Melbourne Water's Prices for 2008 - 2009
- Water
- Sewerage
- Waterways and Drainage
- Diversion charges
- Developer charges - development service schemes
- Stormwater Quality Offsets Strategy
- Recycled water
- Miscellaneous charges
Melbourne Water's 2008/09 prices for bulk water and sewerage services, and pricing principles for recycled water, are as allowed by the Essential Services Commission. These prices and pricing principles were developed in accordance with requirements in Melbourne Water's Statement of Obligations. It is likely that future prices will be determined by the Essential Services Commission for the 4 year regulatory period commencing 1 July 2009. This will follow a public process requiring Melbourne Water to submit a Water Plan.
Melbourne Water's prices for waterways and drainage were set by the Essential Services Commission through a public process, and reflect the Essential Services Commission's assessment of the efficient cost of meeting customer, regulatory and government requirements. As part of this determination the Essential Services Commission set maximum prices for five years commencing 1 July 2008 for waterways and drainage charges, miscellaneous charges (related to waterways and drainage) and diversion charges. The Essential Services Commission made its decision taking into account:
- Proposals put forward by Melbourne Water in our 2008 Waterways Water Plan
- Technical reviews commissioned by the Essential Services Commission
- Submissions by interested parties.
Water
Melbourne Water manages Melbourne's water supply catchments and transfers water to the three metropolitan retail water businesses and two non-metropolitan water authorities.
Melbourne Water's prices comprise of fixed monthly availability prices and variable prices based on the total volume of water used by each retail water business. From 1 July 2006, fixed and variable prices were split into components for headworks and transfer to increase transparency and support the potential trading of bulk water entitlements. The following prices apply from 1 July 2008 to 30 June 2009:
| Retailer | Fixed Price ($/Month) | Usage Price ($/million litres) | ||
|---|---|---|---|---|
| Headworks | Transfer | Headworks | Transfer | |
| City West Water | 42,098.13 | 23,847.23 | 181.37 | 469.03 |
| South East Water | 1,766,414.28 | 1,000,617.37 | 181.37 | 146.14 |
| Yarra Valley Water | 2,170,051.29 | 1,229,264.86 | 181.37 | 111.77 |
| Western Water: | 42,106.29 | 23,851.85 | ||
| ≤ 5,000 million litres per annum | 123.06 | 352.18 | ||
| > 5,000 million litres per annum | 123.06 | 510.10 | ||
| Gippsland Water | 1,198.77 | 359.628 | 43.82 | 0 |
Sewerage
Melbourne Water removes, treats and disposes of sewage and trade waste collected from the metropolitan retail water businesses.
Melbourne Water's prices comprise three components - a fixed monthly availability price, a weekly price based on the total volume of sewage received from each retail water business (including non major trade waste) and a monthly price based on load from major trade waste customers collected by each retail water business. The following prices apply from 1 July 2008 to 30 June 2009:
| Western System | Eastern System | |
|---|---|---|
| Volume ($/million litres) | 76.92 | 142.24 |
| Non major trade waste load ($/million litres) | 60.81 | 210.79 |
| Major trade waste load | ||
| BOD ($/tonne) | 38.57 | 295.11 |
| SS ($/tonne) | 6.84 | 259.17 |
| TN ($/tonne) | 782.69 | 575.43 |
| TDS ($/tonne) | 12.02 | 12.02 |
| City West | South East | Yarra Valley | |
|---|---|---|---|
| Availability charge ($/month) | 3,604,739.11 | 4,530,943.09 | 6,330,217.94 |
Waterways and Drainage
Melbourne Water manages rivers, creeks and major drainage systems as the regional drainage, waterway and floodplain manager for the Port Phillip and Westernport region. We work closely with local councils, which have responsibility for local drains, road networks, street and property drainage, which feed into the regional drains and rivers and creeks.
Waterways and drainage charges are applied to all rateable properties (as defined in the Local Government Act (1989)) located within Melbourne Water's waterway management district (i.e. existing and extended service areas).
Charges in the existing service areas are based on 1990 property values and are subject to a minimum fee. The relevant property value is Net Annual Value (NAV), as determined for the purposes of the Local Government Act (1989), multiplied by the valuation equalisation factor applying to the area in which the property is located. The valuation equalisation factor is determined by the Valuer General and represents the level of value prevailing in property areas as at 30 June 1990. In Patterson Lakes, the relevant property value for the extra fees paid by customers is Site Value (SV), as determined for the purposes of the Local Government Act (1989).
The minimum fee will be applied to all new residential properties that come into existence in the existing service areas from 1 July 2008, included under section 1.1 in the table below.
In the extended areas, the minimum fee will be applied to all residential and non-residential properties in respect of each separate occupancy, as defined in the Local Government Act (1989), included under section 1.2 in the table below.
A minimum fee reflecting only waterway management costs will be applied to properties located outside the Urban Growth Boundary (in both the existing and extended service areas), included under section 1.3 in the table below.
Charges for properties within the special drainage areas are set taking account of consultation with customer committees and reflect the relative level of service received. These are included in section 1.4 in the table below.
The following waterways and drainage charges apply from 1 July 2008 to 30 June 2009:
| Waterways and Drainage Charge | Minimum Fee/Rate in $ |
|---|---|
| 1.1 Waterways and drainage charge - all properties located within the area designated as the Urban Growth Boundary, except those indicated in 1.2: | |
| Residential | |
| Minimum fee (cents per annum) | 62.08 |
| Rate in $ NAV ($ per annum) | 0.8252 |
| Non residential | |
| Minimum fee ($ per annum) | 81.36 |
| Rate in $ NAV (cents per annum) | 0.8664 |
| 1.2 Waterways and drainage charge - all properties included in the waterway management district as a result of extending Melbourne Water's operating area in November 2005 (including all properties within the Shire of Mornington Peninsula), except those indicated in 1.3: | |
| Residential | |
| Minimum fee (cents per annum) | 62.08 |
| Non residential | |
| Minimum fee ($ per annum) | 81.36 |
| 1.3 Waterways charge - all properties located outside the area designated as the Urban Growth Boundary ($ per annum), except those indicated in 1.4: | 38.88 |
| 1.4 Special drainage area charge - all properties in the following parts of the area of the former Dandenong Valley and Western Port Authority as at 5 November 1991, which up to 1997, were subject to a special drainage and river improvement rate | |
| Koo Wee Rup - Longwarry Flood Protection District | |
| Division A | |
| Minimum fee ($ per annum) | 56.40 |
| Rate in $ NAV (cents per annum) | 3.6000 |
| Division B | |
| Minimum fee ($ per annum) | 56.40 |
| Rate in $ NAV (cents per annum) | 2.0000 |
| Extra Fees at Patterson Lakes | |
| Tidal Waterways properties | |
| Minimum fee ($ per annum) | 0.00 |
| Rate in $ SV (cents per annum) | 0.4269 |
| Quiet Lakes properties | |
| Minimum fee ($ per annum) | 0.00 |
| Rate in $ SV (cents per annum) | 0.3513 |
Diversion charges
Melbourne Water administers active licences for diversion of some 45,000 megalitres of water from waterways and licensed dams in accordance with powers delegated by the Minister under the Water Act 1989. Diversion licences in the Yarra catchment, Stony Creek, Kororoit Creek, Laverton Creek and Skeleton Creek are for supply of water from unregulated streams. Diversion licences from the Maribyrnong River are supplied from a regulated river system via releases made to the river from Rosslynne Reservoir at Gisborne.
The following charges apply from 1 July 2008 to 30 June 2009:
| Diversion charges unregulated waterways | $ |
|---|---|
| Licence service fee - All months (per annum) | 192.00 |
| Licence service fee - On-stream winter-fill (per annum) | 192.00 |
| Licence service fee - Off-stream winter-fill (per annum) | 192.00 |
| Licence service fee - Licensed farm dam (per annum) | 192.00 |
| Licence service fee - Non-consumptive (per annum) | 192.00 |
| Licence service fee - Power generation (per annum) | 192.00 |
| Licence service fee - Stormwater (per annum) | 192.00 |
| Plus fee per kilowatt | 17.60 |
| Charge per million litres - All months | 14.34 |
| Charge per million litres - On-stream winter-fill | 7.23 |
| Charge per million litres - Off-stream winter-fill | 7.23 |
| Charge per million litres - Licensed farm dam | 7.23 |
| Charge per million litres - Non-consumptive | 1.31 |
| Charge per million litres - Stormwater | 14.34 |
| Diversion/stormwater licence application fee | 336.60 |
| Works/construction licence application fee | 565.00 |
| Dams operating licence | 65.60 |
| Transfer of ownership (including temporary) | 97.00 |
| Transfer of ownership with dam sharing agreement | 195.00 |
| Resource assessment fee for downstream trade/transfer | 336.60 |
| Resource assessment fee for upstream or cross catchment trade/transfer | 619.20 |
| Licence renewal fee following failure to renew (Domestic and stock) | 91.20 |
| Licence renewal fee following failure to renew (all other licences) | 182.40 |
| Reissue after Melbourne Water cancellation or breach of conditions | 614.40 |
| Diversion charges regulated waterways | $ |
| Licence service fee - All months (per annum) | 192.00 |
| Licence service fee - Off-stream winter-fill (per annum) | 192.00 |
| Charge per million litres - All months | 43.25 |
| Charge per million litres - Off-stream winter-fill | 7.23 |
| Diversion licence application fee | 336.60 |
| Works/construction licence application fee | 565.00 |
| Transfer of ownership along Maribyrnong River (includes temporary) | 97.00 |
| Licence renewal fee following failure to renew (Domestic and stock) | 91.20 |
| Licence renewal fee following failure to renew (all other licences) | 182.40 |
| Reissue after Melbourne Water cancellation or breach of conditions | 614.40 |
| Diversion licences - meter | Cost of meter |
Conditions associated with dam operating licence charges
The service charge will apply only to the owners of dams that meet the following criteria:
- The dam is off a waterway and has a wall height of 5 m or greater and a capacity of 50 million litres or more, or
- The dam is off a waterway and has a wall height of 10 m or greater and a capacity of 20 million litres or more, or
- The dam is off a waterway and has a wall height of 15 m or greater regardless of capacity, or
- The dam is on a waterway and has a wall height of 3 m or greater and a capacity of 10 million litres or more.
The owner of the dam must meet the criteria outlined in the associated operating licence. Conditions are outlined in the associated operating licence schedules.
Developer charges - drainage schemes
Melbourne Water administers policies and requirements for urban development in its role as a major waterway and drainage system manager. Melbourne Water uses its powers as a statutory referral authority to require developers to enter into agreements under 269A of the Melbourne and Metropolitan Board of Works Act (1958) to meet the cost of new regional drainage infrastructure through payment of developer charges.
Using principles for defining drainage schemes agreed between Melbourne Water and the development industry, developer charges will be calculated by:
- Identifying future capital expenditure for each year of the expected life of the scheme
- Identifying forecast developable hectares for each year using an estimate of development density
- Applying a pre-tax real discount rate to convert future cash flows into present value terms
- Setting the developer charge such that the present value of future income equals the present value of future costs. Future income is equal to the developable hectares in each year multiplied by the developer charge
- Reviewing the financial assumptions relating to each scheme on an annual basis and reviewing engineering specifications every five years
Consistent with standard practice, 2 months notice will apply for rate increases; rate decreases will be effective immediately.
A list of current scheme charges is provided on the Melbourne Water Land Development Manual (LDM) website.
Stormwater Quality Offsets Strategy
Stormwater offsets are a financial contribution to Melbourne Water for regional water quality works, undertaken elsewhere within the catchment to offset pollution loads not treated within the development. The offset rate is based on the average cost to construct regional water quality treatment. Offsets provide flexibility for developers where best practice performance objectives are not currently mandated (i.e. non residential developments). The program operates in the Port Phillip and Western Port catchments.
The Government's Melbourne 2030 strategy includes an objective to reduce the negative impact of stormwater on waterways and bays. Growth is expected to generate up to 200 tonnes of increased nitrogen loads by 2030.
The current best practice standards for urban development are to retain 80% of the suspended solid annual load, 45% of total phosphorus and 45% of total nitrogen annual loads for all new development.
The Stormwater Offsets Program was introduced in September 2005.
From October 2006 , as part of the Victorian Government's Sustainable Neighbourhoods package (Clause 56 of the VPPS) to create more sustainable and liveable communities, local governments are now required to set water sensitive urban design requirements for residential subdivisions (ie meet the best practice stormwater objectives) with the costs to be met by developers.
With the new provisions, water quality treatment will need to be implemented at a local scale protecting greater lengths of waterway and reducing the need for large regional treatments - traditionally designed into Melbourne Water's Developer Services Schemes. However where existing schemes contain regional water quality treatment developers will still have the option of contributing to these works as a way of meeting the Clause 56 requirement. New Greenfield drainage schemes will continue to provide flood protections for all developments but will not provide regional water quality treatment for residential developments.
For industrial and commercial development where there are no current planning controls Melbourne Water schemes will continue to provide regional water quality treatments such as wetlands. Non residential developments outside schemes that are less than 5ha will have the option of undertaking works on-site or contributing to the general offset rate. Developments greater than 5ha in size will be required to meet the best practice standards within the development site.
Where regional water quality works exist within developer services schemes developers have the option receiving a reduction in their water quality contribution based on the percent to which best practice objectives have been met on-site.
Stormwater Quality Offset Principles
- All urban developments shall achieve best practice water quality objectives.
- Objectives can be achieved through on-site works, a contribution to off-site works or a combination.
- Nitrogen will be used as the common unit of measure for achievement of stormwater quality objectives.
- Outside development service schemes offsets will be based on the cost of regional water quality works designed to achieve equivalent stormwater pollutant load reductions.
- Outside of development services schemes offset will vary according to land use and climatic conditions across the catchment.
- The water quality contribution in development service schemes will be based on scheme specific costs to achieve water quality objectives.
Recycled water
Melbourne Water provides recycled water for our retail partners, which supply recycled water and customer service directly to users. Our retail partners include Southern Rural Water, TopAq and the metropolitan retail water businesses.
Recycled water prices are set by pricing principles, which are detailed below.
Recycled water prices should be set so as to:
- Have regard to the price of any substitutes and customers' willingness to pay
- Cover the full cost of providing the service (with the exception of services related to specified obligations or maintaining balance of supply and demand)
- Include a variable component
Where Melbourne Water does not propose to fully recover the costs associated with recycled water, it must demonstrate to the Essential Services Commission that:
- It has assessed the costs and benefits of pursuing the recycled water project
- It has clearly identified the basis on which any revenue shortfall is to be recovered
- If the revenue shortfall is to be recovered from non-recycled water customers, either the project is required under the Statement of Obligation which applies to Melbourne Water or pursuant to other Government policies that apply to Melbourne Water or there has been consultation with the affected customers about their willingness to pay for the benefits of increased recycling.
Miscellaneous charges
Melbourne Water currently charges for a range of miscellaneous services provided to the retail water businesses, developers and the general public. The miscellaneous charges for regulated services applying from 1 July 2008 to 30 June 2009 are detailed below:
| Service | Charge ($) |
|---|---|
| Property information statements (encumbrances - per statement): | |
| City West Water | 4.60 |
| South East Water | 4.60 |
| Yarra Valley Water | 4.60 |
| Provision of flood level information Provision of a flood level certificate in PDF format within 10 days of receiving a request |
38.00 |
| Provision of hydrologic data: | |
| Storm frequency analysis for selected storm events | 127.00 |
| Standard fee: One type of daily data from maximum of two stations | 79.00 |
| Standard fee: One type of hourly data from a single station | 79.00 |
| Provision of one type of 6 minute data from a single station for a period of up to 5 years | 79.00 |
| Other requests (per hour) | 127.00 |
| Application fee for construction over Melbourne Water easements or underground pipe | 165.00 |
| Storm water connections/other authorities works (per connection): | |
| Application fee | 122.00 |
| Inspection fee | 336.00 |
| Melbourne Water requires all new stormwater connections to be made to the local council system. Where this is not possible a stormwater connection application must be made to Melbourne Water under S.145 of the Water Act 1989. | |
| Flood feasibility study (per half day) Melbourne Water's assistance in determining the most appropriate drainage works that would be required to service a development. |
650.00 |
| Non-core miscellaneous services | Actual cost |