The City of London is asking citizens to pay the price for water conservation.

An 18 per cent drop in residential water consumption since 2001 is costing the City lost revenue. While the decrease is good for the environment, officials said the short-term effects are affecting their budgets.

This week, the City responded by increasing water rates by eight per cent and wastewater treatment rates by nine per cent. This translates to about $62 more per year for a typical home, according to a press release from city hall.

“This is the double-edged sword of conservation,” said Pat McNally, general manager of environmental and engineering services and city engineer. “The customer gets full credit for their conservation efforts. But at the end of the day, the average household is paying $280, which is not that far off from what they were paying in 2001.”

The water conservation efforts also come at a crucial time when London is playing catch-up with its infrastructure maintenance.

Even though water consumption has fallen, the City still has to pay fixed and unchanged maintenance costs, according to Roland Welker, manager of the water engineering division for the City.

“Irrespective of how much water is flowing through the pipes, you have to maintain the same amount of maintenance,” he said. “What we’re saving in water costs and chemical costs doesn’t necessarily offset the [maintenance costs] in the short term.”

McNally said much of London’s pipes, valves and storm drains have been a “neglected utility” for years, with about 1,500 kilometre of pipes and infrastructure deteriorating beneath the city.

“Some of that sewer pipe goes back to the 1800s and needs to be cleaned and maintained,” he said.

City planners struggled with raising rates for water and wastewater services as a way to pay for city-wide maintenance. But with city hall asking for a zero per cent budget increase in 2010, officials were left with little option but to raise the cost.

“It’s always been a really tough dilemma,” said John Braam, division manager of water operations for London.

Water management alone costs the City $1.8 billion per year, Braam said.

The wastewater system, which includes sanitary and storm sewers as well as water treatment plants, costs another $3.6 billion.

While Londoners are consuming and paying less for water, the City is facing a widening “infrastructure gap” — a turning point in city maintenance when investment becomes necessary to curb an aging infrastructure problem.

In 2007, City officials announced an 18-year infrastructure strategy, which budgeted $750,000 per year for pipe replacements alone.

The money was used to target lead pipes used in many old homes in London. By April the following year, these homes saw lead concentrations fall by 40 to 50 per cent.

In 2010, the City will spend another $8 million on contract labour to make infrastructure repairs, using part of the money from the water and wastewater rates to pay for it, according to Welker.

“While we would like to give a break to the homeowner, in the long run I hope the homeowner will thank us for maintaining a water and wastewater system that meets their needs.”

Mary Ann Hodge, riding association president for the Green Party in London North Centre, said the City should look to alternatives for funding instead of passing the buck to conservationists.

“Tax things that are bad, not things that are good. The City needs to find ways to look at other forms of revenue […] so we’re not necessarily penalizing those who are in lower income brackets.”