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Regulatory agency proposes reduction in water rates

April 10, 2014

The Public Services Regulatory Authority (ARESEP) will submit in April  a proposal to reduce water rates for customers of Costa Rica’s Water and Sewer Institute (AyA) and the Public Service Company of Heredia (ESPH). Customers who get their water from municipalities may not be affected.

The new rates follow a reduction in the annual fee ARESEP charges public services agencies.

The Comptroller General’s Office this year ordered ARESEP’s Water Department to instruct AyA and other providers to pass on those savings to customers. If approved, the minimum monthly rate for AyA customers would drop from ₡1,582 to ₡1,433 ($2.98 to $2.70) and for ESPH customers from ₡873 to ₡853 ($1.65 to $1.61).

The proposed rates will be discussed at a public hearing April 2 at 5:15 p.m. at ARESEP facilities in Escazú, southwest of San José. The meeting will be broadcast live in courthouses around the country.

In April, ARESEP also will propose a reduction in rates for the industrial sector. Under Costa Rican legislation, business-sector rates subsidize the residential sector, and businesses can pay up to four times more than residential clients, depending on the amount consumed.

“The adjustment aims to improve competitiveness, to promote investment, and to boost employment, exports and tourism,” the regulatory agency said in the proposal released Friday.

In order to reduce the rates, ARESEP recommended AyA apply a fixed rate of ₡1,000 ($1.90) per cubic meter when a customer reaches 10,000 cubic meters. Currently, customers pay ₡1,663 ($3.14).

The plan stipulates that the reduced rate only will benefit large industrial customers that consume more than this amount of water per month.

According the regulatory agency, AyA’s administrative and operational costs to meet this demand is lower compared to other customers. Consumption by big companies accounts for only 2 percent of total consumption in the industrial sector.

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