Newstalk has learned that Irish Water may be given permission to hike the price of water if demand is lower than expected.

The Commission for Energy Regulation (CER) is considering the move if it was deemed necessary to meet the costs incurred by the company in running the network.

It has also warned that the water charge may rise in times of drought or other shortages.

However in a statement this afternoon, the Department of the Environment says it envisages that water charges will be fixed until the middle of 2016.

The CER says it expects to begin a public consultation on the tariff structures in the 2nd quarter of this year, with a decision in the 3rd quarter.

It says the charge will be based on a number of factors: including the quality of the Irish Water service, its commercial viability as well as how Irish Water measures up with water providers in other countries.

Newstalk's Political Editor Shane Coleman gave more details to Newstalk Lunchtime.

Meanwhile the Fianna Fáil leader has described as 'a scandal' revelations abut the amount of money Irish Water has spent on consultants.

The head of the utility company admitted this morning that of the €100 million spent to establish Irish Water, around €50 million was paid to consultants.

John Tierney has defended it, saying the company had to be established and be up and running in just 12 months.

But Micheál Martin is outraged, and has accused the government of setting up 'one hell of a quango'.