On 1 January 2025, three new charges will appear on customers’ water bills, while others will disappear or change. The aim is to strengthen the ‘polluter pays’ principle and balance the contributions of those responsible. Dorothée Laperche, Head of the Water/Health-Environment Section of Actu Environnement, explains the changes.
The transition to 2025 marks the entry into force of a long-awaited overhaul of water charges. Initiated by the 2024 Finance Act, this revision was initially intended to rebalance the burden on the various contributors and reinforce the polluter-pays principle. However, under pressure from certain stakeholders, some provisions have been postponed or have not yet seen the light of day – including the planned increase in charges for agriculture (irrigation and diffuse pollution levies).
However, the overall architecture of the reform remains unchanged, with the abolition of three charges (for domestic pollution, for the modernisation of domestic collection networks and for non-domestic collection) and the creation of three new ones: the charge for drinking water consumption and the two charges for network performance, one for drinking water and the other for collective sewerage. Some charges were adjusted: the non-domestic pollution charge and the water abstraction charge.
A decree and a series of orders were then issued to clarify implementation: the procedures for setting the charges (first order in July, amended by a second order published on 26 December), the impact on bills, the maximum lump sum for performance charges and the procedures for managing the charges that have been abolished.
New charges to promote energy efficiency
The new charge for drinking water consumption will apply to all subscribers to the service, with the aim of promoting energy efficiency. Only livestock farms with a special meter will remain exempt. It will be up to the distributor to identify the subscribers who can be exempted and who have a double meter,’ explained Virgine Mistretta, water charges instructor at the Loire-Bretagne water agency, during a webinar presenting the reform. Those who are able to distinguish between domestic consumption and consumption linked to animal husbandry. Also noteworthy is the removal of the 6,000 m3/year cap for industrial customers connected to the network. The charge is calculated on the basis of the cubic metres of water billed during the current year, multiplied by the rate decided by the board of directors of the water agencies (or water boards).
For the two new performance-based charges, the idea is to modulate them according to indicators that reflect the proper operation of the services. For drinking water, the charge will be based on the leakage rate and the local authority’s knowledge of the network. The maximum increase will be one euro per cubic metre (indexed to inflation).
For leakage, two coefficients are calculated (data for year N-2 from Sispea): the primary yield and the loss rate (ILVNC coefficient in m3/km/day), and the water agency will apply the one that is more favourable to the local authority. As Virgine Mistretta explains, “the calculation of yield is not necessarily appropriate for a small local authority, so we will give priority to the ILVNC, which takes into account the density of subscribers on the networks”. For asset management, five headings (N-2 data from Sispea) are considered: the existence of an updated network plan, the known length of networks in terms of diameter and materials, the known length of networks in terms of age, the existence of a system (GIS) for recording leaks, and the existence and implementation of an action programme. “The points obtained for each item are taken into account to calculate the overall coefficient,” Virgine Mistretta explains. In 2025, the modulation coefficient will, by default, be the most favourable coefficient for local authorities when calculating the amount of the levy: all local authorities will be considered as performing well.” The actual calculation will take place in 2027, based on data from 2026.
…and the polluter pays principle
Similarly, the performance charge for collective wastewater systems will vary according to the validation of self-monitoring, compliance and performance of the wastewater system. Within these three axes, depending on the size of the wastewater system, a combination of three to nine different criteria (1) is taken into account (N-2 data from water agencies, water and wastewater boards, water and wastewater treatment plants).
The modulation coefficient varies from 0.3 for an efficient system to 1 for the least efficient. “The weighting will be calculated by the authorities on the basis of the data provided, but it is planned to provide a simulation tool that will allow the coefficient to be estimated,” said Virgine Mistretta.
In addition to the creation of these three new charges, two other existing charges have been modified, including the charge for non-domestic pollution, which is aimed exclusively at industrial companies that are not connected to the network. Those that are partially connected pay the wastewater service charge on their water bill. The non-domestic pollution charge is based on the annual pollution discharged into the natural environment for each pollutant parameter (above a defined threshold). The rates for each parameter are set by the catchment authorities.
The second tax that has changed is the tax on water abstraction. The doubling of the rate required by the Grenelle Law in the absence of an action plan, insufficient yield or a description of the works has been abolished. These elements are now included in the new performance fee. The ceilings have been increased to take account of inflation. At the same time, a minimum rate (floor) has been introduced. For manufacturers, rates will be set by type of use and geographical area.
Another new feature is the introduction of a penalty for unreliable measurement of quantities withdrawn. The rate will increase to 60% if there is no measurement, 40% if there is no measurement and 20% if there is no monitoring.
What will happen to bills?
From 1 January 2025, the three new charges will have to appear on the bills of customers in the “public entities” category, in the same way as the charge for water abstraction, regardless of the period of consumption. The tariffs decided by the boards of directors of the water agencies will also be published on the agencies’ websites. One point to note: from now on, local authorities will have to pass on the service charges to their customers in the form of a surcharge (2) on the price per cubic metre of water sold and/or treated. However, it is expected that there will be differences between the amounts billed and received between two financial years. To take account of this, the law states that local authorities may, if they wish, ‘increase the amount of the underpayment or reduce the amount of the overpayment for the second year preceding the year in which the charge is levied’.
In addition, while domestic pollution charges and charges for the modernisation of collection networks will be abolished, outstanding debts will be phased out after 1 January. At the beginning of 2026, the agency will send out an inventory of all outstanding amounts over 100 euros,’ Virgine Mistretta adds.
The confusion of the 2025 finance law
The reform of the water tariffs was also intended to increase the financial capacity of the water agencies to finance the implementation of the water plan. However, the planned postponement of the increase in the financial room for manoeuvre of the water agencies, and then the condemnation of the draft budget for 2025 by the deputies, have left many questions unanswered… It remains to be seen what decisions will be taken in 2025.
1. For plants between 20 and 200 p.e.: compliance of equipment, overall compliance of the treatment system, no pollution detected.
For plants between 200 and 2 000 p.e.: self-monitoring carried out correctly, compliance of equipment, overall compliance of the treatment system, sufficient sludge production or sludge removal, correct destination of sludge.
For treatment plants with a capacity of 2,000 p.e. or more: Validation of self-monitoring of the treatment plant, validation of self-monitoring of the collecting system, compliance of equipment, local compliance in terms of treatment plant performance, compliance of dry weather collection, compliance of wet weather collection, limitation of direct wet weather discharges, performance indicator, correct destination of treatment sludge.
2. The amount of this supplement is determined for a given year by applying the rate of the fee multiplied by the estimated overall modulation coefficient or by the estimated modulation coefficient per administrative unit, depending on the choice of the payer.
