Can the Commission clarify the mechanisms used to estimate the recovery of costs for water services as outlined in Article 9 of the Water Framework Directive 2000/60/EC(1)
according to the economic analysis in Annex III. Are any mechanisms in place whereby consumers can challenge the costings if they seem unusually high?
Under the Water Framework Directive (WFD)(2)
Member States are required to set up, by 2010, water pricing policies that serve the dual purpose of recovering the costs of water services and giving users of services an incentive to use water in a sustainable way.
The mechanisms for estimating these costs (financial costs as well as environmental and resource costs), enforcing such cost recovery and estimating the adequate contribution of different water users must be part of the River Basin Management Plans (cf. Article 13 WFD) to be established by end 2009. They must be then reported to the Commission by the Member States by 22 March 2010.
Whilst the WFD sets out the principal obligations, it is for the Member States to develop the details of their water pricing policy in line with subsidiarity.
To support this work, the Commission initiated and organized the preparation of an informal guidance document and other supporting tools to implement the economic instruments of the WFD. This has been carried out in close cooperation with the Member States(3)
When developing the River Basin Management Plans, Member States are required to consult the public. Draft River Basin Management Plans shall be made available for consultation in December 2008. At that moment, interested parties can express their views on the planned measures including those selected for the recovery of costs.
The WFD states that Member States may take into account social and economic considerations when establishing the level of cost recovery for different users (cf Article 9.1). Moreover, Member States can exempt specific water use activities from the provisions of Article 9(1) where this does not compromise the achievements of the objectives of the Directive (cf Article 9.4).
Furthermore, transparency of water pricing structures is crucial for such economic instruments to be effective. The WFD does not itself prescribe provisions as regards consumer protection, as this would be outside the scope of its legal basis. In line with subsidiarity, it is for the Member States to set up appropriate mechanisms. Physical persons can however seek redress via Directive 93/13/EEC on unfair terms in consumer contracts(4)