Taiwan Considers Water Price Hike to Address Financial Losses

Taipei: Taiwan Water Corp. (TWC) is contemplating a price hike in water rates to tackle increasing financial losses and plans to deliver a pricing review report to the Ministry of Economic Affairs by the end of March. According to Focus Taiwan, the state-run utility aims to secure financial support or adjust pricing strategies while attempting to minimize the impact on residential users. The report reveals that TWC currently incurs a loss of NT$2.45 (US$0.07) per cubic meter of water sold. Taiwan's water rates have remained stable for 31 years under a four-tier pricing structure. The current rates stand at NT$7.35 per cubic meter for up to 10 cubic meters of water, NT$9.45 for 11 to 30 cubic meters, NT$11.55 for 31 to 50 cubic meters, and NT$12.075 for consumption exceeding 50 cubic meters. TWC's preliminary proposal suggests maintaining the first-tier rate, moderately increasing the second and third tiers, and introducing larger hikes with new brackets for the fourth tier. Initial estimates suggest that at least 60 percent of consumers would not be affected by the proposed changes. The final decision on any pricing adjustments will be made by the Executive Yuan. In 2024, TWC reported a post-tax loss of NT$3.94 billion, with expectations of losses growing to NT$5.93 billion in 2025. The company cites rising costs, including depreciation, interest payments, and efforts to reduce water leakage, as significant financial pressures. In January 2025, Premier Cho Jung-tai urged the public to accept "fair" water pricing, while Economics Minister Kuo Jyh-huei instructed TWC to submit its pricing adjustment review by the end of March. Another initiative under consideration is a water quality-based pricing model, which would introduce premium pricing for higher-quality drinking water, providing an additional revenue stream for TWC. The proposal involves installing water purification equipment at the consumer level, allowing households and businesses currently using private filtration systems to access certified purif ication services directly from TWC. Sources familiar with the matter indicated that TWC's in-house water quality testing capabilities would ensure compliance with drinking water standards. However, the feasibility of the system and its impact on the overall water distribution network require further evaluation.