NSW utilities welcome reduced water prices and increased infrastructure investment

Residents in New South Wales (NSW) are set to benefit from a reduction in water prices and an increase in infrastructure investment over the next four years, following the release of the Independent Pricing and Regulatory Tribunal’s (IPART) 2020-2024 price review.

Average household bills for Sydney Water customers will fall by about $80 per year, or 7% during usual weather conditions. Hunter Water’s customer bills are also set to fall by about $48 per year, or 3.6%.

Sydney Water Managing Director Roch Cheroux said the utility welcomed the determination, and looked forward to delivering cost-savings to households doing it tough. 

“Sydney Water bills were already some of the lowest in the country and this proposal will provide further relief to households when they really need it,” he said. 

“It has been a challenging time for communities living through drought and the coronavirus, so it is pleasing water and wastewater bills have been kept low and Sydney Water can continue its role in building resilience into our water network, which will also provide a significant boost to jobs and the economy.”

Sydney Water will dedicate further investment in new and improved infrastructure as a result of the determination, which is planned to support population increase in the growing capital. 

“Sydney Water presented a very strong case for investment, which IPART recognised, and that means we can invest in the new and existing infrastructure required to support a fast-growing global city,” Cheroux said. 

“Over the next four years, we will be building and upgrading water and wastewater treatment plants, increasing the use of digital technologies, including network monitoring systems and research innovations that will drive greater efficiencies across Sydney Water and improve services to customers.”

Hunter Water Managing Director Darren Cleary said IPART’s determination means the utility’s customers will have more control over their bills, with an increased portion of their bill coming from usage charges, rather than fixed charges.

“This provides an additional incentive for our customers to love water, with the majority of the typical household’s water bill to come from their water usage charge of $2.46 per thousand litres,” Cleary said. 

“Fixed charges will fall by 76% to $24 per year, or just over $8 per bill.”

IPART’s determination also gave Hunter Water the green light to move ahead with its $653 million program for capital infrastructure works, an increase in investment of 31% compared to the past four years.

“This is welcome news and means that we can get to work on delivering important projects to ensure we continue to provide great services for our customers and community,” Cleary said.

“This will include major water and wastewater network upgrades, a continued focus on water conservation and leakage reduction initiatives, and additional funding for water recycling infrastructure and stormwater naturalisation works.

“As a major service provider in our region, the impact of these works will extend beyond Hunter Water, helping to sustain local jobs.”

New price on drought

While the pricing determination is good news for consumers, it is dependent on rainfall, with  IPART approving the introduction of a drought price for the first time.

During drought, NSW consumers can expect to see an increase in bills if water storage drops below 60%.

“While there’s a low chance of this price being applied, it would provide a strong additional incentive for Lower Hunter residents to save water during periods of severe drought,” Cleary said.

“A 15% reduction in water use would fully offset the costs of this drought price.

“It also reflects extra costs associated with delivering water during these periods, such as higher treatment costs associated with the operation of the Tomago Sandbeds and increased water conservation initiatives.”