Sydney residents may have to start shelling out an extra 50 per cent on their water bills over the next five years as the city’s population continues to rise.
Sydney Water has proposed an 18 per cent increase in water bills over the next financial year and a further 6.8 per cent increase each year thereafter.
The proposed change amounts to an increase of $4.70 each week for the average water user, totaling more than $250 over the span of a year. Each year after that, water bills will increase by $115.
According to The Daily Telegraph, Sydney Water plans to increase water prices to support its network upgrade, which is expected to cost more than $26 billion over the next five years.
Almost $10 billion will be channeled into operating costs and $16.6 billion will be spent on infrastructure, focusing on western Sydney.
Sydney Water CEO Roch Cheroux said the utility’s “aging assets, population growth and climate change resulting in more unpredictable and extreme weather events” were some of the key reasons for the improvement.
The New South Wales government’s housing plan plans to build almost 400,000 new homes across the state by 2029.
Sydneysiders will pay more for water each year if the proposed changes are approved.
Sydney residents could see a dramatic increase in water bills.
As the city expands, many of the newer suburbs rely on old and outdated infrastructure for water supply, which is now reaching its limits.
The housing target can only be delivered if 50,000 kilometers of new pipes are installed.
Most of the $26 billion budget will be spent on wastewater, with operating costs primarily going toward drinking water.
“The urgent need to support a rapidly growing population and service new homes in greenfield areas has also pushed our existing capacity to the limit,” Mr Cheroux said.
“Our infrastructure needs significant renovation to keep up with today’s demands and prepare for tomorrow’s.”
Sydney Water will not be able to increase its prices unless it receives approval from the independent Price Regulatory Tribunal (IPART).
The 546-page proposal was sent to IPART, and Tribunal President Carmel Donnelly confirmed that it will “assess whether these proposed cost increases are justified so that customers pay only what water companies need to efficiently deliver their services to customers.”
Ms Donnelly said IPART will examine whether prices are “in the best interests of customers” and “promote value for money”.
The cost increase would be felt next year if approved.
Sydney Water executive general manager of customer experience Denisha Anbu said it does not “take price increases lightly” and “recognises the impact on our customers”.
As part of the five-year plan, he said Sydney Water will set aside $1 billion to support customers who “need it most”.
“We have to remember that Sydney Water prices are among the lowest in the country – apart from inflation, they have not increased in the last 10 years,” Ms Anbu said.
“Even with this proposed price increase, we will still be among the lowest in the country.”