THE Office of Utilities Regulation (OUR) yesterday revealed that it has granted the National Water Commission (NWC) increases of 18 per cent on potable water and 13 per cent on sewage water provided by the commission.
The new rates became effective last week Thursday, four days before the OUR made the announcement. The regulator said the new tariff regime will remain in effect until 2018. Water rates were last increased by 23 per cent in 2008.
The OUR, in its release yesterday, claimed that the increases were in response to a request from the NWC for a 19 per cent increase. However, the NWC had requested only a 12 per cent increase on its basic rate, although it also sought adjustments to its X-Factor efficiency gains calculations.
The X-Factor calculations are based on increased efficiency by the NWC after implementing projects finances by the K-Factor. The K-Factor is a charge on customers' bills to finance projects to improve efficiency, including reducing the NWC's 68 per cent loss from non-revenue water.
The OUR said that it has introduced new standards, with the new increases, to protect NWC customers, reduce the K-Factor charge on bills by 13 per cent from the current 27 per cent, while allowing for the increases in potable and sewage water rates.
The OUR noted that it has begun the process of separating rates for potable water and sewerage services. The bill impact of the adjustments will be overall increases of 13 per cent on accounts which reflect water and sewerage charges and 18 per cent on accounts which do not pay for sewerage services.
The K-Factor, which appears on customers' bills as a percentage charge, was reduced from 27 per cent to 14 per cent. The K-factor is an OUR-determined mechanism for the NWC to fund approved capital projects to improve service to customers.
"The OUR has expressed disappointment with the recorded gains from the K-Factor to date, and mandated the NWC to comply with a reporting regime on the gains achieved in respect of reductions in Non-Revenue Water (NRW) and energy savings," the release said.
"The OUR has also indicated that it will commission a comprehensive audit of the programme, and has reserved the right to amend the tariff mid-schedule, contingent on the result of said audit," the regulatory agency added.
In an effort to encourage the NWC to operate more efficiently in delivering quality service, new guaranteed standards were also applied and changes made to some existing ones. These include:
* Exceptional meter readings -- where the consumption increases by at least 50 per cent, the customer is to be alerted within one billing period;
* Estimation of consumption -- an estimated bill should be based on the average of the last three actual meter readings; and
* Billing adjustment -- where necessary, customers must be billed for adjustment within three months (i) of identification of error, or (ii) subsequent to replacement of faulty meter.
The OUR has also decided to make the following changes: reduce the time within which the NWC is allowed to verify, repair or replace faulty meters after the defect is identified, from 30 to 20 working days; separate the acknowledgement of customers' written complaints from the investigation of the complaints into two distinct standards.
This means that consumers can now get compensation when the NWC does not acknowledge their written complaints and does not complete the investigation within the specified 30 working days.
Additionally, the OUR said that the NWC is to provide the customer with an update within the specified 30 working days, should the investigation not be completed within that period.
There are also adjustments in regard to defining all the instances in which a disconnection is deemed to be wrongful, which include: no overdue amount being on the account; the account being under investigation by the OUR or the NWC, with only the disputed amount in arrears; and increasing the number of standards that attract automatic compensation from four to seven, which means that for seven standards, no claim form needs to be submitted by the customer when there is a breach, for the relevant compensation to be applied.
In June, during the sectoral debate, minister of water, land, environment, and climate change, Robert Pickersgill, said that the tariff submission was based mainly on the NWC's efforts to expand and improve the provision of potable water and sewerage services to the Jamaican people.