Israel spells out 2010 tariff plan

The Israeli government is planning to phase in a 40% increase in the country’s water tariffs over the course of 2010.
The first increase – by some 25% - will be implemented on the 1st January. A further hike of 13% compared to the current level is scheduled for July, with the final 2% increase scheduled for the end of the year. The current average water tariff in Israel is NIS 2.80/m3 ($0.74/m3).

Despite welcoming the planned increase, Mekorot CEO Ido Rosolio believes it falls short of providing adequate cost recovery for Israel’s state-owned bulk water supplier. "An even larger price increase is necessary in order to cover the higher cost of desalinated water and the necessary upgrades to the water distribution infrastructure in the coming years," Rosolio indicates.

The impact of increased tariffs will be softened by the government’s decision to suspend the controversial drought tax between January and April 2010. The tax was first introduced in July 2009.