Bloomberg: Suez Starts ‘Social’ Water Rates in Northern French City

September 12, 2012 | General RCAP News

RCAP finds this concept very interesting. We know it would probably never be accepted in the United States, but it's an interesting thing to ponder nevertheless.

Suez Environnement (SEV), the second- biggest waste and water utility, will begin charging residents of the northern French city of Dunkirk variable water rates that depend on income, size of household and usage.

Starting next month, residents’ water rates will be based on how much they consume as well as financial resources, the Paris-based company said today in a statement. One of President Francois Hollande’s campaign promises was so-called social tariffs to make water, natural gas and power more affordable.

An official at the utility said details about the rates would be provided Sept. 21 when the system is inaugurated with the municipality. Under the contract, Suez provides water to about 220,000 households in 27 municipalities around Dunkirk.

French water contracts are being signed at lower rates, Suez Environnement and larger rival Veolia Environnement SA (VIE) have said. Hollande, elected in May, promised to make water and other utilities less costly for low-income families. The government has unveiled draft legislation on power and natural gas rates, and said water will come later.

In Dunkirk, water rates will be lowest for initial volumes deemed “essential,” then rise for what the company called “useful” water and still higher for even greater volumes that some households may use, according to today’s statement.

The rates will then be further adjusted depending on household income and the number of occupants in a household, Suez Environnement said. This is the utility’s first such contract that includes this measure, it said.