‘We’re paying 300% more than what we should for water – something has to be done’

Likud MK Amsalem has made it his mission to lower water prices.

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August 20, 2015 15:51
3 minute read.
Tap water

Tap water [illustrative]. (photo credit: INIMAGE)

 
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Knesset Interior Committee chairman David Amsalem (Likud) set a goal for when the Knesset returns from its summer recess: Make sure water prices are significantly lowered.

Following a meeting of his committee regarding a water corporation in the north, Amsalem began researching the topic, and found that Israelis are being charged an average of NIS 9.20 per cubic meter of water, which is over three times the average production cost.

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Amsalem explained on Thursday that water has a production price. For desalination, which makes up about 40 percent of the market, it is around NIS 3 per cu.m. , and for ground water, it is about 70 agorot per cu.m.

“By that average, the price should be NIS 2.20-2.30 per cu.m., maybe NIS 2.50 because of changing factors, but how did we get to NIS 9.20? What happened?” he wondered, exasperatedly. “Something has to be done; it doesn’t make sense.”

“When I started looking into the issue, I found two things: First, we don’t have a water problem anymore, because of desalination. In fact, we have a surplus. Second, water is extremely overpriced and we are being charged for things that have nothing to do with water,” Amsalem said.

The Likud MK pointed to several extra charges that he deemed unnecessary.

Amsalem said that water used for agriculture costs NIS 2.40 per cu.m., and the high price of water for other uses makes up for that subsidy.



“The state should subsidize water for agriculture, but not through our water prices. A person who lives in [Jerusalem’s] Neveh Ya’acov or Haifa shouldn’t subsidize farmers’ water,” he said.

Cities that produce their own water, meaning that they have their own wells, are charged a NIS 300 million tax by the national government, which the Finance Ministry uses for things unrelated to water, he said.

In addition, after the 2001 Water and Sewerage Corporations Law passed, reservoirs were transferred from municipal ownership to the various water corporations. Then, the municipalities charged the water corporations property taxes, Amsalem explained.

Another charge is value-added tax on water.

“No matter what angle from which I come at this issue, the price of water is paying for half of the country,” the Likud MK grumbled. “At the end of the day, there is a cost for water production and for distribution, but we can’t get to a price that is 300% of the production cost.”

More than 50% of Israel’s water comes from man-made resources, such as desalination and sewage recycling. This has enabled the Water Authority to significantly reduce its pumping of natural fresh water resources, such as those in Lake Kinneret (the Sea of Galilee), according to the Water Authority.

Desalination is expected to account for about 600 million cu.m. of the country’s annual water production once an additional facility in Ashdod opens later this year. By far leading the world in reclaiming wastewater, Israel treats more than 90% of its sewage – most of which is then reused for watering agricultural fields.

Although Israel is no longer experiencing a water shortage, due its increased reliance on desalination and treated wastewater, operation of desalination facilities is no small expense. Desalination requires a huge amount of electricity, causing the resultant water to be much pricier than natural water sources.

After dropping 5% in 2014 in comparison to the previous year, water tariff rates fell about another 10% on January 1, 2015, and decreased slightly again on July 1, 2015.

Amsalem has been holding meetings with the Finance Ministry, Water Authority, the Mekorot national water company and others, and plans to combat what he called exorbitant pricing by holding Knesset Interior Committee meetings on the issue as soon as the Knesset winter session begins in October.

“The committee doesn’t have the authority to make decisions,” he explained, “but we have the power to pass laws and enforce laws.”

A legislative committee’s real power comes from the public, Amsalem said.

“Most of the public doesn’t know what it is paying for. Our power is that we will bring this to the public discourse. Once the public is exposed [to the issue], the minister [Energy and Water Minister Yuval Steinitz] will not be able to ignore it,” he said.

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