December 2, 2019
Investment

Government announces average 1% reduction in water rates charged by Aguas Andinas in the Santiago Metropolitan Region

Government announces average 1% reduction in water rates charged by Aguas Andinas in the Santiago Metropolitan Region
The Superintendency of Water Services reached an agreement with Aguas Andinas on rates for 2020-2025.

The government announced that the base rate for drinking water and sewage collection and treatment charged in 2020-2025 by the Aguas Andinas water company, which serves 46 municipal districts in the Santiago Metropolitan Region, will represent a drop of 1%. The reduction will come into effect as from March 2020.

This follows an agreement regarding the company’s discrepancies with the water rate studies carried out by the Superintendency of Water Services (SISS) as part of the Seventh Water Rate Process.

The Minister of Public Works, Alfredo Moreno, indicated that he was very satisfied with the agreement reached with the water company. “In the context of the drought in which the concession companies must absorb the higher costs of producing drinking water, with increases in various important inputs such as energy and labor, and increased citizen demand for service quality, maintaining the level of rates for the next five years means a horizon of stability, contributing to the development and continuous improvement of the quality of the services provided by these companies,” he said.

He added that “this agreement represents a commitment and obligation to implement each and every one of the investments needed to provide water services to citizens in the concession area. Therefore, it is an agreement that does not exempt the company from making the investments, but benefits citizens, because it does not increase the rates and, at the same time, is in line with the water law and the investments the company has to make under the development plan which the Superintendency has to enforce.”

Going into greater detail, the acting Superintendent of Water Services, Jorge Rivas, explained that “the average 1% decrease in rates that will be seen by households served by Aguas Andinas in the Santiago Metropolitan Region reflects two main factors: a 3% decrease in rates for services already provided to citizens and a 2% increase in rates for new services related to the infrastructure needed to address the phenomena of climate change and new environmental requirements, which will come into operation over the next few months. The result will be a 1% reduction in average rates and a city that is better prepared for turbidity and care for the environment.”

It is important to note that the SISS has ordered preventive measures to ensure the quality and continuity of water services to citizens as “part of a policy that the SISS is implementing at the national level, mainly in those areas worst affected by climate change, whether in terms of water shortage, increases in turbidity or other impacts; for Greater Santiago, they envisage the construction of six facilities to store a total of 1,500,000 cubic meters of raw water, an amount that will increase the autonomy of water supply for Santiago from the current 11 hours to 34 hours.”

Investments associated with nitrogen abatement systems will ensure compliance with environmental regulation by improving the quality of the effluents treated at the La Farfana plant, contributing to protection of the environment.

The agreement benefits more than 2 million households in the municipal districts of the Santiago Metropolitan Region that are served by Aguas Andinas.

It should be noted that, after more than a year of work by its teams, the SISS must now start the administrative procedures and issue the corresponding decree so that the rates for the next five years come into force as from 1 March 2020.

Aguas Andinas is a water company controlled by Agbar-Suez, with a concession for production, distribution, collection and disposal services in Greater Santiago and nearby areas. It serves 1,950,626 clients, equivalent to 36.2% of the national total (urban population supplied of 6,791,097 people). The company has a coverage of 100% for drinking water and 98.8% for sewage collection and treats 100% of the wastewater it collects.

Source: Public Works Ministry