THE next big drain on household budgets will be water, a report released today warns.
Water and sewerage expenses could double by 2040 - to around $2500 a year - according to findings by Infrastructure Australia.
And the shock to households could pressure governments to sell off water supply businesses - one of the few public utilities not to be privatised.
Ageing infrastructure is costing more to maintain with the extra expense being passed on, while climate change and growing populations will further strain supplies of clean water.
"If Australians want continued access to safe, reliable and affordable water in the future, we need to begin a staged approach to reforming the sector now - starting with a new national urban water reform plan," Infrastructure Australia CEO, Philip Davies, said.
"Across Australia many of our dams are relatively full, which gives us a rare window of opportunity for clear thinking and long-term planning to meet our future needs."
Infrastructure Australia recommends:
• The creation of a national reform pathway by the end of 2018, implemented by an independent national reform body and using incentive payments to drive reforms;
• A national rollout of reforms over five years targeting regulations and governance within state governments;
• Major changes such as creation of a national regulator and the privatisation of urban water waste.
The report warned the national population will grow to 30 million by 2030 with most people living in Sydney, Melbourne, Brisbane and Perth.
"These cities alone are expected to house an additional 5.9 million people over the 20 years to
2031," says the report.
"Sydney and Melbourne's populations will each swell to around six million, while Brisbane and Perth will both exceed three million."
Infrastructure Australia calculated the total number of properties supplied with water and sewerage would increase by around three million over the 20 years to 2031.
And total water supply is projected to double over this period, to over 15,000 gigalitres (GL).
"Our fast-growing cities will require an increasing supply of potable water to meet growing demand," said the report.
It said water utilities were already struggling to manage the effects of climate change.
"For instance, the repeated floods and cyclones across Queensland over the past 10 years suggest that these weather patterns are the new norm, rather than an anomaly," the report said.
"In regional towns, the risks of climate change may be even more pressing than in metropolitan areas.
Aside from the greater chance of exposure to extreme temperatures or weather events, regional water utilities do not have the same level of resources as their metropolitan counterparts.
"In cases of system failure in some regional towns, it may take days or weeks to restore services, which could have serious implications for local households and businesses."
And the threat of major national drought underlined the need to boost water storage.
The report also pointed to the strain on pipes and drains from high-density city accommodation.
"The growing proportion of multi-unit dwellings in many cities brings efficiencies for water supply, sewerage and other services," it said.
"The benefits of increased densification could be substantial, with Sydney Water estimating that the cost of servicing greenfield lots is on average five to six times higher than for infill properties.
"Growth in infill development is not without its challenges, however.
"While those in apartments may use less water for their gardens and cars, the increasing density of developments in many urban areas is placing legacy infrastructure under increasing pressure and heightening flooding and fire risks by concentrating patterns of demand within smaller geographic areas, and during peak periods in the morning and evening.
"Similarly, legacy stormwater systems may struggle with increasing volumes of run-off from dense urban environments."