Below we present key information on our decisions for Water NSW’s rural bulk water services for customers in the North Coast valley. This information is not exhaustive and should be viewed in conjunction with our Final Report and Determination. 

Prices for North Coast valley will increase from 1 October 2021 

Under our decisions, Water NSW’s prices will increase as its efficient costs are higher than those used to set prices for the 2017 Determination. The key drivers of these increased costs include that the customer share of: 

  • operating expenditure for North Coast valley has increased by 44.4% (but by 3.4% less than proposed by Water NSW), mainly due to increased expenditure on metering and compliance, asset management planning and long term transformational strategy. 
  • capital expenditure for North Coast valley has increased by inflation (and by 31.2% higher than proposed by Water NSW), mainly due to increased expenditure on internal corporate projects, dam safety compliance and environmental planning & protection. 

Offsetting these factors are a lower cost of capital, which has decreased from 4.7% to 3%.

Decision on customer share of revenue requirement for North Coast valley over 2021 Determination

Note: UOM is the payback of "unders and overs mechanism" balance from the 2014-17 regulatory period.

Data source: IPART analysis.

What drives the change in costs for North Coast valley since the 2017 determination period?

Data source: IPART analysis.

Decision on prices for the North Coast valley

Whilst we aim to set prices that fully recover the customer share of efficient costs, in setting the 2017 Determination it was recognised that Full Cost Recovery (FCR) was likely to be unattainable in the North Coast valley over the 2017 Determination and going forward. 

For the 2021 determination period, we have decided to keep prices constant in real terms for the North Coast valley. This will recover about 8% of the customer share of efficient costs.

The table below sets out our decision on Water NSW’s prices, as well as Water NSW’s proposed prices. 

Decision on bulk water charges – North Coast valley ($/ML, $2021-22)

  2020-21 ($2020-21) FCR proposed IPART decision Change 2020-21 to proposed Change 2020-21 to decision Difference between proposed and decision
High security $12.69 $12.83 $12.82 1.1% 1.0% -0.1%
General security $9.83 $9.94 $9.94 1.1% 1.1% 0.0%
Usage $18.77 $18.98 $18.98 1.1% 1.1% 0.0%

Note: Water NSW’s proposed prices are based on prices that recover Water NSW’s proposed costs over a 4-year period on a full cost recovery basis.

Source: Water NSW proposal and IPART analysis.

Indicative bills under our decisions for the North Coast valley

The table below shows indicative bills under our decisions, as well as indicative bills that would arise from Water NSW’s proposed prices.

Indicative annual bulk water bills for North Coast valley ($2021-22)

  Estimated entitlements (ML) Estimated usage (% of entitlement) 2020-21 ($2020-21) FCR proposed IPART decision Change 2020-21 to proposed Change 2020-21 to decision Difference between proposed and decision
High Security
Small user 5 100% $157 $159 $159 1.1% 1.1% 0.0%
Medium user 10 100% $315 $318 $318 1.1% 1.1% 0.0%
Large user 50 100% $1,573 $1,591 $1,590 1.1% 1.1% 0.0%
General Security
Small user 20 10% $234 $237 $237 1.1% 1.1% 0.0%
Medium user 100 10% $1,171 $1,184 $1,184 1.1% 1.1% 0.0%
Large user 350 10% $4,097 $4,143 $4,143 1.1% 1.1% 0.0%

Source: Water NSW proposal and IPART analysis.

The indicative bills shown below represent indicative bills combining Water NSW’s prices for its bulk water services and the Water Administration Ministerial Corporation’s (WAMC’s) prices for its water management services.

High security bills for North Coast valley (medium user)

Note: We used actual entitlement numbers and allocations data in defining “small", "medium" and "large" users. See our WAMC Final Report (hyperlink) for further information on WAMC bills.

Data source: Water NSW proposal and IPART analysis.

General security bills for North Coast valley (medium user)

Note: We used actual entitlement numbers and allocations data in defining “small", "medium" and "large" users. See our WAMC Final Report (hyperlink) for further information on WAMC bills.

Data source: Water NSW proposal and IPART analysis.

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Water NSW’s proposed costs, prices and indicative bills as presented in our Issues Paper released in September 2020 

Our Draft Report on Water NSW’s rural bulk water prices released in March 2021