Under a fixed charge tariff structure, consumers pay a certain amount independent of quantity and quality of wastewater produced. In the absence of metering, fixed charges are the only possible tariff structure. This can be the case for example in multi-story apartment buildings where the different renters do not have metered connections to the sewerage systems. The fixed charge itself can vary across households or discharger classes depending on their characteristics. For example there can be different fixed tariffs based on different types of dischargers (industry, agriculture, households, etc.), on property values (size of floor space), number of people living or working in the connected building. Another common approach is to charge different monthly fees depending on pipes’ diameters used to connect the customer to the sewerage or distribution system.

The benefits of the fixed charge tariff system lie in its simplicity; however it does not provide any incentives for water conservation and pollution prevention. An Example for a differentiated fixed charge tariff is given in the textbox below.

Fixed Charge Tariff in Uganda

In Uganda in 1995, tariffs were set by the National Water and Sewerage Corporation, which had a monopoly over service provision at that time. Water charges included all operations and maintenance costs, depreciation and capital costs and also social equity. As of April 1995, un-metered residential consumers paid flat rates that were based on the number of taps. The table below demonstrates the difference between metered and unmetered connections.

In Ugandan Shillings: US = 1,050 shillings (1996)

Table 2: Fixed Charge Tariff in Uganda

Source: IRC 2003