing has dragged on for more than a year! Lowest water prices in 2023. were in effect in Lodz and Bialystok – these cities unsuccessfully requested an increase as early as 2021.

The question is who really loses as a result of the underfunding of local water and sewerage companies, and whether the lower price for water pays off for consumers in the long run.

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