The city mining agency is planning to raise ground water fees for businesses and industry by an average 600 percent, in a bid to balance prices set by tap water providers.

"In principle, ground water should be more expensive than tap water," agency head Peni Susanti said Thursday at City Hall.

"Tap water providers have increased their water tariff six times, while we haven't done anything."

Consequently, businesses had opted for cheaper ground water in spite of a 1998 ordinance intended to restrict businesses and industries from using ground water when they were located within tap water operators' service areas, she said.

The ordinance also prohibits businesses from consuming more than 100 cubic meters of ground water per well per day.

Since the enactment of the ordinance, Peni said, the agency had found 100 office buildings in the capital were drawing excessive amounts of ground water. In 2002 alone there were more than 400 businesses stealing ground water, she said.

Limited coverage areas of tap water suppliers PT Pam Lyonnaise Jaya (Palyja) and PT Thames PAM Jaya (TPJ) had prompted businesses to unlawfully use ground water, Peni said.

The two operators impose rates of Rp 5,932 (64 U.S. cents) per cubic meter on average -- the highest water rates in Indonesia.

The huge amount of ground water consumption had raised public concerns over a water crisis in the capital and land subsidence, Peni said.

The new rates were important to discourage further use of ground water, she added.

"We'll focus on high-rise buildings through the future ground water tariff policy, as 87 percent of them have affected the land's solidity," she said.

The exploitation of ground water in Jakarta has accelerated land subsidence, particularly in business districts where many high-rise buildings have been built.

The groundwater level in the Mega Kuningan business area in South Jakarta, for example, is dropping by five meters per year.

The agency recorded 80 percent of the city's land subsidence was caused by building construction, 17 percent by ground water exploitation and 3 percent by natural causes.

According to the head of the agency's groundwater management department, Dian Wiwekowati, the agency has finished drafting the future policy that will be issued in a gubernatorial decree after its approval from City Council.

There will be various ground water fares, she said.

"For example, the current price of Rp 3,000 per cubic meter for big industries will increase to Rp 16,000 after the decree," she told The Jakarta Post.

The new fares, expected to come into effect by the end of 2008, would affect some 3,780 businesses and industries holding agency-issued permits, she said.

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