ETAPA analyzing rates and subsidies for drinking water

Through the end of the year, the Telecommunications, Drinking Water and Sewerage Company (ETAPA EP) will be analyzing a revision to the drinking water rates in Cuenca.

José Luis Espinoza, manager of ETAPA EP, confirmed that a tariff study is underway and that the company currently subsidizes this service to all users.

According to Xavier Ortiz, in charge of the Sústag Potabilization Plant, the third largest in ETAPA EP, drinking water costs about 80 cents a cubic meter (m³) to treat and provide; it currently sells it for about 40 cents a cubic meter. Ortiz explained that the Potabilization process uses products such as chlorine gas and aluminum sulfate brought from Guayaquil and polymers that come from Germany, that account for the bulk of the cost of treating the water.

The last rate increase occurred in May 2015 and rose between 5% and 98% for the urban and peri-urban urban sector. The highest number of users are in the residential sector, with about 120,000 connections.

Before the last increase, a family of four that consumed up to 20 m³ per month paid on average $8.55. After the increase, that rose to $16.50, or about 98%.

After one year, the increase provided ETAPA EP increased income of about six million dollars. With that, it was possible to somewhat balance the finances of the municipal institution.

Now, according to Espinoza, “the idea we have is that in the future people who have less income should not be affected by any change that can be made at the rate level.”

“We have to change the language, we always talk about increasing rates and the truth is that we should think about how we reduce subsidies, because ETAPA subsidizes all citizens equally,” he said.

He also said that there are changes in the regulations of the Water Regulation and Control Agency (ARCA), as new intervals are established in the rates. Therefore, it is necessary that those of ETAPA EP be fixed according to these modifications.

The established consumption categories are five: residential, commercial, industrial-construction, special (public institutions) and special discount (institutions with a social purpose).

According to the calculations and regulations that ETAPA EP manages, each of these has specific segments of consumption, fixed availability charges and variable charges.

Consumption refers to the amount in m³ used. The availability charge implies the fixed cost to be paid, regardless of whether or not you use the service. The variable charge is the price to be paid according to the amount of water used.