The case for separate water service charges and how this will work

Friday, 22 May 2026

Will Peet is board chairperson of Wellington’s new water service provider, Tiaki Wai.

OPINION: For years, most of us have taken water services for granted, without knowing what they cost or how they are paid for.

That’s changing with the new water organisation, Tiaki Wai, being established.

From July 1 2026, Wellington, Porirua and Hutt Valley property owners will start paying for water services directly to Tiaki Wai instead of through their council rates.

About one quarter of householders didn’t know their council rates covered drinking water, wastewater or stormwater when we asked in December. Of those who did know, most had no idea how much goes towards water services and how that is calculated.

That is changing as we transition to Tiaki Wai, as people are now learning more about the true cost of operating and maintaining the networks of pipes, pump stations, reservoirs, treatment plants and other essential water assets.

Tiaki Wai is being established to fix long-standing, region-wide issues caused by decades of underinvestment in water infrastructure. Over time, with the right level of investment, we aim to deliver improvements to water services – fewer leaks, more reliable services, and better outcomes for our environment.

Part of establishing an independent water organisation with the mandate to decide where, when and how to invest, is separating water services charges from council rates.

In practice, that means people will get two bills – one for water services and one for council rates. People are not being charged twice.

In the next financial year (starting July 1) property owners will be billed every three months for a quarter of the annual charges – as happens with council rates. The bills will be delivered the same way as council rates bills. And when the first water bill arrives at the end of July or the first week of August, you will have options for how to pay.

Council rates will reduce as water services charges are removed from the rates bill.

However, both council rates and Tiaki Wai water services charges will increase in 2026/27, meaning the total of both bills will be higher than the 2025/26 rates bill. Tiaki Wai is in the process of finalising budgets and charges for next year and will publish details before the end of June.

For the first, transition, year Tiaki Wai is inheriting systems currently used by the four councils to set water services charges. This means it’s now visible that people in each city are paying different amounts for the same services. Each council has a different system, based on a mix of capital value and fixed charges, and charges are only based on water usage where a customer already has a water meter.

For example, charges for drinking water supply in Wellington and Upper Hutt are a combination of a fixed charge and a variable amount related to the capital value of your property or, if you are one of the few who have a water meter, a combination of a fixed charge and a charge related to how much water you use. In Lower Hutt, there’s a fixed charge plus usage charges for those with a meter, while in Porirua, there’s a fixed charge for those without a meter, and a usage charge for those with a meter.

Wastewater charges are a fixed charge in Lower Hutt, Porirua and Upper Hutt, but in Wellington are a combination of a fixed charge and a variable amount related to the capital value. Stormwater in all cities is a combination of a fixed charge and a variable amount related to the capital value.

Tiaki Wai acknowledges there’s little connection between delivering water services and the capital value of a property and plans to move away from linking charges to capital value in coming years.

Many people are interested in paying based on water use. That requires a region-wide metering system, which will take time to introduce. Work is under way, but we are not advising households to install meters individually ahead of a coordinated rollout.

Even when everyone has a meter, it’s expected there will still be a fixed component to the bill – similar to electricity lines charges.

We’ll have a clearer picture of the water meter rollout towards the end of 2026, after we’ve done a full review of the current cost estimates.

Our intent is to ensure water services charges are consistent for similar properties using comparable services, regardless of location, promoting fairness and equity in charging across the region.

Switching to more consistent pricing or “harmonisation” is not as simple as moving everyone to a single regional price average. It will take several years to work through how to align different charging mechanisms and how quickly differences in charges across cities should be aligned, taking into account the impact on some households and businesses.

As we develop the pricing system, there will be a consultation process, giving people the chance to have their say, before decisions are made.

There’s also the practical challenges of building a billing IT system. Tiaki Wai has interim support from councils for billing until we can get our own system built and operating.

How we set charges and the inputs into how much we charge will be subject to Commerce Commission scrutiny.

This transition won’t happen overnight, but establishing Tiaki Wai is an important step toward a clearer, fairer charging system, and more reliable water services for our region.