When will politicians learn the political price of complexity?
Look at Irish Water.
First things first. Establishing a national utility out of a local authority patchwork of pipes and personnel is complicated to begin with. There are a lot of people to satisfy, a lot of metaphorical buried bodies, and a whole load of politics.
But layering on even more components makes the project even more complex. Look at how Irish Water has made a complicated assignment into a labyrinthine project.
Firstly, there’s the accelerated meter installation program. The plan was to have a large proportion of the two million remotely readable domestic meters installed by the beginning of this month. That didn’t happen. Installing and commissioning one of these meters requires many steps and a lot of things can and do go wrong. Dodgy pipes, bad workmanship and shared water supplies are just some of the obstacles. At the wider system level, these remotely readable meters are a new technology in Ireland and there is relatively little expertise in making them work. There are no statistics that I know of on how far Irish Water has gotten with its meter project, but it looks like they are less than half-way there.
There was really no need to install such complex meters on the first go out. A simpler in-home non-digital meter which water users could opt into having installed would have been cheaper and faster. The fancy meters could have been rolled out over a number of years, as the mains got upgraded.
Secondly, there is an ultra-complex system of charging, based on a structure of allowances and estimated assessments of water use (these assessments are critical because the meter program is so far behind schedule). The official description of the charging structure is some 31 pages long.
The simple alternative to this charging system and was described by Richard Tol in 2011. With this system, meters would be opt-in. The same allowances for children and usage could have been provided through increases in social welfare and through adjusting tax credits to put more money in people’s pockets to pay the charge.
Finally, the two factors above have converged to create a requirement for an extremely complex IT system. The requirement to collect personal information to assign allowances to individuals means that there are extremely complex issues around privacy, which Irish Water does not seem to have fully grasped.
This complexity has also resulted in a pretty odd website, a disastrous PR campaign based on some pretty dodgy conceptual work described in this fascinating PowerPoint presentation. There are ‘tribute’ sites inspired by and devoted to the topic of Irish Water and which give (un-useful) tips on what to do if Irish Water should happen to try to install one of their new fangled gadgets outside your house. The long term comedic value of the Irish Water ‘ecosystem’ should not be underestimated.
The end result of this is that Irish Water is wasting a lot of money on effort on a metering system that doesn’t really do anything to help it achieve its goal. Instead of focusing on driving down the cost of water, encouraging water saving and fixing the leaks in our rather dodgy national water network, Irish Water has gotten itself bogged down in an expensive, unpopular and ultimately unnecessary project which is going to deliver a lot of problems and very few benefits. But it isn’t Irish Water who will have to bear the cost. It will be citizens, and their elected politicians, who will pay the price.
The strangest twist in the saga was that Irish Water was given to Bord Gais so that expertise in utility retail could be shared. And then the retail arm of Bord Gais was sold.
That was probably a very good thing. The retail arm (BGE) turned out to be a business that was literally worthless. http://www.irishtimes.com/business/sectors/energy-and-resources/sale-of-bord-gáis-energy-not-the-bounty-that-has-been-portrayed-1.1868693