Development And Reform Commission Plans To Push Water Price Marketization Mechanism

The water industry, which is highly regulated by local governments, is expected to usher in fundamental changes in the price formation mechanism.

Shanghai Securities News reporter learned that the NDRC is brewing the mechanism of marketization of water price.

Analysts said that the marketization of water prices will help improve the profitability of Listed Companies in the water sector.

Reporters learned that the national development and Reform Commission price department held a symposium on water price adjustment cost work in Beijing last month, listened to the opinions of representatives of a large number of large cities in the country, and discussed with the price departments in these regions.

At the meeting, the NDRC also produced a way to disclose the cost of water price and seek advice from all over the world.

It is understood that the participation of this forum is the price departments and water enterprises of the national representative cities, including Beijing, Shanghai, Nanjing, Zhengzhou, Shenzhen, Guiyang, Lanzhou and other regions.

The main contradictions and problems reflected by representatives from different parts are basically the same. The main problems are that Water Service Company are facing serious problems of serious policy losses due to high price control. Water enterprises should bear the social responsibility of water supply. As the government maintains low water prices, the water supply and drainage enterprises are suffering serious losses, the funds for reconstruction of the pipeline network are seriously insufficient, and the asset liability ratio is high.

The NDRC believes that the main purpose of the meeting is to: first, better promote the water price increase and the cost of publicity.

Second, understand the specific difficulties of enterprises.

Third, rationalize the price mechanism.

The price bureau of the NDRC said that in order to make the water price adjustment work positively and reliably, and make the price adjustment more smoothly, no good pricing mechanism could not be done, otherwise the water enterprises would suffer serious losses and the financing of the listed companies would be difficult to carry out.

The next step will be to study the formation mechanism of promoting the marketization of water price.

Since last year, a number of cities across the country have raised the price of water. There are two reasons for this: first, the overall low water price does not reflect the scarcity of water resources and the cost of water environment management, resulting in serious waste, which is not conducive to raising the awareness of saving water for residents. Two, the low water price leads to the pressure of water supply enterprises to face losses in operation.

It is understood that the above problems also lead to poor profitability of listed companies. From a quarterly report this year, the listed companies in the water sector are generally not profitable.

For example, Qianjiang water conservancy's net profit in the first quarter is only 5 million 360 thousand yuan, Hongcheng water industry is 4 million 450 thousand yuan, and ST is 3 million 240 thousand yuan.