Why do businesses pay for water?

The levels of rainfall in Scotland might make it seem strange that customers have to pay for water – if so much falls from the sky, why does it have a price attached? Your constituents might have asked you about water charges, since businesses are now billed separately from their business rates.

The reason that water has a cost is that it goes through a complex journey before it is suitable for human consumption, each stage of which contributes to the charges your constituents pay.

The water cycle

Rain and river water is collected in Scotland’s 678 reservoirs, from which it is pumped to Scottish Water’s treatment works. Scottish Water is the nation’s biggest electricity user, due in no small part to the energy required to pump all this water to the works.

The water is then filtered and cleaned so it’s suitable for drinking. After it’s been treated, it’s pumped to storage tanks – but demand means that it’s rarely stored for longer than 12 hours.

Once water has been used, it’s drained into the sewers where it’s again taken for treatment. Drainage water from roads and buildings is also processed, as well as industrial waste water. It’s filtered, strained and thoroughly cleaned – processing waste water is even more expensive than treating water. Once this process is complete, the cleaned waste water is fit to be returned to nature.

Billing for water

Scotland pioneered a fully competitive retail water market in 2008, to encourage keener pricing, better customer service and greater innovation. This means that all non-household customers – businesses, public sector organisations, charities and so on – have the opportunity to change their water supplier if they’re not happy with the price or service they currently receive.

The introduction of wide-spread water metering also means most customers only pay for what they use, rather than a fixed cost based on the rateable value of the property. That not only made it a fairer way of charging, but also provided customers with information to put them in control of their water use.

By separating water bills from business rates, customers should be able to see much more clearly the details of what they’re paying, and the service they receive in return. If your constituents don’t understand why a particular charge has been made, and they’re a Business Stream customer, they can contact us on 0845 602 8855. 

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