News

Price increase follows review

By Southern Riverina News

Charges for rural bulk water services in NSW will increase by 1.3 per cent from July 1.

The increases have been announced by the Independent Pricing and Regulatory Tribunal (IPART) following its annual review.

They apply to regulated charges for bulk water services in NSW’s Murray Darling Basin valleys.

IPART says that under the Water Charge (Infrastructure) Rules 2010, it is required to annually consider whether to vary WaterNSW’s charges to account for changes in demand and consumption while balancing the objective of price stability.

This is in addition to a comprehensive review and determination of WaterNSW’s charges every four years. The next comprehensive review is due in 2020-21.

IPART chair Dr Paul Paterson said that although there had been some recent changes in consumption levels, the information available at this time is inconclusive with regard to whether or not there has been a sustained or permanent shift in demand.

‘‘The data provided by WaterNSW shows a 3.73 per cent decline in annual usage volumes across relevant valleys due to lower rainfall or drought,’’ Dr Paterson said.

‘‘But as this is in line with the year-to-year volatility we have observed in WaterNSW’s sales volumes, we are cautious to change prices in the short-term given the unpredictable nature of rainfall.

‘‘Unless there is strong evidence to support a sustained or permanent shift in water consumption, we are inclined to maintain current prices for the next year to avoid price volatility and bill pressure during the drought.

‘‘As part of our next comprehensive review we will consider how we forecast WaterNSW’s sales volumes, drawing on the latest and best available information on factors affecting water consumption in rural NSW.’’

In addition, IPART had agreed to a request from the NSW Department of Industry to defer the next review of the Water Administration Ministerial Corporation’s water management charges by 12 months.

It means the next review, which was due to start in July 2019 for the new determination to apply from July 1, 2020, will now start in July 2020 for 2021.

This means that WAMC’s 2019-20 prices under the current determination will remain constant in nominal terms (with no adjustment for inflation) beyond 2019-20, until IPART makes a new price determination.