Water rates are the charges customers pay for drinking water service, typically based on metered consumption. Rate structures may include base charges (fixed amounts covering service availability), volumetric charges (per-cubic-metre rates for consumption), and sometimes tiered rates (higher per-unit charges for higher consumption to encourage conservation). Water rates must generate sufficient revenue to cover treatment, distribution, and system maintenance costs while funding capital reserves for infrastructure replacement. Rate-setting involves balancing cost recovery, affordability, conservation incentives, and rate stability. Provincial regulations may govern rate-setting processes. Water rate increases often attract public attention and concern, though Canadian water rates remain relatively low by international standards. Full-cost pricing—setting rates to cover all current and future system costs—is increasingly advocated but not universally implemented.