The Government is said to be considering linking payment of Irish Water bills to the conservation grant.
It has emerged this evening that the measure is being considered following Eurostat's finding against Ireland on the controversial state utility.
It has been reported that the cabinet is also considering keeping the capped water charges in place for at least a decade.
Political Correspondent with the Irish Times, Fiach Kelly believes that the mooted move is designed to increase compliance.
"The Government is considering a number of moves, including making sure that people who claim their €100 water conservation grant from the Department of Social Protection have actually paid their bills," said Mr Kelly.
"Up to now you merely had to register with Irish Water, you didn't actually have to pay your bill to get the €100, but the moves the Government are considering would mean that only people who have paid their bills will get the money," he said.
"In effect, it's an effort to drive up compliance to make sure that more people pay their water charges."
The Water Conservation Grant of €100 is designed to help fund any repairs or improvements to a person's home that will increase water conservation, such as changing dripping taps or fixing leaking cisterns, or to help fund water butts or to install dual flush toilets.
Irish Water will have a “first fix free” scheme to fix customer leaks, but some leakage may be internal to the house, and the Water Conservation Grant has been devised to help fund such repairs.