SOUTH East Queensland water prices look set to rise, with water used by average Logan household up by $16 to $34 in the 2018-19 financial year.
The Queensland Competition Authority has today released its final report recommending bulk water prices for 2018-21 for SEQ after considering submissions received through a review.
The State Government determines bulk water prices across 11 SEQ council areas and has directed the QCA to review the costs of the sole supplier, Seqwater, and recommend pricing options.
QCA chairman Professor Roy Green said bulk water charges accounted for about 30 per cent of an average household water and sewerage bill.
For historical reasons, bulk water prices varied from council to council but a single common price for a kilolitre – 1,000 litres – was expected to apply across SEQ by the end of the decade.
Eight – Logan, Scenic Rim, Morteon Bay, Brisbane, Gold Coast, Ipswich, Lockyer Valley and Somerset – had reached a common price. Redland City, the Sunshine Coast and Noosa need to make up ground.
The State Government asked the ACA to present two pricing options – one that would see the common price reached by all councils in 2019-20 and the second, with the common price reached by 2020-21.
Professor Green said under the first option, those paying the common price of $2.82 per kilolitre would face a rise by 5.2 per cent in 2018-19 and 2.5 per cent in each of the next two years.
“This would mean the bulk water component of the bill of an average household – using 160 kilolitres per year – in these council areas would rise by $23.20 in 2018-19 and $12 in each of the next two years,” he said.
The price for Sunshine Coast and Noosa would increase by 8 per cent in 2018-19, 7.4 per cent in 2019-20 and 2.5 per cent in 2020-21, while the price for Redland City would rise by 9.3 per cent, 8.5 per cent and 2.5 per cent.
“The bulk water component of an average household’s bill in Sunshine Coast and Noosa would increase by $33.60 in 2018-19, $33.76 the following year and $12 in 2020-21. In Redland City, the increases would be $38.08 for each of the first two years and $12 in 2020-21,” he said.
Professor Green said under the second option, the common price would rise by 3.5 per cent in each of the three years, resulting in increases for the average household of $16 to $17 each year.
“The second option would provide more gradual increases for the other three council areas – over a three-year span instead of two – with Sunshine Coast and Noosa seeing price increases of 6.5 per cent, 6.1 per cent and 5.7 per cent, while Redland City consumers would see rises of 7.3 per cent, 6.8 per cent and 6.4 per cent.
“This would see average households facing increases of about $27 each year for Sunshine Coast and Noosa and $30 each year for Redland City.
“Under this second option, a common price of $3.12 per kilolitre would apply to all 11 councils in 2020-21.”
The State Government took over control of bulk water supply from the region’s councils in 2008 in response to a severe drought.
To reduce the price impact of significant investments made in water infrastructure in response to low-water availability, the State Government decided that bulk water price increases for the region should be phased-in over time through a bulk water price path.
“Prices were initially set to recover less than the cost of supplying bulk water, with the accumulated under-recovery – or ‘price path debt’ – to be gradually repaid in full by 2028,” said Professor Green.
Public involvement was an integral part of the QCA review process and 11 stakeholder submissions had been considered by the QCA in making its recommendations, he siad.
The State Government will decide whether to accept the QCA final pricing recommendations.
