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

Draft decision on costs for the Namoi valley

Under our draft decisions, Water NSW’s costs are higher than those used to set prices for the 2017 Determination. The customer share of:

  • operating expenditure for Namoi valley has increased by 20.6% but is 16.7% lower than proposed by Water NSW
  • capital expenditure for Namoi valley has increased by 49.4% but is 22.9% lower than proposed by Water NSW.

Offsetting these increases, the cost of capital has decreased from 3.1% to 1.3%.

Draft decision on customer share of revenue requirement for Namoi valley over 2021 Determination

Notes: Data has been rounded to the nearest percentage - total may not sum to 100% due to rounding. UOM is the pay-back of "unders and overs mechanism" balance from the 2014-17 regulatory period.
Data source: IPART analysis.

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

Data source: IPART analysis.

Draft decision on prices for the Namoi valley

Under the ACCC rules, we are required to set prices for Water NSW that recover its full efficient costs of providing its bulk water services (net of any Government contributions). The table below sets out our draft decision on Water NSW’s prices, as well as prices that would recover Water NSW’s proposed costs on a 4 year full cost recovery (FCR) basis.

Draft decision on bulk water charges – Namoi valley ($/ML, $2021-22)

Current 2020-21 ($2020-21) 4 year FCR Proposed Draft Report Change current to proposed Change current to Draft Report Draft Report to proposed
High security $18.40 $30.18 $26.58 64.0% 44.5% -11.9%
General security $8.58 $10.53 $9.28 22.7% 8.2% -11.9%
Usage $21.52 $29.63 $26.17 37.7% 21.6% -11.7%

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 draft decisions for the Namoi valley

The table below shows indicative bills for 2021-22 under our draft decisions, as well as indicative bills that would arise from Water NSW’s proposed prices (based on full cost recovery over 4 years).

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

Estimated entitlements (ML) Estimated usage (% of entitlement) Current 2020-21 ($2020-21) 4 year FCR Proposed Draft Report Change current to proposed Change current to Draft Report Draft Report to proposed
High Security
Small user 15 60% $470 $719 $634 53.2% 35.0% -11.8%
Medium user 30 60% $939 $1,439 $1,268 53.2% 35.0% -11.8%
Large user 100 60% $3,131 $4,796 $4,228 53.2% 35.0% -11.8%
General Security
Small user 20 50% $387 $507 $447 31.0% 15.6% -11.8%
Medium user 500 50% $9,670 $12,673 $11,183 31.0% 15.6% -11.8%
Large user 2,000 50% $38,680 $50,690 $44,730 31.0% 15.6% -11.8%

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 Namoi valley (medium user)

Note: We used actual entitlement numbers and allocations data in defining “small", "medium" and "large" users. We note this differs to the approach we used for our Issues Paper valley-specific information. See our WAMC Draft Report for further information on WAMC bills.
Data source: Water NSW proposal and IPART analysis.

General security bills for Namoi valley (medium user)

Note: We used actual entitlement numbers and allocations data in defining “small", "medium" and "large" users. We note this differs to the approach we used for our Issues Paper valley-specific information. See our WAMC Draft Report 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