Palma hotels pay up to nine times less for water with a custom Emaya tariff

PalmaEmaya's water tariff, applied for years to hotel establishments, uses a specific calculation technique that modifies how progressivity is applied in the case of the tourism sector. The analysis of current tariffs, published in 2016, by a former company technician assures that the methodology, "designed for the hotels of Platja de Palma" establishes a consumption recalculation system "two rooms at a time", and generates a false division of expenses that significantly reduces the amount it would have to pay if progressivity were applied.

Emaya's tariffs establish a specific progressive tariff for hotel and similar establishments. The difference compared to domestic consumers is that the tiers are not applied to the entire volume of water consumed by the hotel as if it were a single consumer, but rather the tariff establishes a scale based on blocks of two beds, and in a way, it involves "dividing consumption into multiple small consumers, which means that the progressivity stipulated by the regulations is never or hardly ever applied," states this former technician of the municipal company of Palma.

The tariff document sets the tiers as “consumption up to 5 m³/month per 2 beds”, “consumption between 6 and 10 m³/month per 2 beds”, “consumption between 11 and 20 m³/month per 2 beds” and so on up to the highest tier. This tariff fragmentation technique means that a hotel establishment with high consumption is not treated as a single consumer of thousands of cubic meters, but rather the system establishes multiple calculation units of two beds. According to the consulted former technician, this is the key to the tariff's operation: by dividing the base on which progressivity is applied, consumption is distributed among different blocks and a significant portion of the consumed cubic meters does not reach the higher price tiers.

The same tariff published by Emaya indicates that “the registered consumption will be divided into the corresponding sections and the pertinent price will be applied to each section according to the scale provided in the progressive tariff”. The data analyzed by this former technician show very significant differences between what these establishments would have paid if a progression similar to domestic ones had been applied to them and what they pay with the specific hotel system.

One of the cases studied by this former company employee corresponds to a hotel in Platja de Palma with 240 places and a consumption of 3,760 cubic meters. According to the calculations provided, if this same volume of water had been billed applying domestic progression, the amount would have been 21,225.60 euros. In contrast, with the actual tariff applied by Emaya, the payment is 2,356 euros (see attached graph).

A second example is that of a hotel with 180 places and a consumption of 3,240 cubic meters. In this case, the application of domestic progression would have resulted in a bill of 18,130.40 euros, while with Emaya's hotel tariff the amount paid is 1,944 euros.

According to the former technician, these differences show that the hotel tariff does not work like a progression applied to a single large consumer. His interpretation is that the division into blocks of two places acts as a technique that reduces the capacity of the progressive tariff to penalize higher consumptions.

The underlying issue is whether this methodology maintains the spirit of a progressive tariff, which usually aims for higher consumptions to bear an increasing cost. In the case of Palma's hotel establishments, Emaya approved a specific formula in which the unit of calculation is not the total consumption of the establishment, but the tariff blocks associated with two places.