Queensland regulator investigating irrigation prices

Posted 06 November 2018

water prices
An independent review of irrigation pricing in Queensland is being undertaken in an attempt to give water users greater certainty into the future.

The Queensland Competition Authority (QCA) will investigate prices for water supply schemes operated by SunWater and Seqwater for the next pricing period, which goes from 1 July 2020 to 30 June 2024.

Prices currently in place for 2018-19 will be adjusted for another year in line with past price path arrangements. 

The review will take into account efficient costs for operations, maintenance, administration and renewals expenditure.

Natural Resources Minister Dr Anthony Lynham said the goal of the study was to help irrigators plan for the future by giving them greater pricing certainty, simplicity and transparency.

“As part of the review process, extensive consultation will be undertaken with stakeholders and water users to ensure we strike the right balance between the interests of customers and businesses,” Lynham said.

Seqwater supplies water for irrigation to about 1200 rural customers in seven water supply schemes via two distribution systems, while SunWater operates 22 schemes and seven distribution systems.

Lynham encouraged the utilities’ irrigation customers to get involved in the consultation process.

“The more customers that participate in the process, the more informed the [State] Government will be when it is time to consider the QCA recommendations and lock in irrigation prices in 2020,” Lynham said.

The State Government has directed the QCA to provide an additional pricing option that includes dam safety upgrade costs.

LNP Shadow Minister for Natural Resources Dale Last said this could open the door to significant water price increases for Queensland farmers.

“Given the significant dam safety costs in the pipeline for particular regional irrigation schemes, there will be significant price increases that will put in jeopardy the future of irrigation in those regions,” Last said.

The Queensland Farmers’ Federation (QFF) called the review a “mixed bag” for the state’s irrigators.

QFF President Stuart Armitage said some schemes would be more affected than others if the cost of dam safety upgrades were included in irrigation pricing. However, he welcomed the State Government’s decision not to include the costs of providing recreation facilities in the notice. 

“A number of schemes will face significantly higher prices because of cost increases to maintain scheme assets, rising electricity and insurance costs and the impacts of lower water demand forecasts,” Armitage said.

The QCA will provide a draft report to the State Government by 31 August 2019, before recommending final pricepaths by 31 January 2020.

Make a submission about what should be covered in the review here.

 
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