Residents of Mexico City have run up unpaid water bills totaling almost 1bn pesos (US$83.2mn), according to Ramon Aguirre, head of city water utility SACM.
Around 200,000 residents and companies currently have debts running from four to 10 months, with 12-15% of the city failing to pay water bills, Aguirre was reported as saying by local paper El Universal.
The total debt represents 20% of the city's billed water volume, according to the report.
SACM plans to send letters to non-paying users during 2011, and will cut off the water supply for repeat offenders.
Unpaid bills are not the only problem affecting the city water utility, as physical losses and illegal connections are also a serious headache.
Illegal users consume around 10% of the water each year, while damaged distribution pipelines mean another 40% of the 1.09Bl of potable water produced each year is lost due to leaks.