Impact assessment of the newly prepared/adopted legislation in the field of water supply and sewerage on household income

Submitter: Ernst & Young, s. r. o.

Project duration: 4–9/2016

 

Project description: The aim of the study was to comprehensively evaluate the impacts of each changes proposals to the water and sewerage legislation, which are based primarily on the requirements of the Water Framework Directive (Directive of the European Parliament and of the Council No. 2000/60/EC). The new legislation proposals include changes in the permissible values and fees for surface/groundwater consumption, definition of emission limits in waste water and restricted utilization of WWTP sludge on farmland. Planned changes in the law would affect the price of water and thus the final consumers  households. The study focused on analysing the impact of legislative changes on the lowest-income households, while taking the regional disparities into account (household income, water and sewerage prices). The analysis also included the magnitude of the municipality, the catchment area to which it belongs in the case of surface water abstraction, the current status of WWTPs and other variables which vary by region. Overall, impacts for more than 50 municipalities in all regions of the Czech Republic were modelled. A detailed model based on the current status and the water and sewerage level was created for each city. Subsequently, individual partial amendments to the legislation were introduced to the model, which led to the calculation of additional costs and thus the increase in the water and sewerage costs.

 

By carrying out the analysis it was found that the adoption of the planned legislation would have an impact on the increase of the share of water and sewerage expenditures on lowest-income households falling with the first decile (with income up to CZK 6,000 per person) from an average of 4.09% by 2015 to 4.56% in 2023 after the adoption of all planned and forthcoming legislative changes. For households with incomes between CZK 6,000 and 8,000 would this ratio increase from the original 2.81% to 3.42%. The envisaged changes would result in household budgets being burdened on average by 0.4–0.5% of total revenues. The analysis further showed that the most significant effect on the increase in water and sewerage costs would be the setting of emission limits for waste water discharges where a number of currently used sewage treatment plants would have to undergo extensive refurbishment to technologically achieve the level required by law.

 

Part of the results was presented and published in the conference proceedings: MACHÁČ, Jan–ZEMKOVÁ, Lenka. How much extra will households pay for environmental improvement? Impacts of water and sewerage legislation in preparation on incomes of the poorest households in the South Bohemian Region (pdf). In MATĚJOVÁ, Lenka (ed.) Proceedings of the 21st International Conference Current Trends in Public Sector Research 2017. Brno: Masaryk University, 2017. pp. 305–312. ISSN 2336-1239. ISBN 978-80-210-8448-3

 

Contact person: Jan Macháč, machac (at) ireas.cz