Water prices to rise almost 50% by 2011

Household water prices will go up 25% on Jan. 1, 2010, and will rise by another 16% on July 1 and then by 2% more on Jan. 1, 2011. The Water Authority Council officially approved the price hikes last Thursday. These amounts are less than originally asked for by the Finance Ministry.

The authority decided to include the true cost of supplying, transporting and distributing water in the updated price, which will also include the cost of buying desalinated water and the cost of upgrading municipal water and sewage infrastructure.

The consumer price will be the same all over the country, a change from the original proposal, but municipalities and local water companies will pay different prices based on maintenance and transportation costs. The price differences will be up to dozens of percent.

New home buyers have good news: They will not be required to pay for their new local water infrastructure directly, for now.

The council did not provide any solution for the Mekorot water company, which is facing an expected NIS 750 million cash flow deficit in 2010 as a result of the water reforms and the lower than requested rates.