Industrial units in Chennai were in for a nasty surprise over the last weekend with Metrowater sending out notices, doubling water charges.

Multiple sources in industry confirmed that the charge has been doubled to about ₹ 120 a kilolitre. Large units and continuous process units that are water guzzlers are the worst-hit. Though for now the utility has cut back on supplying water to industry because of shortage, the move to hike prices will push up the overall water costs. When water supply resumes, the higher costs will have to be borne, industry sources said.

Industry associations in Manali have represented to Metrowater, the Chennai Metropolitan Water Supply and Sewerage Board, to reduce costs, said a senior executive in a petrochemical unit.

S Ilanahai, President, Chemical Industries Association, said the utility has hiked the price from about ₹60 a kilolitre to ₹120. Ideally, the increase could have been in stages for the industry to attempt to absorb the cost. But it had unfortunately chosen to double the charge at one go.

Desalination plants

Manali, an industrial suburb north of Chennai, has a cluster of chemical, petrochemical and petro products units. Two of the largest units, IOC’s oil refinery Chennai Petroleum and Madras Fertilizers have their own desalination and water recycling units and are relatively insulated from the hike. But dozen other units use about 10,000-15,000 kilolitres of water daily.

On an average, a unit using about 1,500 kilolitres of water daily will be impacted by about ₹ 2.5 crore a year.

Private suppliers

Metrowater supplies just 5–10 per cent of the industry’s needs now because of the shortage and to maintain drinking water supply. But the hike by the utility will mean that private suppliers who now cater to industry will soon jack up prices, said a senior executive.

Water tanker suppliers typically keep their prices about ₹5–10 lower than Metrowater charges.

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