According to the federal water regulator, the increased revenue from higher water tariffs will be utilized to settle debts, replace old pipes, valves, and fix leaks in the distribution system. Charles Santiago, the chairman of National Water Services Commission (Span), emphasized that the tariff hike is not intended to be a burden on consumers or to generate profit for water utilities.
The new prices, which average about 22 sen per cubic meter, still do not cover the average cost of providing treated water, which is RM1.75 per cubic metre, Santiago said. Some state water companies have accumulated significant debt, with a substantial portion owed to Tenaga Nasional Berhad (TNB) for unpaid electricity bills for water processing plants, and the current tariffs are insufficient to pay off this debt.
Santiago highlighted the urgent need to increase the capacity of existing water treatment plants, replace 30-year-old pipes, and build new water treatment plants. He stressed that these measures are investments for the future and not meant to burden anyone. Average domestic water consumption is high at 230 litres per person daily.
Water utilities have been instructed to provide Span with a detailed list of projects that will be implemented with the new revenue, and these details will be posted on the respective operators’ websites. In addition to addressing current needs, Santiago pointed out that the increased revenue will also help prepare the water sector to cope with climate change, which may lead to a decline in raw water sources.
Santiago emphasized the importance of investing in infrastructure to manage future climate emergencies. He also mentioned that some states have agreed to introduce special programs to support families in the lowest 40% income bracket who would be burdened by the higher tariffs. According to Santiago, the water tariffs will be reviewed again after three years.
