Lake Awoonga from the air.
Lake Awoonga from the air.

Five-year plan for water pricing lodged for review

A FIVE-YEAR plan for water pricing and capital works has been outlined by Gladstone Area Water Board in what has been described as a "key milestone" in a pricing review.

GAWB has lodged its submission with the Queensland Competition Authority as part of its 2021-25 price monitoring investigation.

As part of a five-yearly review, QCA's investigation will cover prospective water prices between July 1 next year and June 30, 2025.

GAWB chief executive officer Darren Barlow said the review would provide an independent assessment of its capital and operating expenditure, and the rationale behind its water demand forecasts.

Mr Barlow said the purpose of the external review was to ensure GAWB charged prices for water that were reasonable, given the costs it incurred.

In its submission, GAWB said its material costs between 2020-25 were expected to be "materially higher".

It estimated capital expenditure would increase to $179 million during the period, with works scheduled to replace ageing assets and address regulatory or compliance obligations.

Of that, about $60.7 million would be spent on dam safety upgrades, it said.

The submission said prospective prices for 2021-25 were calculated based on a five-year planning and price smoothing period, resulting in an average nine per cent increase in prices network-wide.

Price changes would vary between customers, it said.

"The cost of water varies … and our proposed pricing model reflects that," Mr Barlow said. "It's not a one size fits all approach."

It said GAWB had a "unique" customer base, with 80 per cent of its water supplied to heavy industry customers, and 20 per cent supplied to Gladstone Regional Council. It said while water was not a major cost for most industrial customers, it was essential for production.

"Security of supply is a priority for customers, and they are supportive of GAWB taking actions to prevent or mitigate potential adverse impacts on their operations or investments that would result from interruptions of supply."

It said the prices should provide enough revenue to recover the costs of catchment management and recreation facilities. Businesses and the public can also make submissions into the review before October 28. The QCA will release a draft report of its investigation by February 28 next year and a final report by May 29 next year.

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