Water Rates Likely to Rise Following Electricity Hikes

With electricity rates set to rise by as much as 60 percent next month, the city’s water authority says it may be forced to hike water rates in order to pay its power bills.

Ek Soun Chan, director-general of the Phnom Penh Water Supply Authority, said Sunday he may ask the government to ap­prove a 40 percent water rate in­crease to 500 riel per cubic meter.

“I don’t want to increase it at all,” Ek Soun Chan said. “The price of power is pushing me to raise the price of water.”

An economic adviser for the Council of Ministers said the government would study any re­quest from the water department, but had no comment on the likelihood of it being approved.

Electricite du Cambodge De­puty Director Ouch Tong Seng said Sunday the water de­part­ment will not receive special treatment and will have its rates hiked along with all other industries.

Electricity rates are slated to increase next month. Govern­ment officials said the two prime ministers had postponed ap­proval for the hike until after the July 26 elections for “political” reasons.

EdC Director General Tan Kimvin on Friday announced a 60 percent rise would take effect for nearly everyone except for­eign­­ers, who will see a slight decrease in their bills.

Residences and industries using more than 250 kilowatt amps of power will be charged the riel equivalent of 16.5 cents per kilowatt hour. Public institutions will be charged the riel equivalent of 17.5 cents.

Embassies, hotels, private banks, entertainment clubs, commercial buildings, rental housing, and foreigners will pay 19 cents in US dollars per kilowatt hour, a 9.5 percent decrease.

“The price is lower because EdC wants them to start using our power and stop using generators and reduce pollution in the city,” EdC Deputy Director of Distribution Nou Sokhom said Sunday.

Many factories and businesses use generators because city power is unreliable. Garment industry representatives last week warned that an increase in the rates would drive even more factory owners to use generators.

Bills to be paid in riel will be calculated on the National Bank of Cambodia’s average exchange rate from the previous month,  the EdC reported. Until now, the EdC has continued to base rates on a fixed exchange rate of about 2,600 riel—a move officials say  cost EdC a significant amount of revenue. The riel has been trading be­tween 3,500 and 4,000 for much of the last six months.

Along with the riel’s drop, Tan Kimvin blamed the rising price of oil for the need to raise rates—the first increase since 1994.

According to EdC officials, the utility has lost about $1 million a year since 1995, despite steps to make it profitable. Tan Kimvin said the country’s unstable political and economic situation forced EdC to delay proposed in­creases.

Although several foreign businessmen on Sunday welcomed lower electricity rates, local businesses expressed concern about how it would affect them when the economy is still sluggish.

Phnom Penh residents interviewed Sunday were also worried. At a coffee shop near Inde­pendence Monument Sunday, the main topic of conversation was the electricity rates. Upon hearing water rates might rise as well, customers had only angry responses for the utilities.

“I have so many headaches,” said 57-year-old Kim Vuth. “There is no water to plant rice, my grandsons have dengue. Now they want to raise power and water prices. I am not pleased about this.”

 

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