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Newcastle Herald
Newcastle Herald
Jamieson Murphy

'Modest increase': Hunter Water's plan to hike bills by hundreds of dollars

Construction of the Belmont desalination plant will contribute to the increase.

The average water user's bill will see a "modest increase" of about $430 over the next five years, under a plan put forward by Hunter Water.

The proposed rate hike, which is being reviewed by the Independent Pricing and Regulatory Tribunal (IPART), also revealed Hunter Water plans to spend about $705 per customer on the $530-million Belmont desalination plant.

Under the plan, the water, wastewater and stormwater service bills for a typical house would increase 5.7 per cent - or average of $86 - each year for the next five years.

A typical apartment will see their bill jump by around $64 (a 5.5 per cent increase) each year over five years, and the proposed bill increases would be on top of inflation.

At the moment, the average Hunter Water household pays $3.66 a day on water services, which is roughly 1.3 per cent of household income.

Hunter Water indicated it needs $2.5 billion over the next five years, with $1 billion for operating costs and $1.5 billion in capital costs, including infrastructure upgrades.

"This is a significant step-up in expenditure, around 1.3 times greater than its annual spend during the current determination period," an IPART report stated.

"Hunter Water has indicated that its pipes and treatment plants are relatively old and need to be repaired or replaced."

One-third of the capital investment budget ($480 million) will go towards the desalination plant, which would use sea water to provide about 15 per cent (30 million litres) of the Hunter's average daily demand.

Hunter Water managing director Darren Cleary said almost 9000 customers had been consulted over two years before putting the pricing proposal to IPART.

"We know the rising cost of living weighs on our customers, and we don't take an increase to our customers' bills lightly," Mr Cleary said.

"In developing our proposal, we've balanced addressing current issues with maintaining affordability and ensuring fairness for future generations."

Other large infrastructure projects include upgrading the water treatment plants at Burwood ($70 million) and Grahamstown Dam ($112 million).

There are also $60-million plans to introduce sludge treatment at Burwood, while $56 million will be spent replacing the next section of the Chichester Dam pipeline.

Hunter Water told IPART it was only making target improvements "in areas that customers have said were important and were willing to pay for".

IPART has called for community feedback on Hunter Water's proposal. It will consider public submissions, before releasing a draft pricing decision in March, 2025.

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