Mr. Paul O'Donoghue:

Standing charges comprise a quite common feature of utility services. It is typical for a telecommunications, gas or electricity bill to include a standing or fixed element. This reflects the fact that quite a bit of the cost in utility industries is incurred irrespective of whether anybody uses the service. Irrespective of whether one uses the telephone, turns on the tap or uses the cooker, significant costs arise for the industry. In the water industry, these costs are associated with maintaining reservoirs, adding chemicals to water to make it of drinking standard and using energy to pump water between places. Our expectation is that there will be a fixed element to the bill.