Provisions in the State Water Policy
a. As per Section 12 (1) of the Act, the Authority is required to work according to the framework of the State Water Policy.
b. The State Water Policy has the following provisions relating to water tariff
Bulk Water Supply and Water Charges
A transparent system of water tariffs that recuperates the cumulative cost of providing water services from all water user entities in all categories of water use shall be established by the State. Water charges determined on the basis of the approved water tariff system will be levied on a volumetric basis.
Water charges shall be assessed and paid at each appropriate level of management and service provision. They will be sufficient to pay all administration, operation and maintenance costs of the delivery and use of water and to recuperate all or portion of the capital costs of the infrastructure needed for the storage, delivery and use of that water.
Water charges shall be assessed to WUAs and other water user entities on the basis of the volume of water delivered at their respective off-takes. WUAs and other water user entities shall be responsible for determining internal water charges and assessing each of its members to obtain the funds required for paying water charges, carrying out necessary maintenance and for any other purpose approved by the membership.
Cost-effectiveness of State Water Services
State department and water service providers and the river basin agencies shall optimize the cost of service including establishment, works, materials, energy and other costs and maintain transparent accounts of the amount and sources of revenues and costs and their allocation to various functions and services.
Financial and Physical Sustainability
There is a need to ensure that the water charges for various uses shall be fixed in such a way that they cover at least the operation and maintenance of providing the service initially and a part of the capital costs with interest subsequently. These rates shall be linked directly to the quality of service provided. The subsidy on water rates to the disadvantaged and poorer sections of the society shall be well targeted and transparent.